House Buyers 2007.... Why?

Dymetrie · 07-11-2007, 23:28

Don't get me wrong, I think that owning your own house is a great thing, or could be a great thing, or might be a great thing...

But...

In 2007, why?

It's been proven that it's no longer a saving to own your own house and for someone like me (ie: unlikely to have children or even a family) then there seems little point.

To break it down...

Good Points:

You own it.
You can do what you want to it (within the terms of the lease).
It's something for your children to inherit (HA!).
It gives you security and equity.
It is your home.

Bad Points:

You own it.
Something ****s up, you have to deal with it.
It's something your children expect to inherit.
It is your home, for better for worse yada yada yada.

Twenty, even ten years ago then it made sense to own your own home, but more recently then it's making less and less sense. My brother bought his flat three years ago and since then has been paying twice as much as he was when he was renting (he's a teaching in London so it doesn't phase him, the git), but from my perspective then it makes no sense.

I like living where I am, but I enjoy the flexibility of being able to move, being able to change where I am, what I'm doing and so on. If I bought my own place then it'd either have to be with more people than I want to own a house with, or so far away from where I work that I'd spend more time travelling to and from work than I would at home (shush Stan).

Add to that the fact that if the boiler packs in (which it has) or the roof starts leaking (which it has) then I don't have to pay to fix it, I just have to swear at the right people the right amount and it gets fixed (joking there, I'm very nice and polite to the landlord.... *sniggers*)...

Considering the fact that I am always going to be me, am not going to have children and am likely to remain somewhat of a drifter, buying a property is not something that I find enticing.

Despite this then I have a lot of respect for my contemporaries (several of them are here *waves*) who have decided to take that option, but from my point of view then I can't understand it. Maybe it's because I live in London where everything is skewed anyway, or maybe it's just because it's not something I feel is an important or required investment.

Someone tell me why I should be looking to buy my own property. Then if they could tell me how....

Feek · 07-11-2007, 23:30

You shouldn't. For exactly the reasons you've described because in your situation, it would be a waste.

Dymetrie · 07-11-2007, 23:39

Quote:

Originally Posted by Fuifui Moimoi

As for house buying, it still costs me less after all the rate increases to pay my mortgage than it did to rent. If it was now, I'd probably not bother, tbh.

That's exactly what I'm getting at.

You've had your house/mortgage for a few years. Given the overinflated house prices and buggered up mortgage rates then what point is there in buying a house now? Especially in London where the prices have gone beyond the roof and are scraping the atmosphere!

Mark · 07-11-2007, 23:46

Turning stuff around to give a bit of balance.

A few pros to renting:

You can move around easily if you need to.
If stuff breaks, you can ask the landlord to fix it.
If the housing market sinks, you're not the one with negative equity.

And a few cons:

You get a **** landlord. They don't care if stuff breaks. You end up fixing it, or having to move.
You get a **** landlord who wants £10,000 p.a. for 'maintenance fees'.
Your rent payments line someone else's pockets. For you, the money is gone with nothing lasting to show for it.

However, for you, you're still relatively young and I suspect you're not settled yet. Don't tie yourself down before you're ready to do so.

With the housing market as it is, I'd advise anyone to give it serious thought first. Whether the market is going to sink, and if so how far, depends a lot on where you live (for London/SE England it doesn't look good), but with average prices apparently at 8x average earnings, I think some correction is likely - though I'm no expert and the real experts are very divided on the subject. If the market is on the downturn, now seems like a silly turn to buy, but that in itself would cause a downturn.

Dymetrie · 07-11-2007, 23:52

Quote:

Originally Posted by Mark

And a few cons:

You get a **** landlord. They don't care if stuff breaks. You end up fixing it, or having to move.

Mmmmm knowledge of housing law (both leasehold and tenanted) is good

Quote:

Originally Posted by Mark

You get a **** landlord who wants £10,000 p.a. for 'maintenance fees'.

That, my friend, is just daft

Quote:

Originally Posted by Mark

Your rent payments line someone else's pockets. For you, the money is gone with nothing lasting to show for it.

This is the only thing which you have said here which concerns me, and it doesn't even bother me that much. If you think about it then with a mortgage then you can pay a mortgage for 20 years, lining the bank's pockets, and then default on it and you can end up with nothing.

Or similarly have the same thing as happened with my family/father. Work hard for 20 years, split up with your wife, end up getting next to nothing out of the sale of the house...

Mark · 08-11-2007, 01:37

Quote:

Originally Posted by dymetrie

Mmmmm knowledge of housing law (both leasehold and tenanted) is good

Now I think about it, the second case was leasehold, but it happened. The other classic with leasehold where you have to cross someone else's property to get to yours is to randomly start charging 'access charges' - also of several thousand p.a.

