Pension Contributions vs House Purchase

Timhg

M 39 with home-schooled daughter and stay at home wife.
Private renting @ 70% market rate
£40k savings @ 4% with easy access

I see myself landing in a very fortunate but strange position in a couple of months where I will finish the year with a total taxable income of around £135k made up of salary/bonus/healthcare/car. More than DOUBLE what I've ever reached before and don't get me started on the single income taxation that is wholly unfair!!!

I come from a very hard working family where owning a property is first and foremost so my question here is: what should i do with my savings?

Make a pension contribution before year end for relief at source
or
Buy a house (£320k w/ 10% deposit @ 5.1%)

Dazed_and_C0nfused

Do you understand tapered Personal Allowance?

And if you did contribute to a pension in the current tax year do think it could be more than £10k?

silvercar

What is the future renting situation? How long are you guaranteed to get a rent at a big discount on market rent? Is the rent likely to increase or is it fixed? 

Without knowing the answers to the above, I would say that buying is better than renting, more control from landlords who may want their property back, no risk of sharp increases in rent, no problems in finding a new rental property etc. Plus the eventual outcome of clearing your mortgage and living rent free in retirement,

Timhg

silvercar said:

What is the future renting situation? How long are you guaranteed to get a rent at a big discount on market rent? Is the rent likely to increase or is it fixed? 

Without knowing the answers to the above, I would say that buying is better than renting, more control from landlords who may want their property back, no risk of sharp increases in rent, no problems in finding a new rental property etc. Plus the eventual outcome of clearing your mortgage and living rent free in retirement,

We're 6yrs in the same private rental now and the cost has only moved £695>£850 in that time. I would say we're sitting comfortably. But if we're removed at any point then it's going to be a sharp rise.

I guess it's the age old question of interest on savings Vs making money on property

horsewithnoname

Timhg said:

 silvercar said:

What is the future renting situation? How long are you guaranteed to get a rent at a big discount on market rent? Is the rent likely to increase or is it fixed? 

Without knowing the answers to the above, I would say that buying is better than renting, more control from landlords who may want their property back, no risk of sharp increases in rent, no problems in finding a new rental property etc. Plus the eventual outcome of clearing your mortgage and living rent free in retirement,

We're 6yrs in the same private rental now and the cost has only moved £695>£850 in that time. I would say we're sitting comfortably. But if we're removed at any point then it's going to be a sharp rise.

I guess it's the age old question of interest on savings Vs making money on property

What about having a secure home? It’s not all about money.