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Lou G

Advice Needed Please

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Hi Everybody,

House in a location we like has come up. I am happy in rented but I suppose I am having one of those moments again!!!!

The house is in a desirable area and we would probably be there for many years to come so not looking to move. If we purchase and got a repayment mortage say at 5% it would be £ 993 a month. We are paying £1k a month in rent at the moment but the house is a higher council tax band so our council tax would go from £150 a month to £180 a month. We do have our STR funds gaining some interest in the bank but inflation is also eroding this away.

I am not clear as to the maths! Are we better buying or renting? I am fully aware that its the most expensive time to buy a house but I thought if I was more aware of the financial's it would help me make a decision.

Many thanks for any help,

Lou

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Hi Everybody,

House in a location we like has come up. I am happy in rented but I suppose I am having one of those moments again!!!!

The house is in a desirable area and we would probably be there for many years to come so not looking to move. If we purchase and got a repayment mortage say at 5% it would be £ 993 a month. We are paying £1k a month in rent at the moment but the house is a higher council tax band so our council tax would go from £150 a month to £180 a month. We do have our STR funds gaining some interest in the bank but inflation is also eroding this away.

I am not clear as to the maths! Are we better buying or renting? I am fully aware that its the most expensive time to buy a house but I thought if I was more aware of the financial's it would help me make a decision.

Many thanks for any help,

Lou

how much you going to offer against asking price Lou ?

(and will you stick to it?)

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House in a location we like has come up. I am happy in rented but I suppose I am having one of those moments again!!!!

The house is in a desirable area and we would probably be there for many years to come so not looking to move. If we purchase and got a repayment mortage say at 5% it would be £ 993 a month. We are paying £1k a month in rent at the moment but the house is a higher council tax band so our council tax would go from £150 a month to £180 a month. We do have our STR funds gaining some interest in the bank but inflation is also eroding this away.

I am not clear as to the maths! Are we better buying or renting? I am fully aware that its the most expensive time to buy a house but I thought if I was more aware of the financial's it would help me make a decision.

It depends entirely what view you take on the future direction of house prices and rental costs -- your buying costs will be about the same as renting (given that the repayment element of the mortgage is saving, not spending, but there will be some maintenance costs), so if you think that house prices when you move out will be the same or higher than they are now, or that rents will go up, then you're better off buying. If you think prices will be lower than they are now and that rents won't go up, then you're probably better off renting. If you're never planning to move out, you should probably buy, for the security of tenure and protection against rent increases.

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It was orignally on at £365 (overpriced) reduced to £335 last weekend. Rejected £320k!! but estate agents thinks they will accept £325k. The husband is keen to sell, the wife isn't keen to take an offer!!

It has interest from other parties too but the estate agents are keen on us as we are in rented and can move easily etc.!!! The vendors are living in Spain, property empty!!

I remember viewing a semi in this area in 2002/2003 for £250k so its not too badly priced for current conditions!!!

Lou

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They have accepted our offer of £320k.!

My hubby is delighted, over the moon etc etc. He loves it and it is somewhere we could be years, so why do I feel stressed! fed-up!, nervous, anxious etc etc. Is it because I feel like I'm following the sheep when I know its wrong (bubble!!) but at the same time it would be a new home to us and thats very important.

Don't want to upset my husband by telling him my feelings, do you think I should just bury my head and make a nice home for my family?

Lou

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I'm thinking that it's too late and you should have voiced your concerns earlier.

'Fess up now.

Depends how much you love the house though.

You're paying 30% more than what it was worth 3 years ago...

...but if the alternative is leaving a fat wedge of cash in the bank then perhaps you should buy.

For what it's worth, if it was me and the house was exactly what I wanted (esp. location) I would buy if the mortgage was the same or less than my rent.

Edited by DonnieDarker

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I know the feeling - good luck is all I can say - the best thing is you got a massive reduction on the original asking price.

It seems like you have a good deposit, and if you plan to stay there a long time then it is unlikely you will be in -ve equity (ie house worth less than mortgage value) even if you have a period when the house is worth less than you paid for it.

Edited by paradox

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For what it's worth, if it was me and the house was exactly what I wanted (esp. location) I would buy if the mortgage was the same or less than my rent.

It is!, based on 5% interest rates its just less than our current rent and its the best location. 5 x viewings booked in for the weekend and they have turned down 2 offers similar to ourselves but taken us as can move quickly. It would sell within the week. Market is very busy for the right property in the right location.

Think I will knuckle down and make a home.! Just have to try and wean myself of this site!!!!

many thanks.

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It is!, based on 5% interest rates its just less than our current rent and its the best location. 5 x viewings booked in for the weekend and they have turned down 2 offers similar to ourselves but taken us as can move quickly. It would sell within the week. Market is very busy for the right property in the right location.

Think I will knuckle down and make a home.! Just have to try and wean myself of this site!!!!

many thanks.

I expect I will be saying similar in approx 14 months.

IMO if the mortgage is similar to your rent and the property is in the exact location you want it then it's a no-brainer because if the market does go downstream faster there wont be anything available in the best locations. You have to be certain that the location you are buying in is a very very good one though.

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It is!, based on 5% interest rates its just less than our current rent and its the best location. 5 x viewings booked in for the weekend and they have turned down 2 offers similar to ourselves but taken us as can move quickly. It would sell within the week. Market is very busy for the right property in the right location.

