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dryrot

'we're Not Gay, Just Priced Out': The Minefield Of Buying A Flat With A Friend. D Tele.

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Hi

not particularly groundbreaking, but an MSM sign o' the times...

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/11825267/Were-not-gay-just-priced-out-The-minefield-of-buying-a-flat-with-a-friend.html

"Disclosing salaries and confessing debts, Ed Monk shares the challenges of buying with a friend, including some odd reactions"

Ed Monk is apparently "Investment Editor" of the Telegraph.

"In reality we were from a different minority group – friends or siblings, despairing of their chance of buying via the conventional channels, clubbing together to get on the ladder.

[...]

Irrecoverable costs such as stamp duty and fees to solicitors amounted to around £10,000. Our mortgage deal meant that we’d repay about this much of the debt over two years, while our monthly repayments were close to what we were paying in rent. So, assuming no movement in prices, we’d have recovered the cost of buying from savings in rent in two years. If prices went up we’d be better off, if they went down we’d be worse off."

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[..]Ed Monk is apparently "Investment Editor" of the Telegraph.

:lol:

Hurry up and buy Ed Monk.

Last time around it was Ed Conway the Economics Editor of the Telegraph who bought just before the peak.

2008 http://www.telegraph.co.uk/finance/property/property-market/wordonthestreet/3360981/Property-market-Word-on-the-street.html

Maybe we won't have another repeat of bailout stimulus HPI smoothing next time.

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:lol:

Hurry up and buy Ed Monk.

Last time around it was Ed Conway the Economics Editor of the Telegraph who bought just before the peak.

2008 http://www.telegraph.co.uk/finance/property/property-market/wordonthestreet/3360981/Property-market-Word-on-the-street.html

Maybe we won't have another repeat of bailout stimulus HPI smoothing next time.

Maybe....Defo

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I hope non-gay Ed and his non-gay house buying mate get crushed in the HPC. Praying they are on an I/O deal or a short term fix.

Yet another shill for the housebuilders and rent seekers.

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Maybe he should take a job at the Daily Mail. Is their finance editor priced out?

Seems like he has a position there too?.

June 2015. 'incredible' / 'instability the Bank wants to avoid' - 'sudden tax change won't be the way it's done' -in your opinion matey, and it's tax relief changes has now been set out for the future.

Given the Bank of England has identified the potential need for a limit to ensure buy-to-let lending remains safe, it would be incredible if it then sanctioned a change that suddenly meant many landlords fell short of this level and had to sell up in large numbers. That's exactly the instability the Bank wants to avoid.

This is not to say the current position is satisfactory. It cannot be a good thing that changes that would potentially improve fairness in the system can't happen because the property market is effectively to big to fail.

There may be good reasons to dissuade landlords from buying an ever greater share of UK homes, but a sudden change on tax won't be the way it's done.

http://www.thisismoney.co.uk/money/buytolet/article-3120114/ED-MONK-landlords-really-tax-advantage-Yes-no-removed-No-chance.html

Edited by Venger

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Didn't shared buying go on towards peak of 1988-89. And 2006-07. Anyway he came out strong against adjustment to landlord tax relief just weeks before it occurred, and from my reading, has now bought with his mate in Crystal Palace.

Maybe....Defo

That's why we get along so well Count.

. Ones who will end up each buying a house for our families at much more reasonable value than in current market where buyers pushing and falling over themselves to pay silly high prices and seeing no end to BTL / no end to HPI.

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In our case, my housemate Alex and I had spent several years living in the same rented house in Balham, south-west London. The idea was Alex’s and came about after a third housemate left to buy a place of his own.

We managed to find another friend to replace him, but then that started to look uncertain too. This is what renting with other people is like.

He didn't like that his housemates in rentals kept leaving to pursue their interests in life, so he decided instead to arrange things so that when his co-buyer also eventually leaves to pursue his interests in life it will be a really expensive transaction.

Edited by Dorkins

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This is exactly the type of story that was around in 2005/2006/2007. I guess these guys were having too much fun in their early twenties to care about buying a house back then, and I don't blame them.

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Hi

not particularly groundbreaking, but an MSM sign o' the times...

