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Monkey

Are You Better Off Renting Or Buying?

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When is the Torygraph going to formally apologise to Gordon Brown? Clearly the vilification that's been heaped on him for causing the biggest housing bubble in UK history is unfair and unwarranted. In the light of Osborne's subsequent efforts the only criticism the paper can have is that Brown didn't go far enough. Oddly enough, the principal accusation the Tories leveled against him during his time as Chancellor was that the regulatory authority he established was too severe...

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The propaganda is strong with this one.

It returned 'buying is never better than renting" if I used my current rent (small property) but bought the size of property I would want to own (another 32m2)

it returned '20 years' if I paid the appropriate level of rent now for the type of property I'd buy.

I used 35% deposit and 5% mortgage interest

With agent's fees and stamp duty - as you may well move over a 20 year period - buying is unlikely to ever be a good bet in the South West - under current conditions - as I suspected. Reassured.

Edited by LiveinHope

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Where's the return on the investments you will make instead of sticking every penny you earn on a leveraged bet on UK residential property? Maintenance and insurance? Stamp duty every time you want to move?

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Where's the return on the investments you will make instead of sticking every penny you earn on a leveraged bet on UK residential property? Maintenance and insurance? Stamp duty every time you want to move?

Opportunity cost is always overlooked by those with a vested interest in convincing people to buy property.

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My personal result. laugh.gif

Buying is neverbetter than rentingin this scenario

I never actually thought of trying the propaganda widget so went back an having a look at it.

Renting is a winner for me and that's without a box to put in for maintenance, fees etc nor is there a box for the £60K loss the people who bought my last house off me made.

As I suspected renting is a winner.

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As others have said, the absence of maintenance and opportunity costs, while incorporating such overall trivialities such as £60 for an EPC seem to indicate it is designed to give an impression of thoroughness while ensuring the dice are loaded.

I'm loving the default 3% interest rate for the full 25 year term too, put in something more reasonable and watch how it changes.

Constant ramping now, not the Telegraph was averse to it in any case.

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As others have said, the absence of maintenance and opportunity costs, while incorporating such overall trivialities such as £60 for an EPC seem to indicate it is designed to give an impression of thoroughness while ensuring the dice are loaded.

I'm loving the default 3% interest rate for the full 25 year term too, put in something more reasonable and watch how it changes.

Constant ramping now, not the Telegraph was averse to it in any case.

The Telepgraph is especially bad....worse than that are the telegraph readers....had a run in with my inlaws yesterday...BUY NOW....LONDON IS BOOMING ( AND WILL NOT CRASH )....WHY ARE YOU RENTING.

It's in the paper...it must be true...even if it's contrary to my 5 years of research and various facts.

VOTE TORY THEY WILL SAVE US.....

Edited by TheCountOfNowhere

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Well, thougth I might as well remind myself with my usual back of envelope calculation.

3 bed housse in balham, hydefarm seem to be on rightmove at 800 to 850k, say 40k p.a. at 5%.

A couple available to rent at 490 and 570 p.w., that's about 25 to 30 k per annum. That seems like a pretty clear loss situation to me. I have seen rental prices at up to 650 p.w., that's 34k p.a., so you might just about break even with a mortgage at 4%, no voids, and no maintenance costs. Utter madness.

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the view out of the bedroom french windows, the recent ( last week) replaced double glazing, the double entrance gravel drive with parking for 10 cars, garage, shed, washroom, coal bunker, 4 double bedrooms, 20 ft lounge, dining room and kitchen with breakfast bar, renting will NEVER be more expensive than buying this place,

I am truly spoiled for with the rent, we could achieve a 2 bed flat to buy.

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This varies massively across the country and is why I moved about a year ago from Derbyshire to Gloucestershire. In Derbyshire rent is typically half the interest on a ftb mortgage. In Gloucestershire the rent is typically about the same as the full repayment on a ftb mortgage. I realised i would never buy in Derbyshire where the sums did not add up, so i moved to somewhere where they did.

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You are better off buying when prices are low and you think they may rise.

You are better off renting when prices are high and you think they may fall.

I am better off renting at the moment.

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the view out of the bedroom french windows, the recent ( last week) replaced double glazing, the double entrance gravel drive with parking for 10 cars, garage, shed, washroom, coal bunker, 4 double bedrooms, 20 ft lounge, dining room and kitchen with breakfast bar, renting will NEVER be more expensive than buying this place,

I am truly spoiled for with the rent, we could achieve a 2 bed flat to buy.

Marvellous, 10 cars and shed as well! ;)

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..VI rubbish for financial illiterates ...buying / renting is a personal strategic assessment..not a few jabs at a calculator ...short term high for long term misery and that sinking feeling of being tied to the millstone as the tide comes in ...is no dream in this land of political cheap sales.... :rolleyes:

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Those that are renting are you still saving for a deposit our investing the money elsewhere (stocks n shares , savings account etc.) Or are you just living month to month with a view that uf you fancy a new area you just go and use all your money to keep level?

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Those that are renting are you still saving for a deposit our investing the money elsewhere (stocks n shares , savings account etc.) Or are you just living month to month with a view that uf you fancy a new area you just go and use all your money to keep level?

..there are two modes in house property ..snakes and ladders...before Labour trashed the economy we had decades of the ladder ...despite Government financial splints we are now facing decades of the snake ... :rolleyes:

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Some of the reader comments, absolute unquestioning belief in house prices HPI. Mixed a few below. Friends parents just upsized to a £500,000 house in their mid 60s, 5 beds, outbuilding, land, when their 3 adult children rent many miles away. Justified by having necessary rooms when their family come to visit at Christmas ect. Instead of downsizing and tax-planning for their renting children. Too much focus on self + thinking house prices only go up. No sense of value either.

I hope we're reaching the end of hpc-ers willingness to throw themselves and every other none owner under buses whenever there is a report of some big mortgage debtor who were 'victims of media' and 'just wanted a home', even though many are still buying trying to buy at excessive prices. Policies to protect them only supports the older HPI positions. These people, with their locked in HPI, fully expecting another round of runaway HPI.

Almost without exception my colleagues who stayed in the UK bought, rather than rented, and I don't know anyone who hasn't paid off all, or most, of their 1-300k mortgages on properties which have increased to between 600k and 1.5 million in the south. That is real money, and they are rich: if they sold-up and banked it, and rented a home. They have half- to one million in equity - that's folding cash - to show for it. Learn from my mistake - Do Not Rent.

How does renting ever make sense? Sure, interest rates will doubtless go up at some point, but that will put up landlords' mortgages too, so rents will also increase. Learn from history, never rent. In your example, after 25 years of renting you will certainly have no asset. 25 years of paying the interest measn 25 years of controlling the asset that is the house, which means you get to keep all the capital gain. Values adjusted for inflation trebled since 1975. The 2/3 are yours to keep.

Conrad Vink

• 10 hours ago

2013 is not 1975. Get ready for a new phrase: capital loss.

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