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Is now a good time to buy for FTBs
Comments
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Herzlos said:Sarah1Mitty2 said:CSI_Yorkshire said:Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?
But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs. You cannot, particularly when looking at your latter years, be in a better position by paying rent. So anyway you look at it, buying your home is an investment with considerable benefit.
It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.
Assuming of course that the cheap rental is of a similar standard to the mortgaged house, and the cheap rental hasn't launched up in price as well?Any time I've looked, rent has been significantly more than a mortgage, and if you're paying any capital back on the mortgage then after 20-30 years you get to stop paying once it's cleared. Even ignoring equity entirely, over the longer term the mortgage is a better idea.As for over-extending and buying at peak before rates flew up, that definitely sucks and will force some people to downsize, but to most of them it's going to be largely irrelevant in 20 years time.When I bought just before the 2008 crash I was in about £30k negative equity almost immediately, but I sold it recently with £70k positive equity. Had I rented the same thing I'd have paid out twice as much and got nothing back on it.0 -
Herzlos said:Sarah1Mitty2 said:CSI_Yorkshire said:Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?
But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs. You cannot, particularly when looking at your latter years, be in a better position by paying rent. So anyway you look at it, buying your home is an investment with considerable benefit.
It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.
Assuming of course that the cheap rental is of a similar standard to the mortgaged house, and the cheap rental hasn't launched up in price as well?Any time I've looked, rent has been significantly more than a mortgage, and if you're paying any capital back on the mortgage then after 20-30 years you get to stop paying once it's cleared. Even ignoring equity entirely, over the longer term the mortgage is a better idea.As for over-extending and buying at peak before rates flew up, that definitely sucks and will force some people to downsize, but to most of them it's going to be largely irrelevant in 20 years time.When I bought just before the 2008 crash I was in about £30k negative equity almost immediately, but I sold it recently with £70k positive equity. Had I rented the same thing I'd have paid out twice as much and got nothing back on it.
2) Mortgage is significantly more now.
3) Many were already in "starter homes" at these silly prices, what will they downsize to? (assuming cladding etc. laws allow them to even sell?)
4) Your house made you the equivalent of a couple of overtime shifts a month, but unless you downsized or waited for price drops this money didn`t stay in the bank?
Can I ask what level base rate was at when you sold this house?0 -
1) Doesn`t have to be similar standard, it is the difference between overpaying and renting cheaply I was discussing.
Where will you rent cheaply? Rents are through the roof, much more than mortgages.
2) Mortgage is significantly more now.
No, they are not. Yes, some mortgages will go up a few hundreds of pounds (eventually), but rents are rising by much more than that.
3) Many were already in "starter homes" at these silly prices, what will they downsize to? (assuming cladding etc. laws allow them to even sell?)
What's a silly price? Covid might have accelerated house price growth, but that growth is now very much embedded in. At this point in time, anything between a 20-40% drop will only get you back down to covid peak levels, so it's not like that will be cancelled. People did buy those properties, that's the price.
4) Your house made you the equivalent of a couple of overtime shifts a month, but unless you downsized or waited for price drops this money didn`t stay in the bank?
No, but the money is there. You can access it by means of re-mortgaging, secured loans, long-term equity release and/or future plans (retirement, selling etc.). It also grows steadily.
Can I ask what level base rate was at when you sold this house?2 -
Sarah1Mitty2 said:1) Doesn`t have to be similar standard, it is the difference between overpaying and renting cheaply I was discussing.
2) Mortgage is significantly more now.
3) Many were already in "starter homes" at these silly prices, what will they downsize to? (assuming cladding etc. laws allow them to even sell?)
4) Your house made you the equivalent of a couple of overtime shifts a month, but unless you downsized or waited for price drops this money didn`t stay in the bank?
Can I ask what level base rate was at when you sold this house?1. You need to compare a similar standard. Obviously renting a 1 bed flat is likely to be cheaper than buying a 4 bed bungalow, because it's meaningless because not everyone wants to live in a tiny box waiting on the perfect time to buy a bigger house and enjoy life.2. Mortgage is more than rent? Are you sure? Because lots of rentals are going up to match landlords mortgage increases.
3. I suspect the people over-leveraged are more likely to be in bigger homes than starters.4. The money didn't go into a landlords bank either. It helped me with better LTV rates and a huge deposit.
5. 5.25%. We sold recently and had enough interest for it to go for a healthy figure. I can't remember the base rate when I bought, but my first mortgage was at 5.7% and was still cheaper than renting.Edit: Base rate was 5.5% when I bought last time. That was just before the crash and of course we could be looking at another crash. I may lose out a bit on paper if we do crash, but I'm in a house I really like and any paper loss right now will mean nothing in 20 years time.
