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I was responding to the question on the following forum:

http://sheffieldforum.co.uk/showthread.php...1133#post641133

Ive recently got a new job in sheffield and will be moving into the area as soon as my current house sells. I have been warned that the market is moving quite slowly in the area and this may take several months.

My inital thoughts were to buy in sheffield immediately, but then as I know no-one in the area thought that moving into shared accommodation for a time might be the better move.

My problem is I have a limited budget for the house purchase and dont want to be priced out of market by waiting perhaps up to 9 months.

Could anyone give me any idea how fast the market is moving?

Someone has replied "Renting is money down the drain"

Anyone got any quick answers to this? Comments like that really annoy me..

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I was responding to the question on the following forum:

http://sheffieldforum.co.uk/showthread.php...1133#post641133

Ive recently got a new job in sheffield and will be moving into the area as soon as my current house sells. I have been warned that the market is moving quite slowly in the area and this may take several months.

My inital thoughts were to buy in sheffield immediately, but then as I know no-one in the area thought that moving into shared accommodation for a time might be the better move.

My problem is I have a limited budget for the house purchase and dont want to be priced out of market by waiting perhaps up to 9 months.

Could anyone give me any idea how fast the market is moving?

Someone has replied "Renting is money down the drain"

Anyone got any quick answers to this? Comments like that really annoy me..

Well, looking at TimmyR's comments, I would have to question if a mortgage really is the same price as renting......... In my experience, mortgage will cost substantially more unless you have big deposit's or interest only.

Edited, Sorry Dafoot's comment

Edited by Salsa

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if your house would be

£100k and the price is going down even just 1% per month.

you have a free £1k per month to spend on rent.

most rent is £600 pcm, so you save £400 pcm by holding off for 1-3 years as they drop -40%.

+when you come to buy in 3 years, you can either pay half, or find a house twice the size.

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I was in a very similar position. I took me ages to sell my house, but no I rent in the new area because I look at it like this.

The house I rent cost me £650 per month = £7800 per year "wasted money"

The house was on the market at £155k and new door was sold a year ago for £155k which is that same house (but less parking space)

Mortagage repayments at 5%, a long term view but I a going to ignore redemption, setup etc.. fees for switching all the time. A buying the house for £150k, 5k below asking the least they are likely to accept.

Just the interest on mortgage = £7500 per year "wasted money"

add buldings insurance at = £200

Leaves just £100 left for maintence cost which can easily be £1000 a year.

So renting cost wastes the same amount of money exculding maintence cost!

I believe that my savings and interest from my STR is going to increase more than the house I can afford to buy, in the worst case stagnation. (exculding VI FUD). If prices fall I am going to be much better off.

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Someone has replied "Renting is money down the drain"

Anyone got any quick answers to this? Comments like that really annoy me..

Interest payed on a mortgage is also "money down the drain".

The real question is whether buying results in more "money down the drain" than renting.

This depends on about a dozen variables, two of the most important of which are:

1) How long you stay in the house before moving

2) Whether the house increases or decreases in value

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I was responding to the question on the following forum:

http://sheffieldforum.co.uk/showthread.php...1133#post641133

Someone has replied "Renting is money down the drain"

Anyone got any quick answers to this? Comments like that really annoy me..

Renting is money down the drain, in the long term anyway. You have nothing to show for it at the end. However, in the current economic climate, with a mortgage on a house costing far more than rent on an equivalent property, it's the lesser of two evils.

Trouble is, most people seem to be short-termists, and don't think of the likely consequences of taking on more debt than they can afford.

You have nothing to lose by renting for a few years. House prices, whether or not they crash, will not be rising faster than salary inflation for the foreseable future, there are too many economic shocks in the pipeline, especially the rising cost of energy, which ultimately effects the price of everyting.

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Thanks for all your replies.

To be honest - it's like shouting at a brick wall on forums like these. I've spent a few months obsessively reading this forum and yet a lot of my friends keep asking me why I haven't bought a house yet (I'm 27 and renting with my girlfriend)

I answer that I'd rather pay 250 quid a month (girlfriend pays other 1/2) to rent a decent terrace house 5 minutes from work with nothing extra to pay... I have a friend who's just got a flat in Manchetser on Interest Only Mortgage - he appears to never have any money despite having a decent job.

