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Should I Rent Or Buy Now?

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Hello friends,

I have a question.

I wanted to buy a flat 2 years ago. Common sense told me that a smelly filthy dump should not be worth £270, 000. Despite what "The Market" is for such things, I just felt wrong buying horrible place for so much money. So, I waited and have been waiting ever since and watching this forum.

I am currently renting a one bedroom flat in London. Each year I pay £12,000 to the greedy landlord to pay the flat off for him.

Now, if I wait for the crash, it may take 5 years or even longer to hit the bottom. In 5 years, I would have given the landlord £60,000. So my question is this;

Is there any point in waiting for a crash? Am I not better off just buying now and using that £60,000 toward an overpriced place now?

Thanks for your help.

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But you'd be paying £14850 p/year interest on mortgage, if you take a typical 5.5% mortgage. That's without any repayment of your capital.

Edited by Tonester

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Hello friends,

I have a question.

I wanted to buy a flat 2 years ago. Common sense told me that a smelly filthy dump should not be worth £270, 000. Despite what "The Market" is for such things, I just felt wrong buying horrible place for so much money. So, I waited and have been waiting ever since and watching this forum.

I am currently renting a one bedroom flat in London. Each year I pay £12,000 to the greedy landlord to pay the flat off for him.

Now, if I wait for the crash, it may take 5 years or even longer to hit the bottom. In 5 years, I would have given the landlord £60,000. So my question is this;

Is there any point in waiting for a crash? Am I not better off just buying now and using that £60,000 toward an overpriced place now?

Thanks for your help.

FGS - you have been lurking here for two years, and you can't even see how foolish this post was.

Please tell me what the interest would be on your mortgage?

I'll give you an insight.....£30k deposit = £240,000K mortgage.

Interest @ 6% in a single year on £240,000K is £14,400.

So you are not throwing money away. Both solutions cost you money. Why does everyone forget that? It makes my blood boil.

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Welcome to HPC.

There's about 17,392 similar first posts in the archive. Have a wander around and see if your question has been answered once or twice already.

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Guess it depends on where you think house prices are going.

Your landlord is subsidising you to live in his place by charging you rent that is lower than mortgage interest would be.

If you think prices are going down, buying would be a foolish decision financially.

If you think prices are going up then go for it.

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The best time to buy is when property prices are falling at a slower rate than the difference between the rental / mortgage interest payments.

EG

Houses are 200k but falling 0.5% a month. monthly depreciation is 1k.

Assuming 6% mortgage rate, monthly interest payment is 1k.

So rent would have to be over 2k for it to be worth buying.

That's not factoring in maintenance, but I consider maintenance a trade off to the freedom of having your own pad. Depends what value you put on it.

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Guest The_Oldie
Hello friends,

I have a question.

I wanted to buy a flat 2 years ago. Common sense told me that a smelly filthy dump should not be worth £270, 000. Despite what "The Market" is for such things, I just felt wrong buying horrible place for so much money. So, I waited and have been waiting ever since and watching this forum.

I am currently renting a one bedroom flat in London. Each year I pay £12,000 to the greedy landlord to pay the flat off for him.

Now, if I wait for the crash, it may take 5 years or even longer to hit the bottom. In 5 years, I would have given the landlord £60,000. So my question is this;

Is there any point in waiting for a crash? Am I not better off just buying now and using that £60,000 toward an overpriced place now?

Thanks for your help.

As an example, I'm paying over £10K per year in rent to my (very nice) landlord. This is not wasted money as I receive the use of a house in return.

Alternatively, I could buy the overpriced house next door for £400K, although if I were to do so, I would lose over £20K per year in interest on that £400K.

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This question is asked and answered pretty regularly on this board so you may not get a shower of full answers.

.

The obvious points are,

- If houses depreciate rapidly how much will you loose to negative equity (

- How much will you be flushing down the loo in interest. Where I live all rents are much cheaper than an IO mortgage on the same property.

.

ST

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Mods: seriously now, these "is now a good time to buy" posts are really getting tedious.

Can't we have a seperate forum where they can get moved to and keep our blood pressure down?

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Probably just a bored EA trying to get a bite...and succeeding by the looks of it.

Some people really are just "not that clever" no offense meant OP.

Did you not notice there was a housing bubble going on? That requires plenty of people to be "not that clever".

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Welcome to HPC.

There's about 17,392 similar first posts in the archive. Have a wander around and see if your question has been answered once or twice already.

A unique post surely! I haven't seen anything like it before.