Hrm, sounds like you've just come off the phone to the EA either that or you're possessed :blink:

It seems like you've already made your mind up, if it's a house you like and you can sit through any falls and handle the mortgage then it's your choice to make.

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Hrm, sounds like you've just come off the phone to the EA either that or you're possessed :blink:

It seems like you've already made your mind up, if it's a house you like and you can sit through any falls and handle the mortgage then it's your choice to make.

365K

335K

320K

I bet the seller is as exhilarated as you are Lou G...........five X viewings booked for the weekend, and they say bugger it we will lop another 15K off and go with the ones who can complete before this Whole Hill of Beans falls over.

I love these peeps who state it's not a problem maybe paying an extra 90K on a 25 year mortgage than you possibly needed too [circa 162K] if that ever comes to pass.

All I can say is, today I thought I had closed a 100 euro winning trade to later realise I had not closed that trade but instead opened up another trade. Not only did I lose the 100 Euro I thought I had won, but I actually lost another 100 Euro's on top. Fifteen minutes start to finish 200 Euro it cost me, now how would I handle a possible 162K bad decision **** up, who knows :unsure:

That said Lou G I hope your very happy in your new home, like I have said before in an overvalued market it is hard not to see below "realtime" asking prices as anything other than a bargain.

Jeez I just thought, have you considered if/when the market corrects big time you will be sat there thinking I BLOODY KNEW THIS WAS GOING TO HAPPEN :rolleyes:

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lou g

not wishing to rain on your parade but i think you are nuts

is the 5% interest , interet only?

what happens if irs go up to say 7% ( likely)

if prices crorcet by a meer 15% 5 over 2 years you would have saved £50k- equivalent to 4 years rent/ mortgage.

oh well money isnt everything

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Hi Everybody,

House in a location we like has come up. I am happy in rented but I suppose I am having one of those moments again!!!!

The house is in a desirable area and we would probably be there for many years to come so not looking to move. If we purchase and got a repayment mortage say at 5% it would be £ 993 a month. We are paying £1k a month in rent at the moment but the house is a higher council tax band so our council tax would go from £150 a month to £180 a month. We do have our STR funds gaining some interest in the bank but inflation is also eroding this away.

I am not clear as to the maths! Are we better buying or renting? I am fully aware that its the most expensive time to buy a house but I thought if I was more aware of the financial's it would help me make a decision.

Many thanks for any help,

Lou

The figures look good for buying, but are you considering the value of the deposit you will put on the house?

It would be best to compare the rent you are paying with a mortgage for the full price of the property.

A £320k mortgage for 25 years at 5% is £1333 interest-only and £1871 repayment.

Good luck if you do go ahead though.

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Hrm, sounds like you've just come off the phone to the EA either that or you're possessed :blink:

It seems like you've already made your mind up, if it's a house you like and you can sit through any falls and handle the mortgage then it's your choice to make.

and if you do, think about Locking In your interest rate. Interest Rates are low. They could go lower, but its not too likely. They are higher in a lot of places (not EU - very low but in America and Australia). If the economy goes pear shaped the interest rates will go up. The last crash was in a scenario of far higher interest rates. The BoE can't control them for ever. They have to have SOME relationship to reality. If you lock in at a low rate for a medium term at least you will be paying the same amount as others buying houses at lower prices and higher interest rates.

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Gosh, I really hate this boom! It makes normal decisions like buying a house so stressful!.!!!

long term money is hardly any dearer than the current rate......so consider a 15 year fixed rate loan to insure yourselves against IR rises down the line............

The rates available on these products are directly related to financial markets' expectations of future IRs and IMHO are TOO low........so go for one.........

In mainland Europe and the US it is considered financially imprudent at the best of times to take out the variable rate mortgages the British have always gone for............Prior to 1970 it never mattered as credit was so tightly rationed they never had to raise IRs to cool down demand.......since then people with large mortgages have had a roller coaster ride with the old interest rate movements.

As for your potential purchase generally.......... go for it if you think you'd like to live there for many years......

Now i'm being very cheeky.....but you needn't be specific......Is it on the south side?.......Saints estate?......Leeds Rd?........the Boulevards?.........Pannal Ash?.........Jennyfield?.....Bilton?

Edited by Michael

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long term money is hardly any dearer than the current rate......so consider a 15 year fixed rate loan to insure yourselves against IR rises down the line............

The rates available on these products are directly related to financial markets' expectations of future IRs and IMHO are TOO low........so go for one.........

In mainland Europe and the US it is considered financially imprudent at the best of times to take out the variable rate mortgages the British have always gone for............Prior to 1970 it never mattered as credit was so tightly rationed they never had to raise IRs to cool down demand.......since then people with large mortgages have had a roller coaster ride with the old interest rate movements.

As for your potential purchase generally.......... go for it if you think you'd like to live there for many years......

Now i'm being very cheeky.....but you needn't be specific......Is it on the south side?.......Saints estate?......Leeds Rd?........the Boulevards?.........Pannal Ash?.........Jennyfield?.....Bilton?

Thanks and yes its south side and none of the above! hence we could be there for many years. !!!

Still nervous about this!!!!

Lou

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Thanks and yes its south side and none of the above! hence we could be there for many years. !!!

Still nervous about this!!!!

Lou

http://www.rightmove.co.uk/viewdetails-412...pa_n=6&tr_t=buy

this one........?

or this one ?

http://www.rightmove.co.uk/viewdetails-872...pa_n=6&tr_t=buy

Edited by sign_of_the_times

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  • 335 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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