Houses in my road were 40k in 2000 - now they are selling for 80-120k... I've seen them adverised without central heating! As other's have said - 100 years ago these houses were steel workers houses - now they are ridiculously overpriced....

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Guest

If an asking price is reduced by £1000, you only save £1000 if you were going to be a cash buyer.

Otherwise, you'd have had to have borrowed that £1000 from a mortgage lender, who will charge interest over the term of the mortgage.

So, for every £1000 that the asking price drops, you're potentially saving a lot more than that over 25 years. Maybe 2.5 times. You will only earn a fixed total amount over your working life! In fairness, this assumes that there's no wage inflation to inflate away your debt. But this is the whole point - we've not been seeing massive wage rises in recent years.

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The "renting is dead money" is a fallacy cruelly exposed in a stagant or falling property market. The statement is only veer true if house-prices are inflating by a reasonable amount. It's not hard to find out what state the makret is in at the moment.

The point you raise about not knowing the area that well is the one that I'd pick up on though.

Renting in this case makes even more sense. Without being committed to an area you will be able to invest in your knowlege-bank by identifying which are/n't the good areas in Sheffield and what suits you best.

Whilst the broad economic ponderings on this forum are useful there is nothing as powerful as 'local knowlege'. My advice is rent, use the time wisely and explore Sheffield as a market...identify what areas are good and growing.

Renting is fine at the moment.

Renting and saving is good.

Renting, saving and identifying where you might buy when the time comes is the best form of attack though.

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Renting is normally money down the drain, but in the current climate with house prices at stupid barely-affordable levels, it's actually saving money in comparison to buying now.

These people are demonstrating their herd mentality and lack of flexibility and individual thought by constantly spewing out the same tired phrases that aren't actually accurate right now. You're wasting your breath, sadly.

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Mortgage interest is rent (however its dressed up) and if the rent on any property is less than the equivalent mortgage interest (for 100% of the purchase price not just what you’re borrowing) then you are speculating on future price rises to compensate you for the additional costs of living in the same house.

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Plus, you can rent fairly cheaply if you look around. A 1 bed flat in Bristol costs in rent approx £600 per month, so i found a decent sized studio flat for £400 per month in a nice area. One less room but i save £200 which i keep adding to my deposit savings!

Rachel

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Guest Bart of Darkness
You won't be throwing money down the drain if you rent for just 6 months because I doubt you will get runaway house prices in Sheffield during that period.

This is correct. Runaway prices have been and gone in Sheffield. I doubt if there is much scope for upward movement now.

What we have at the moment is static prices and low sales volumes.

With prices for 2 bed flats reaching £475,000, you can see that some prices have already reached never-never land.

http://www.rightmove.co.uk/viewdetails-720...pa_n=1&tr_t=buy

Or this at a more reasonable £325,000?

http://www.rightmove.co.uk/viewdetails-924...pa_n=1&tr_t=buy

It's not just me is it? These prices are utterly mad surely?

Howver, there are flats at the lower end of the market that qualify as affordable if not cheap.

http://www.rightmove.co.uk/viewdetails-848...pa_n=1&tr_t=buy

A few years ago, places like that were under £30,000.

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I'm shocked by these in Sheffield, how can people afford to buy these on a normal wage. They aren't really aspirational properties- just terraces a couple of miles from town. (near where I live!)

6 Sep 2004 31 Newent Lane, Sheffield,

South Yorkshire S10 1HD Terraced £130,000

22 May 2003 31 Newent Lane, Sheffield,

South Yorkshire S10 1HD Terraced £65,000

Within 15 months the price doubled!

Now these 2 are on sale on the same road:

http://www2.vebra.com/spencers/SALES/DETAILS/12Newant.pdf

http://www2.vebra.com/spencers/SALES/DETAILS/24Newent.pdf

"In need of some modernisation is this two bedroomed mid-terraced property situated in the heart of Crookes. The property would benefit from the installation of a gas-fired central heating system and some internal modernisation, but will be of interest to both owner-occupiers and first time buyers. The property has access to superb local facilities and transport systems."

110 and 100 thousand WITHOUT central heating!

Its a joke...

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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