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DD2013

Buy In Next 6 Months Or Stay Put Renting?

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Girlfriend & I looking to buy first house after rent contract expires end of April. The mainstream media are portraying this message that people must buy NOW because house prices are increasing at a record rate. But then people are saying be careful because if/when interest rates boom we'll be left with an unaffordable mortgage in a couple years time. Is that true? Neither of us earn particularly high wages and are being stretched each month as it is renting.

I'm no expert in the field but do have common sense. Whilst we'd love our own house I'd sooner rather put up with the 'renting is dead money' brigade for a while longer than buy a house and find ourselves in an impossible situation further down the line.

My question to the experts here is....is the next 6 months the right time to buy or not?

Thanks in advance.

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No expert, I'm a mad idiot. I've been pissing about watching prices go up in areas I've looked at, hoping for falls to no avail. Mortgage payments on a place I missed out on last year due to stubbornness were tiny. I'm a real idiot for thinking that the price of something which the majority of people hold will go down to reasonable levels. Each day seeing these bloody sold sold sold sold sold sold boards everywhere just rubs it in.

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No expert either. My guess is whenever you buy is gonna be too late anyway.

No expert here. What I do know is that either way you are going to be significantly worse off than you should be, due to bad political leadership. You are going to see more of your income go on housing costs that was ever imagined 30 years ago. Just make sure you punish LIBLABCON at the next election - and write to your MP to explain why.

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you are asking yourself the wrong question. i refused to buy for 10 years because there was NOT A SINGLE property in the areas i was looking for that i thought was value for money. after 10 years i found a house that i thought was fair value for money and the figures/mortgage everything stacked up versus renting.

if that house hadnt come on the market at the price it did i doubt i would be buying anything.

the thing i would be wary of if i was you would be to decide that you MUST buy something in the next 6 months and then get funneled into buying something because you have made the decision.....the saem thing when i buy a car, i will wait for 3 months, 6 months until the genuine bargain pops up. dont be rash or hasty...be relaxed and act like buyers need you more than you need their house. and whatever you do DONT fall in love with a house....EA's will smell this a mile away and milk you like a fresian cow!

for me it was simple, as soon as i saw the house, and the distressed seller price i knew my 10 year wait was over....then i knocked another 12.5% off by having a very good poker face.

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Will houses be overpriced in 6 mths time? Yes, they definitely will.

Will rents still be absurd in 6 mths time? Again, yes, most definitely.

Mrs Caveat and I bought in Sept. We bought with a small mortgage (circa 2x single salary). The price we paid was 35% down on price a paid by people 3 doors up (similar house except ours has an extension).

We paid 2002 price plus 3%. Our monthly mortgage payment is less than we had been paying on rent, and overpayments mean we will have paid nearly half the mortgage by the time our 3 year fix expires. We have no worries about prices falling or interest rates rising, we can easily cope with both and would like to see them happen.

However, we could easily have paid much more. We knew all along we only wanted to buy one house and had to look at (and overlook) many many houses over a period of years before finding a house which represented a financial commitment we were happy with.

So, its for you to find something you are comfortable with. Does the house represent good value for money compared to prices paid over the last 3 / 5 / 10 years? Can you afford the mortgage? Can you overpay during the fixed period to reduce exposure to interest rate rises? Are you happy to make a 10 / 15 / 25 year commitment to pay the price you can agree today?

The answers to those questions will vary wildly depending on geographic location, levels of vendor delusion, and the stupidity of other buyers buoyed with HTB mortgages.

Good luck

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You should probably do some calculations regarding what you could afford if interest rates went up/what a fixed rate for 5-10 years might cost?

Then also consider whether you plan to be with your girl friend for the next 10-20 years, whether the house would suit your long term plans eg for offspring, job security, likely income progression, other expenses eg insurance, repairs, etc

Personally, if any of these looks marginal or uncertain - then it might be worth waiting. Renting is frequently crap but at least you can always move. An unsuitable house purchase is far harder to recover from.

Edited by StainlessSteelCat

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i also knew it felt right to buy when i ran the numbers. 10% deposit, 7 year fix, 13 year mortgage. and i pay less than renting. if houses crash 50% i dont care. if interest rates go to 15% i dont care. i will sit back and enjoy the fireworks.

i will be mortgage/rent free in 9 years, that is what did it for me!

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i will be mortgage/rent free in 9 years, that is what did it for me!

"If you want to make God laugh, tell him about your plans"

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Since moving to Ireland we tried no less than 6 times to buy various houses. Each time we were either gazumped, the seller decides they don't want to sell to an English couple (most often) or we were outbid.

Upshot of all that is, I lost my job at the end of December and am so glad I didn't buy anywhere as I am now free to pick and choose jobs here or back in the UK. I also didn't part with any money for stamp duty, solicitor fees, house repairs, surveys etc.

I found even with a healthy deposit or even cash, it was marginal price difference between buying and renting.

Often if you add up the buying/selling fees it doesn't pay to buy a house if you are not going to stay there for 10 years. That is why most people NEED more money when they sell the house as they need to recoup their losses on the buying costs of the house they are moving from and the one they are moving to.

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the closest ive been to an estate agent is a car salesman in a previous life. up in the northern wastelands houses are cheaper than a parking space in that cesspit they call London and the SE. and we dont have to pay a fortune to stand cramped next to miserable commuters who are so depressed its written all over their face. We also dont have to pay £70 in a cab to get from one side of the cesspit city to the other.

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