Possible house purchase in 2024

Luke451

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MultiFuelBurner

The answer is 42

Flugelhorn

MultiFuelBurner said:

The answer is 42

then take away the number you first thought of

Bigphil1474

OP, sorry, your post was far too long to read it all, so I'll respond on the gist of what i did read. The last bit (38) made me laugh - that's nonsense so don't know where you got that from. There are some trashy areas in the UK, and some areas that have become trashy, but many that aren't. London is a great example of how former trashy areas have become gentrified and are now seen as upmarket.

If you rent a house, you are paying someone else's mortgage but you are relatively free to do your own thing, and have less responsibility in terms of repairs, maintenance etc. If you buy a house you pay your own mortgage but you are tied down to a greater degree, and have the responsibility of maintenance etc. If you don't pay a mortgage, you don't have that money to save as you need to pay rent. Seems a straight forward choice to me. Bear in mind, typically lower interest rates increase demand in housing which increase prices. Depends where you are aiming at, but you could wait for interest rates to come down, but by then the price of houses may have gone up. Most lenders allow you to pay 10% of the outstanding balance extra each year. We've spent maybe 100k on our mortgage over the last 25 years, but we are now mortgage free and the house is worth more than what we bought it for + the mortgage payments + any costs we have incurred maintaining it, so we haven't really lost that money.

In terms of pension, it's each to their own. I earn a decent wage with a decent pension forecast. I could pay more for additional pension, but I choose to enjoy that money now rather than hope in the future that I will retire early or at state pension age and be able to enjoy life - my dad retired on his 65th birthday and his life went downhill rapidly from then, died aged 78 after 10 years of living in pain. A former colleague of mine retired 4 years ago - died 2 years ago. You may have a long and happy retirement, but there's a long way to go if you're in your 20's. I look at it this way - how much would I need to have to live on to have an enjoyable retirement. If I strip away what money I spend now, that I wouldn't when retired, and add on some for the things I want to do, I know what monthly income I need from my pension, and I am on target for that. I will still be mortgage/rent free.

Luke451

Bigphil1474 said:

OP, sorry, your post was far too long to read it all, so I'll respond on the gist of what i did read. The last bit (38) made me laugh - that's nonsense so don't know where you got that from. There are some trashy areas in the UK, and some areas that have become trashy, but many that aren't. London is a great example of how former trashy areas have become gentrified and are now seen as upmarket.

If you rent a house, you are paying someone else's mortgage but you are relatively free to do your own thing, and have less responsibility in terms of repairs, maintenance etc. If you buy a house you pay your own mortgage but you are tied down to a greater degree, and have the responsibility of maintenance etc. If you don't pay a mortgage, you don't have that money to save as you need to pay rent. Seems a straight forward choice to me. Bear in mind, typically lower interest rates increase demand in housing which increase prices. Depends where you are aiming at, but you could wait for interest rates to come down, but by then the price of houses may have gone up. Most lenders allow you to pay 10% of the outstanding balance extra each year. We've spent maybe 100k on our mortgage over the last 25 years, but we are now mortgage free and the house is worth more than what we bought it for + the mortgage payments + any costs we have incurred maintaining it, so we haven't really lost that money.

In terms of pension, it's each to their own. I earn a decent wage with a decent pension forecast. I could pay more for additional pension, but I choose to enjoy that money now rather than hope in the future that I will retire early or at state pension age and be able to enjoy life - my dad retired on his 65th birthday and his life went downhill rapidly from then, died aged 78 after 10 years of living in pain. A former colleague of mine retired 4 years ago - died 2 years ago. You may have a long and happy retirement, but there's a long way to go if you're in your 20's. I look at it this way - how much would I need to have to live on to have an enjoyable retirement. If I strip away what money I spend now, that I wouldn't when retired, and add on some for the things I want to do, I know what monthly income I need from my pension, and I am on target for that. I will still be mortgage/rent free.

The only reason for the increase in London is due to foreigners constantly bringing cash, it was just an uptrend due to that, but the majority of it, it's due to big investors, local or not, and they have the chance to hold those assets for as long as they want... No social system in UK, just business.

