john banks

Matteeboy, tdw will not like this of course, but I routinely calculate a rate of return from assets, whether they are financed by debt or not, and manage them appropriately. I minimised exposure to property when the yields were lower than a tax free return I could achieve with negligible risk to capital. Now that has changed, so I have changed with it. Some don't want to play this game and employ platitudes about buying property to live in etc. That is fine if they are disinterested or unskilled or think it is unethical. Personally I think they are missing out on income that can exceed that many make from traditional work, they probably see me as an opportunist self congratulatory toe rag

Cocker

iTrader: (3)

I hope the interest rate stays at 0.5% for the next 10 years. Tracker rate mortgage FTW

Oh an IMVHO, I would rather own a bedsit that rent a 700k house for £1,000pm. At least I will not be paying somebody else mortgage until the day I die, and will have something to leave to my child

Oh and lets see if your pension pot is large enough to still afford the rent when you retire

Reminds my of my brother in law - was bragging about ordering his new 5 series at the weekend, which incedentily is a company lease car, yet doesn't own his own property at 55 years old and has no pension pot. I really want to ask him where he thinks he's going to live when he retires, or what he's going to live on income wise

Matteeboy

So what about the interest you pay then? Forgotten about that like most seem to?

We will buy outright at some stage. I'd rather pay money to a landlord I get on with than some tosser bank.

Money down the drain? What utter BS; we LIVE here, love the area, the kids love it, the sea is a two min walk away, the school is superb, very sociable. Money well spent actually compared to living in some crappy estate dreaming about the "next" house. And all that for a lot less than the interest on a mortgage; the biggest LOAN you will ever have.

Worked out how much interest you'll pay on the life of a mortgage? I doubt it. But thanks for the usual vacuous "advice."

We are so brainwashed in this country, it's hilarious.

If prices don't sort themselves out here, we will move to France or Spain; simple.

f1_fan

iTrader: (9)

In many European countries renting is the norm. Are the Germans et al all stupid too?

ReallyReallyGoodMeat

Depends, are their rents as ridiculously high as ours?

Matteeboy

No and their property prices are much lower too. Guess who has the booming economy based on actually making stuff, not making stuff up?

jonc

Over the long term, still works out financially better off with a mortgage. For a £600k mortgage at 3% over 25 years, interest is around £270k, rent at £1200 over the same period is £360k and with nothing to show for it. Granted this is somewhat simplified and does not take into account rises in interest, rent or property price (only relevant really when come to selling), and of course the term of the mortgage can be shortened to reduce interest further, but you get the idea. At the end of the mortgage term you have a property to live in and something to provide a nest egg or security for your offspring. A mortgage may be the biggest loan you'll ever have, but at the end of a tenancy, you have no property to live in and no return on the outlay.

If the strategy it to rent short term to save cash for a deposit or for outright purchase, well there is nothing wrong with that either. However, you also have to consider how much you can save in renting against how much the market is rising.

hodgy0_2

Yes, I agree, we have a model, in Germany, for a successful economy – shared effort shard rewards

We as a nation simply don’t want that model

In life you have to play the cards that are dealt, you have to play the cards on the table and in your hand

No good worrying about what cards you would like to be dealt, or indeed the cards you think should be dealt – simply pointless

We base our economy on property values – simple, and a really easy way for the wealthy to get wealthier, again simple

Get in or get out – and if you can’t get “in” it is tough I am afraid – nothing is going to change

and if you think it is going to change, just remember the fact that the government has used 100's of billions of £'s to ensure it does not

Dingdongler

Rubbish.

Are you saying there are no opportunities in this country? That somebody can't come from a modest or poor background and achieve something?

You must live in a different country to me because I see people like this all the time. I see people who have only been in the country five years and run their own business, own their home and their kids are winning scholarships.

Of course it's more difficult for somebody from a modest background to succeed compared to the offspring of a multimillionaire but that's just life. Everybody can't have exactly the same otherwise you'd have the most extreme form of communism and as a result would kill the human spirit.

hodgy0_2

no. where do i say that in my post

off course opportunities are there, I would argue they are getting smaller and this is born out by every study in social mobility -- which has collapsed in the last 30 years

what exactly in my post is "rubbish" btw -- be as specific as you can

f1_fan

iTrader: (9)

This ^^^^^^^^^^^^^^

ReallyReallyGoodMeat

When you say booming, you mean 0.3%?

http://www.bbc.co.uk/news/business-22810772

dpb

Yeh cant see it's ever going to change here

If you can't stand it go get something else as well/instead, in another country


One things for sure this is what inner city life will be like in the next twenty years, for sure


http://www.theguardian.com/world/gal...-tiny-cubicles

Matteeboy

Interesting how they left out the (very low) level of debt... Ours is many times higher. The BBC loves being selective with its economic news.