How long have you been renting a tiny bedsit waiting for houses to crash now? How big a drop do you need to break even?
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Mstty said:Herzlos said:Sarah1Mitty2 said:CSI_Yorkshire said:Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?Sarah1Mitty2 said:MEM62 said:Sarah1Mitty2 said:MEM62 said:tbo127 said:Is now a good time to buy for first time buyers given the falling property prices?
If you need somewhere to live you can either buy or rent. The former is an investment, the latter isn't.
Yes, you can walk away from a rental but what that got to do with the fact that buying your home being an investment? Making life decisions based only on what you can easily walk away from is hardly the best philosophy, is it?
But even if circumstances for most are different and they cannot release the equity, they will still one day be in a position where they do not have monthly rent costs. You cannot, particularly when looking at your latter years, be in a better position by paying rent. So anyway you look at it, buying your home is an investment with considerable benefit.
It is unlikely for most people, in anything other than circumstances contrived purely for mathematical demonstration or a complete collapse of the economy which would likely drag down most alternative investments as well, that they will be better off paying rent which returns no equity stake in a property than by paying a mortgage which does.
Assuming of course that the cheap rental is of a similar standard to the mortgaged house, and the cheap rental hasn't launched up in price as well?Any time I've looked, rent has been significantly more than a mortgage, and if you're paying any capital back on the mortgage then after 20-30 years you get to stop paying once it's cleared. Even ignoring equity entirely, over the longer term the mortgage is a better idea.As for over-extending and buying at peak before rates flew up, that definitely sucks and will force some people to downsize, but to most of them it's going to be largely irrelevant in 20 years time.When I bought just before the 2008 crash I was in about £30k negative equity almost immediately, but I sold it recently with £70k positive equity. Had I rented the same thing I'd have paid out twice as much and got nothing back on it.
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Look at it like this : You will need a roof over your head from the day you are born to the day you die. Food for thought.0
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Herzlos said:Sarah1Mitty2 said:1) Doesn`t have to be similar standard, it is the difference between overpaying and renting cheaply I was discussing.
2) Mortgage is significantly more now.
3) Many were already in "starter homes" at these silly prices, what will they downsize to? (assuming cladding etc. laws allow them to even sell?)
4) Your house made you the equivalent of a couple of overtime shifts a month, but unless you downsized or waited for price drops this money didn`t stay in the bank?
Can I ask what level base rate was at when you sold this house?1. You need to compare a similar standard. Obviously renting a 1 bed flat is likely to be cheaper than buying a 4 bed bungalow, because it's meaningless because not everyone wants to live in a tiny box waiting on the perfect time to buy a bigger house and enjoy life.2. Mortgage is more than rent? Are you sure? Because lots of rentals are going up to match landlords mortgage increases.
3. I suspect the people over-leveraged are more likely to be in bigger homes than starters.4. The money didn't go into a landlords bank either. It helped me with better LTV rates and a huge deposit.
5. 5.25%. We sold recently and had enough interest for it to go for a healthy figure. I can't remember the base rate when I bought, but my first mortgage was at 5.7% and was still cheaper than renting.Edit: Base rate was 5.5% when I bought last time. That was just before the crash and of course we could be looking at another crash. I may lose out a bit on paper if we do crash, but I'm in a house I really like and any paper loss right now will mean nothing in 20 years time.
How long have you been renting a tiny bedsit waiting for houses to crash now? How big a drop do you need to break even?0 -
@Sarah1Mitty2
I think you miss the point, house ownership is not easy but it is rewarding. Sometimes you buy at the height and sometimes in a dip but there will be many heights and dips throughout your 25+ years mortgage journey.
Anyone that keeps putting people off buying may never get it.
1) the feeling of coming home to your own property
2) sense of achievement
3) the options financially it brings later in life
How old are you Sarah(roughly) what is your property situation are you still at home? Or are you renting paying some else's mortgage for them?
It would be good to know where all this bitterness to property ownership comes from as you could end up convincing people to follow your advice and they will miss out as you may have done.
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tbo127 said:It’s hard to know if you buy and then you’ll regret it a couple of years later.
Let's put it to the test. Are there any mortgage-free homeowners on here who wish they were still renting instead?0 -
spoovy said:tbo127 said:It’s hard to know if you buy and then you’ll regret it a couple of years later.
Let's put it to the test. Are there any mortgage-free homeowners on here who wish they were still renting instead?
All these "don't buy" commentators on the board just don't get that.0
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