Regards

Rip Van Winkle

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Now, if I wait for the crash, it may take 5 years or even longer to hit the bottom. In 5 years, I would have given the landlord £60,000.

The biggest falls usually happen in the first two or three years. Much more than £12,000 a year will be coming off a £270,000 property.

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I thought the whole point of this site was to determine when is the right time to buy? If we don't continually keep asking this question then we could miss the boat.

alright at the moment it's not a good time to buy but tomorrow...?

Welcome to HPC Toilet.

If you're a troll, a bored EA, a BTL'er in trouble or merely a human being like most of us then it makes no difference you at least deserve a curteous welcome :)

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Hello friends,

I have a question.

I wanted to buy a flat 2 years ago. Common sense told me that a smelly filthy dump should not be worth £270, 000. Despite what "The Market" is for such things, I just felt wrong buying horrible place for so much money. So, I waited and have been waiting ever since and watching this forum.

I am currently renting a one bedroom flat in London. Each year I pay £12,000 to the greedy landlord to pay the flat off for him.

Now, if I wait for the crash, it may take 5 years or even longer to hit the bottom. In 5 years, I would have given the landlord £60,000. So my question is this;

Is there any point in waiting for a crash? Am I not better off just buying now and using that £60,000 toward an overpriced place now?

Thanks for your help.

You mean, should you give that 60,000 to a greedy bank in interest charges?

Rent is dead money, whatever happened to interest is dead money?? Do you understand debt isn't free?

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Probably just a bored EA trying to get a bite...and succeeding by the looks of it.

No not an EA. I had given the interest payable some thought, but ignorantly, had not calculated it to the specifics. My reasoning is blinded by the fact I am paying so much money to this ogar for such a tiny little flat in a conversion. I can hear the loud italian students upstairs having sex and arguing. It makes me sick I'm paying so much for this.

I guess my question has been answered. Thank you.

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Is there any point in waiting for a crash? Am I not better off just buying now and using that £60,000 toward an overpriced place now?

Thanks for your help.

No point in waiting for crash and yes you are right and would be better off buying now.

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Hello friends,

I have a question.

I wanted to buy a flat 2 years ago. Common sense told me that a smelly filthy dump should not be worth £270, 000. Despite what "The Market" is for such things, I just felt wrong buying horrible place for so much money. So, I waited and have been waiting ever since and watching this forum.

I am currently renting a one bedroom flat in London. Each year I pay £12,000 to the greedy landlord to pay the flat off for him.

Now, if I wait for the crash, it may take 5 years or even longer to hit the bottom. In 5 years, I would have given the landlord £60,000. So my question is this;

Is there any point in waiting for a crash? Am I not better off just buying now and using that £60,000 toward an overpriced place now?

Thanks for your help.

Firstly - do not balance the interest you pay on the mortgage against the rent. This is a mistake many people make. If you pay a mortgage you get to decide what colour to paint the walls - a vital benefit, apparently.

Secondly, BUY NOW! Do not waste a single penny more on rent when there are so many NEEDY BANKS! Give the banks their due. Your country needs you. A banking crisis must be averted and you paying them good interest to RENT A HOUSE OFF THEM INSTEAD OF A LANDLORD MAKES GOOD SENSE. Unless, of course, the Landlord is already paying interest to a bank because he has a mortgage on the place and, in that case, is acting as a middle man.

Middle men are surely to be encouraged. Where would the world be without them?

Buy now. Buy soon. Buy quickly. Before you lose out. Don't go to bed tonight without having made an offer. Hand in your notice now. Breathe deep! Gulp in the fresh air of part ownership/part rent from a bank. Live long and prosper!

Edited by Lets' get it right

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I find the 'rent is wasted money' argument a strange one. The cost of living where you live is obviously very expensive if a one bed flat is £1,000 a month - one solution is to move somewhere cheaper where rent isn't so high?

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FGS - you have been lurking here for two years, and you can't even see how foolish this post was.

Please tell me what the interest would be on your mortgage?

I'll give you an insight.....£30k deposit = £240,000K mortgage.

Interest @ 6% in a single year on £240,000K is £14,400.

So you are not throwing money away. Both solutions cost you money. Why does everyone forget that? It makes my blood boil.

I use the same kind of examples with all my friends and family who question my actions (sold up E/2006) - sometimes I'm sure they think I'm making it all up :rolleyes:

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I find the 'rent is wasted money' argument a strange one. The cost of living where you live is obviously very expensive if a one bed flat is £1,000 a month - one solution is to move somewhere cheaper where rent isn't so high?

Yeah, like Canada

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  • 293 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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