Ding; for someone so sure of themselves, you sure do fling a lot of insults around. Classic signs of feeling defensive; I wonder why?

dpb

Probably in addition to a massive housing crash in 2018

Cocker

iTrader: (3)

Its not "advice" and i'm not saying renting is bad, just not for me at my stage of life. I feel sorry for first time buyers who have to save 20k plus just for a deposit especially when they are paying a high percentage of their salary paying for somebody else's mortgage already

Have you worked out how much interest you're paying? Seems like 100% to me with no return

You said you will buy outright at some stage. Why not now? Plus what about the interest you will pay when you do buy? Don't forget to add on all 100% interest you're paying now unless of course you are rich enough to buy outright. If you are then good for you, but then why haven't you nought already?

When you do buy will you be able to afford to buy the equvilent house that you are in now? If yes fantastic, if no then good luck with the lifestyle drop

Oh and I love my LOAN. It give me and my family security and the knowledge when I retire I wont be in a council house because I can't afford to rent privately, and when i'm 6 foot under my daughter will have a nice inheritance to pass on to her family

Oh and of course you get on with your landlord. Why would he annoy you when you are giving him lots of money every month

Matteeboy

We choose not to buy at the moment unless something decent comes up. We will buy mortgage free with savings. Or we might not; it's nice having the choice.

100% interest when you rent? Errrmmmm...

scoobynutta555

If house prices are rising (they are here for sure) then why not buy instead of renting especially as you can buy with savings? With interest and inflation as they are now you're losing money.

Matteeboy

Because houses here are over-valued. We might buy somewhere cheap and do a year in France; we will see. We just like remaining flexible, live living here and prefer the current situation.

I also think the price "rises" are short term waffle and won't last. That's even if they exist, which they don't here; more and more places are coming up at more sensible prices than recent years.

Buying ties you down, limits opportunities; we prefer to do what we want at weekends and that doesn't include endless DIY.

scoobynutta555

Well I don't know where you live. Certainly around here (St Albans postcode) things are selling well and definitely rising. I disagree that house prices are over valued, there's simply too much demand for housing to see a large drop. In any case, you've got to live somewhere so why rent when you can buy? Strange.

Cocker

iTrader: (3)

That's fantastic if you can buy cash, but why wouldn't you, if you say you had the choice. You'd just be paying interest that you didn't need to

£1000 rent over 300 months = £300,000 spent and nothing to show for it

£1000 mortgage over 300 months = £300,000 with a property worth the equivalent of what a 220k property is worth now (based on 3% interest rate for the full term, which ok may not be realistic, but hey the rent wont probably be £1000 per month for 25 years either)

Matteeboy

We just don't want to buy; too much fun still to be had! Yes it's unusual but it's our choice and we've spent a lot of time thinking about it.

Some good points here but like a belligerent child, we like things renting, saving and being able to do stuff like naff off to Europe for five weeks in our camper. Which we did in June.

Dingdongler

Err, who exactly have I thrown insults at? (apart from you and TDW)

Is that based on me saying Hodgy's post was 'rubbish'? If so I hardly think that is an insult, it's just my opinion on that one post. Hodgy is obviously a very intelligent man and I've said as much many time. He has become a bit of a champagne socialist though


You on the other hand insult half the country on a daily basis. If we looked through your posts we'd see your endless insults about people who happen to have a mortgage or take out a loan out to buy a car. Not to mention parents who both work to make end meet.

So I don't regularly throw about insults, but TDW and your good self are an exception

Dingdongler

Maybe I misunderstood but what was all cards dealt etc stuff about then?

tony de wonderful

Traditional work? You mean actually creating wealth? How old fashioned!?

You are the one who claims that liberal capitalism is a force for good and can emancipate everyone, yet here you are competing for an asset which give you are right to create no wealth yourself and extract it from other people. Moreover, you are pusing up the price of rents, house prices, making many people more precarious, adding to a growing social problem.

Chip

And why would owning a house chnge the way you do things then?

Cocker

iTrader: (3)

And that's your choice which is great. As said everybody does whats best for them

I also enjoy buying, saving and having fun > Bizarely my mortgage monthly payment is £1000 exactly due to an overpayment I have set up. The months interest they charge is around £150 per month so I am saving £850 and the interest is negated by the value of my property rising by more than this every month (recently got it valued at 40k more than what we paid for it 8 years ago)

Enjoy your Europe trips, we are off to Florida at Christmas. I can't wait. You do live in a great place though I love Cornwall, had a few nice breaks down there recently.

hodgy0_2

In simple terms, one may think our reliance on property in this country is right or wrong, but the simple fact is (in my view at least) that on a personel level no other economic transaction is as (potentially) profitable

Nothing I see about how this country is (and has been run) dissuades me from that view

Those are the cards - play them

john banks

A mixture of both works for me. What about you?

tony de wonderful

Equality of opportunity is a libertarian idea. Merit not ascription or privilege.

Anyway, most old fashioned libertarians would balk at the idea of privileged rentier classes, as our country turns into a quasi-feudal society where a few are licensed to parasitically live off the sweat of the precarious rest. It's cynical and indefensible.