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So My Sister Wants To Buy A House

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So I got an email from my sister, who is usually financially savvy.

I've told her to stand firm for years, but as the market continues to defy gravity I don't even try any more. She can't stand the idea of going deeper into her thirties at the mercy of landlords and six month tenancies. I've also given in and bought, so it's do as I say and not as I do.

She wants to buy a place but it has to be in Central London. I have said to her that she should move out of London, but she can't stand the idea of a long commute.

So she wants someone to help fund the deposit on a profit share (hence the email to me) and she will pay for the mortgage partly through renting the place out.

I decided that I wouldn't help, but as she's been there for me in the past I've offered her various pieces of advice.

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You must both expect a greater fool to come along at a future date, so that you can offload it at a profit.

I don't, I'm staying put for years and I'm not getting involved in property profit shares.

As far as her, she's given up.

Perhaps it's the last bear turning bull

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There are far more economically savvy people on this forum than me, but you'd have to be a complete financial ignoramus to buy a house now imo.

Dave and Ozzie may as well be saying "In the name of Daddy's bonus, please buy a house."

If it looks like a tulip and smells like a tulip it's a fecking tulip.

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There are far more economically savvy people on this forum than me, but you'd have to be a complete financial ignoramus to buy a house now imo.

Dave and Ozzie may as well be saying "In the name of Daddy's bonus, please buy a house."

If it looks like a tulip and smells like a tulip it's a fecking tulip.

But it is hard now under these strange circumstances justifying being a renter, like me. A guy at work is buying and selling for £400k in the outskirts of London. He said to me, 'You could have bought instead of paying rent'. He said, 'You could have bought for £180k.' I'm earning about £25k a year and I'm to get into hock for £180k, or maybe less since I have some cash? Pfff. But no way! Even if I won the lottery I wouldn't buy at these silly prices.

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But it is hard now under these strange circumstances justifying being a renter, like me. A guy at work is buying and selling for £400k in the outskirts of London. He said to me, 'You could have bought instead of paying rent'. He said, 'You could have bought for £180k.' I'm earning about £25k a year and I'm to get into hock for £180k, or maybe less since I have some cash? Pfff. But no way! Even if I won the lottery I wouldn't buy at these silly prices.

Clearly you are fool not to buy with leverage like that!

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I dont blame her for wanting to get out of the clutches of landlords. Most landlords are just greedy and only interested in extracting as much rent as possible, whilst spending as little as possible on the property. They will throw you out with 2 months notice if they think they can get better rent from someone else.

I bought for that same reason.

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I must have been lucky with landlords then.

Was in one rented house for 3 years with no rent increases at all

The one we are in now have been here 4 years, I negotiated a rent decrease when we moved in (paying £25 a month less than the guy I knew that lived here before) and have had no rent rise since although they have had to do plenty of improvements to the walls, bathroom, windows etc. Would be very surprised if he did every try to raise it as he seems to be happy to not have any voids. Of course now we would quite like to move somewhere else so that I can have a home office (another bedroom with a desk in it) but because this place has stayed at the same price, everything else seems to have gone up by another £100 a month (including the next door house that our landlord also owns)

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I may be wrong, but I suspect borrowing among siblings usually ends up badly. it's ok with parents, because they are usually altruistic towards there children, but siblings don't usually have quite the same attitude.

How will the "profit share" work? Is it dependant on selling? Will you be contributing your fair share to maintenance and repairs? Even the daily cleaning and lawn mowing is something that contributes to the maintenance of the house's value. I think it would be very hard to calculate what was fair.

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I'd probably have lent her some money for the deposit (depends whether I'm likely to see it back) but would want a repayment schedule on it over the next few years, none of this profit-share rubbish.

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