In London and surroundings there are incredible problems, you can easily see that the Londoners are the most broken in the country, and by that I mean by their savings and their financial pressure, though this doesn't necessarily mean that Londoners are poorer than the people living in the poorest places in UK, it's by far the indicator that reveals the problem.

I can't mention how Londoners are defined in the rest of the country (professionally, not out of guts), but it's not a nice place where to live.

Just to mention a few, very few places have optical fiber, crime rate, 4-5G basically useless thanks to the refractive foam or material that they use to build, oh that's also valid for standard call , and so on, but yeah, prices went to the moon.

If you go to sell your house now, how much would you actually make?
Then what, would you rent somewhere else or buy somewhere else? Buying would erase your gains, or worst, if you rent instead, probably you'll do great, assuming they rent out to someone of a certain age plus all the incredible missing supply that creates a very hot market, not easy to even get a meeting booked to see the house. No offense here, but this is what would happen to me as well.

The problem about an house is that it doesn't create actual wealth that you can easily make it tangible, because you need to keep it, it's not something you sell and then you're free, but I could if I opt to retire in a nice Van or Motorhome and travel .

It's an hard asset that costs an hell, but in comparison, the house I need costs 1500 for rent, out of 1050 of mortgage as of today...

The only difference is that I need to sell at a loss my investments and that accounts in the big picture, so I could wait and building cash, or buy now by selling at 50% loss.

On top of it, the biggest fear is do not find a rental in the market, trust me, it's not a great experience to hunt for rent, in any case, the majority of houses are really crap, but due to the supply shortage, the rent is high anyway, so I'm almost forced to buy just due to that.

More I go ahead, more I think about start to enjoying life the way I want (as you said) or the way I NEED for my health, that's by far the most important thing...

So, buying seems the only option here in UK for me, despite the financial pressure due to interest rates.

The only positive thing is that when I'll remortgage in future, interest rates could be lower, and by that point, I would have paid the most of it in about 5y if I keep paying at 100% of my monthly capacity.

MeteredOut

I think house prices have gone up 10% in the time it took me to read that

babyblade41

MeteredOut said:

I think house prices have gone up 10% in the time it took me to read that

   very good 

Bigphil1474

OP, I get the impression you aren't from these here parts? Not a criticism, but the UK has some great areas to live in and some very bad areas to live in. London isn't a good example of living in the UK as it has it's own issues that you don't find elsewhere. I've had family live in Norfolk, which isn't somewhere I'd choose, but they loved it. Same with Lincolnshire, Oxfordshire, South Wales and so on. The city I live in has some nice areas and some horrible areas just a few miles apart. 

When I do sell my house, I am buying a new house, but we are putting the house money and some savings together to buy a house mortgage free. So no mortgage and no rent. That is what makes buying a house worthwhile for me. If I rented, I'd always have that chunk of money coming out of my income every month. 

RHemmings

I feel that I'm guilty of over-thinking my upcoming house purchase. But, I feel that you, @Luke451, have taken it to a higher level than me. I don't mean that as a criticism, just an observation. Certainly thinking through the financials is a good thing. Perhaps on a forum a shorter summary is more likely to be digestible for readers. Is there a TL;DR version?

It looks to me as if you have a good salary and can save a lot of money. You have a good deposit, and clearly have the numerical ability to think through things including future possibilities such as car ownership costs. I'm also of the mind that not all areas in the UK are suddenly going to go downhill. 
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Grizebeck

Why are you spending so much time on this

MultiFuelBurner

RHemmings said:

I feel that I'm guilty of over-thinking my upcoming house purchase. But, I feel that you, @Luke451, have taken it to a higher level than me. I don't mean that as a criticism, just an observation. Certainly thinking through the financials is a good thing. Perhaps on a forum a shorter summary is more likely to be digestible for readers. Is there a TL;DR version?

It looks to me as if you have a good salary and can save a lot of money. You have a good deposit, and clearly have the numerical ability to think through things including future possibilities such as car ownership costs. I'm also of the mind that not all areas in the UK are suddenly going to go downhill. 
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When they post 15 new posts on the subject they might give you a run for your money. I don't mean that as a criticism just observation.

That said they do appear to be a few numbers short of a full list. It starts at 11 then 12 then jumps to 21 etc etc.