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/11825267/Were-not-gay-just-priced-out-The-minefield-of-buying-a-flat-with-a-friend.html

"Disclosing salaries and confessing debts, Ed Monk shares the challenges of buying with a friend, including some odd reactions"

Ed Monk is apparently "Investment Editor" of the Telegraph.

"In reality we were from a different minority group – friends or siblings, despairing of their chance of buying via the conventional channels, clubbing together to get on the ladder.

[...]

Irrecoverable costs such as stamp duty and fees to solicitors amounted to around £10,000. Our mortgage deal meant that we’d repay about this much of the debt over two years, while our monthly repayments were close to what we were paying in rent. So, assuming no movement in prices, we’d have recovered the cost of buying from savings in rent in two years. If prices went up we’d be better off, if they went down we’d be worse off."

I don't think Ed knows what a mortgage is! How can the Investment Editor be so innumerate!

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You'd have to trust someone quite a lot to get a joint mortgage with them... however, if you know you are going to be in an area for a while and you were going to rent with your friends anyway in a house share I can see buying makes perfect sense financially. It is a bit of a coin flip between having a "professional" landlord or trusting your friends with your finances. Both could be a good or a bad experience.

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I don't think Ed knows what a mortgage is! How can the Investment Editor be so innumerate!

I was trying to work out the repayment etc. If they will pay off £10k in the first two years thats ~£500 per month repayment. What is the interest portion per month?

EDIT:

"Irrecoverable costs such as stamp duty and fees to solicitors amounted to around £10,000. Our mortgage deal meant that we’d repay about this much of the debt over two years, while our monthly repayments were close to what we were paying in rent."

How much was the flat. It mentions "hundreds of thousands"

Edited by dryrot

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They're young - so they could also buy an iPad between them (saving on that massive cost that often precludes the young from buying property).

And share a mobile phone contract too, that should get them a couple more steps up the ladder.

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I was trying to work out the repayment etc. If they will pay off £10k in the first two years thats ~£500 per month repayment. What is the interest portion per month?

EDIT:

"Irrecoverable costs such as stamp duty and fees to solicitors amounted to around £10,000. Our mortgage deal meant that we’d repay about this much of the debt over two years, while our monthly repayments were close to what we were paying in rent."

How much was the flat. It mentions "hundreds of thousands"

Lower end of the (London / Crystal Palace surrounding) price scale imo. £220K-£350K at a guess. Just going from the pic of the wood-clad kitchen.

I find that kitchen photo quite haunting. Like a peaky reference photo, pre HPC.

..Like so many 30-somethings, I could feel the time coming when I just wouldn’t have enough working life left to repay a mortgage.

I'll wait for values to fall, so my deposit goes further, and easier to pay down smaller mortgage principal.

...Our situation as friends buying together had other effects on our choice. Fix-me-uppers were off the menu as we couldn’t bank on being there long enough to undertake serious improvements. We eventually found a flat a few miles away in Crystal Palace, south-east London.

You wouldn't want to be stuck their, deposit wiped out, into a HPC. Then such shared-buyers might be stuck there.

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He didn't like that his housemates in rentals kept leaving to pursue their interests in life, so he decided instead to arrange things so that when his co-buyer also eventually leaves to pursue his interests in life it will be a really expensive transaction.

Yes, isn't it amazing how little people seem to value their financial independence and flexibility. Housing is a sh*t sandwich either way in the UK but this approach is absolutely fraught with risk.

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Yes, isn't it amazing how little people seem to value their financial independence and flexibility. Housing is a sh*t sandwich either way in the UK but this approach is absolutely fraught with risk.

This is a major hassle in London for older, single renters like me. A multiple-occupancy is no longer a desirable lifestyle, but a 1-bed flat is an expensive alternative. A shared flat is financially ideal but there are two major pitfalls - Firstly, flatmates can be pretty transient (I've had 4 in 2 years) and replacing them can be stressful. Secondly, a nightmare flatmate can be hell. Get one of those and suddenly spending a king's ransom on buying a place might even seem quite tempting.

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Yes, isn't it amazing how little people seem to value their financial independence and flexibility. Housing is a sh*t sandwich either way in the UK but this approach is absolutely fraught with risk.

Very much agree. I go for the more flexible shitty option. It suits me better.

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