Looking for ...

Thali

Hi there,

Could someone please post the link to the Thread "Why renting isn't dead money" or "Why renting is dead money".

Sorry, was looking for one specific one and can't find it anymore.

Much appreciated!

Thali

N79

In my opionon, renting is not dead money when the cost of the rent is less than the interest you would pay on a loan to purchase the same property. This ignores capital growth.

If you want to get really clever, you also need to factor in whether the capital growth of the deposit you would pay to buy a house is greater than the difference between the rent and interest charges for the property. IE Do you gain more by saving the difference in rent or from the capital growth.

To get really really clever, you also need to allow for the fact that the deposit and the savings would receive capital growth in their own right.

Personally, this is a complex question and any answer would only be a guess so it is really not worth worrying about!!!!!!!! I always try to think of my home as my home and not an investment. I have other assets as investments.

I'm not sure that I understand everything I said above!

N79

PasturesNew

As the poster above said, while any thread could be a jolly read, everybody's individual circumstances vary so wildly there can be no one answer.

Even with a spreadsheet to calculate it, you'd have to make wild guesses at most of the figures, so it's all hypothetical.

My understanding is the following though:
- over your lifetime renting will probably cost you more because a mortgage stops one day
- having a mortgage can lead many people to keep tarting up the house and re-mortgaging to pay for it, costs which renters don't have
- each time you move house, whether renting or mortgaging, would incur variable costs, which would need to be taken on board
- in a falling market, it is mostly mortgaging that is dead money
- in old age you're better off having bought (probably) depending on age/size of property
- the time you plan to spend in any property would have a significant bearing on the outcome. If you moved every year (some people do), then for the next 15 years renting would probably win, whereas if you weren't going to move ever then maybe over the next 15 years mortgaging might win (but only might dependent on how slowly prices drop/rise over that time, interest rates, extra you can pay off)

So it's how long is a piece of string.

lil_me

I've we'd have bought instead of renting this house we'd have lost money already, offers were at £195k ish then, think the current valuations would be a good 15-20k less as 4 bed much larger properties going for that now. For once I can say £3k rent so far is money well spent!