Bored? Analyse my position and opinionate!

futurecut

Me and my girl rent in the trendy West-end of Glasgow. Nice trad red tenement with nosy neighbours. £550pcm plus £180 council tax. But only one bedroom and it's too small.

Close by is Thornwood, an area still classed as west end but a bit more grotty. Prices there are still high but i've seen a 70's flat that looks well built with three doubles and dining kitchen.

The word on the street is that the area is on the up as directly over the river is the as yet uncompleted Glasgow Harbourside mega development of overpriced, poorly built, bought off the plan plasterboard crates. (Can you tell i hate plasterboard walls?) Local amenities and services are good by Glasgow standards and we'd only be robbed in the streets occasionally.

It's on at offers over 87.5k and i think it's been on a wee while now. If we could get it sub 100k is it a wise move?

We both earn 25k and 25-35k (as a locum) respectively but the higher earning lovely lady is self employed through a private limited company for tax reasons.
We both graduated within 7 years.

I don't know who to listen to about forthcoming trends; everyone has their own ideas and it can become a bit of a quagmire and i seem to change my opinion on wether to go for it or not daily!

Your opinions would be valued

TheDink

How much would your mortgage repayments be? If these are manageable, or even better, lower than your rent, I would go for it.

It's always going to be a gamble - whenever you think about buying it could be that prices are about to crash, or if they have been going down, you never know when they might turn the corner and go back up again.

Think about things sensibly, make sure you can afford the mortgage repayments and other costs (insurance, tax, ground rent etc) and be in it for the long term, not just in the hope of making money if the area does turn out to the on the up - that would simply be a bonus.

budgetflyer

At the moment £6500 per year of YOUR money is going towards reducing someone elses mortgage ! If you can look long term then it must surely make sense to buy.
Even if there is no capital appreciation for a couple of years, at least you will be paying some of the mortgage off and will have some equity available.
I don't think there is going to be any "crash" in Scotland as we haven't had the crazy house price inflation seen further south.

deemy2004

As the previous poster has mentioned !

Your already paying more in rent than you would do in a mortgage for a house for 87.5k !

So GO BUY !!! NOW !!! remember in current market you can offer LESS than the ASKING !

Lets do some sums

£550 rent = £6,600 per year
Mortgage = Say 6% on 87.5k = £5,250

Cripes ! You would be £1350 a year better off !

NOW Say house prices fell 15% over 2years - thats
£13,125 loss in value.
WELL the rents your paying over two years is MORE !

So go for the bigger flat ! and don't worry about house price falls as your going to be living in the flat for some time and your not buying to lett or for spec reasons.

futurecut

Thanks for that. Let's hope we can get a nice place at a reasonable price.

budgetflyer

This is the bit I can't understand.They put interest rates up to slow demand.
So you buy when rates are low,2 years down the line interest rates double and no one wants to buy a house!
Surely if you buy when rates are high then things can only get better.
I remember back in 85/86 rates reached 13% with the threat of going to 25%.
The important thing to consider is at whatever the rate, can you afford the repayments if they DOUBLE. In the long term you will be better off but you should cover yourself for a rocky ride anyway

deemy2004

Hi

They put up rates to control inflation / the exchange rate. So if the £'s strong, then rates will be low, if the £'s weak than the rates will be high.

As a rising £ reduces inflation and a falling £ increases inflation.

Robert_Sterling_3

In 1980 the Halifax Building Society had a rate of 15% on mortgages up to £20,000, 16% up to £25,000 and 17% up to £30,000.

deemy2004

In 1990 base rates peaked at 15% - Then YOU COULD Lock in investment rates at over 12% !

Mortgage rates peaked also over 15%

Imagine locking into an investment yield for 20 years at over 12% ! Now thats magic !

vansboy

Simply.......

You know the area, as well as anyone..

You are both in safeish jobs..

You're paying SOMEONE ELSE, for the benefit of living where you don't like...

You NEED a home of your own...

Plenty of tie in/fixed mortgage deals around...

BUY IT!!!

VB

Nethouseprices

Me and my girl rent in the trendy West-end of Glasgow. Nice trad red tenement with nosy neighbours. £550pcm plus £180 council tax. But only one bedroom and it's too small.

Close by is Thornwood, an area still classed as west end but a bit more grotty. Prices there are still high but i've seen a 70's flat that looks well built with three doubles and dining kitchen.

If you can find a trad tenement or subdivision which you can afford you will do much better in the long run. Glasgow still has affordable Victorian property - if you look at Edinburgh even areas that were "untouchable" are sought after now. There is a limit to the amount of old property, but modern is being continually added to.

Regards

Steve