As for the rest, knowing the law is one thing, enforcing it, well good luck if they've buggered off to god knows where and left a dodgy management company in charge. :/

Quote:

This is the only thing which you have said here which concerns me, and it doesn't even bother me that much. If you think about it then with a mortgage then you can pay a mortgage for 20 years, lining the bank's pockets, and then default on it and you can end up with nothing.

Or similarly have the same thing as happened with my family/father. Work hard for 20 years, split up with your wife, end up getting next to nothing out of the sale of the house...

All entirely true - but then I already suggested buying iwan't for you anyway (at least not yet).

kaiowas · 08-11-2007, 12:12

Personally I could never feel settled in rented accomodation. There was always the thought in the back of your mind that the landlord could at any point decide to give you your notice and sell up. Suddenly you're looking for somewhere else to live. Then there's the landlords rules to abide by, even doing something as simple as putting a nail in a wall to hang a picture on you'd have to make sure that you'd be able to tidy it up again before moving out. It just never felt like home.

Financially I think comparing rent to mortgage payments is a bit false. Whilst at the time you buy the house your mortgage payment may be more than you were spending renting, in the longer term rents will go up with inflation, mortgage payments will stay the broadly the same (obviously subject to rate increases). Assuming I haven't moved house/remortgaged then in 15-20 years time I know my mortgage payment won't be too much more than I'm paying now, how much will your rent have gone up in that period?

Admiral Huddy · 08-11-2007, 12:30

I agree with what Kaiowas says. When I look at my property and the mortage I have on it, it's nearly a third of what it would cost to rent. For example, my mortgage per month is £500 but next doors rent in nearly £1,400 per month. Yes, I bought it 10 years ago but if i had rented then, then the inflated cost of the rent would have cost me long term whereas the mortgage has remianed pretty much static.

However, I think anyone would be mad to move or buy at the moment. Not only is there the prospect of facing possible negative equity but to hand over all that hard earned cash in stamp duty.

I feel for first time buyers.

btw - you don't own a mortgaged propery until its fully paid off.

Matblack · 08-11-2007, 13:23

At most points in the economic cycle renting is a false economy, right now its probably the right thing to do until things shake down.

Our circumstances are different to most peoples, we bought at the right time and have been able to borrow money against our house to make improvments and still have equity in the property due to increasing house prices. Our mortgage is small enough and our building society flexible enough to enable us to own our house outright well within the next 10 years. At that point upscaling or major expenditure aside we will be mortgage free and be exceedingly well off by our own standards. This all happend because we bought at the right time, in my eyes now is not 'the right time' and there is little advantage in buying.

MB

Zirax · 08-11-2007, 14:26

There might be a crash, there might not. It depends on if you are buying a house for profit or buying to have a home. Yes the property is overvalued but I think that in the next few years having a house is going to become a real commodity. All the new builds recently are flats in my area. Where I am, 200k (minimum) for a new 2 bed flat or 200k for a 2-3 bed terraced. Would you truthfully buy the flat?

As someone who did buy this year, I would say that if you paid full market price (in the SE) then you are nuts. In my case as you all know I got a repossession property that was well below market rate. I have a pretty good idea of what its worth now, but there is no way I would pay that for it (but people are desperate and they will). Until they start building homes and not flats the demand is going to be there.

However you need to remember that I am outside of London and therefore relatively cheap when compared directly. I did look at renting, but landlords are cashing in on the fact that we are actually not that far from London. So my mortgage payments and bills come in the same amount as renting. Its clearly better to have an assett rather than just putting money into a pit. I do have an aim to be mortgage free asap (as does everyone), but I certainly think this is do-able within the timeframe I have set myself.

You raise an interesting point on the marriage and splitting front. Your best bet is to cover yourself as much as possible. In my family my cousin was done over by a gold digger. Within 5 mins of meeting the girl it was damn obvious what she was after but he was too stupid to realise.

07-11-2007, 23:28	#1
Dymetrie A large glass of Merlot Join Date: Jun 2006 Location: Letchworth with a Lightsaber Posts: 5,819	House Buyers 2007.... Why? Don't get me wrong, I think that owning your own house is a great thing, or could be a great thing, or might be a great thing... But... In 2007, why? It's been proven that it's no longer a saving to own your own house and for someone like me (ie: unlikely to have children or even a family) then there seems little point. To break it down... Good Points: You own it. You can do what you want to it (within the terms of the lease). It's something for your children to inherit (HA!). It gives you security and equity. It is your home. Bad Points: You own it. Something ***s up, you have to deal with it. It's something your children expect* to inherit. It is your home, for better for worse yada yada yada. Twenty, even ten years ago then it made sense to own your own home, but more recently then it's making less and less sense. My brother bought his flat three years ago and since then has been paying twice as much as he was when he was renting (he's a teaching in London so it doesn't phase him, the git), but from my perspective then it makes no sense. I like living where I am, but I enjoy the flexibility of being able to move, being able to change where I am, what I'm doing and so on. If I bought my own place then it'd either have to be with more people than I want to own a house with, or so far away from where I work that I'd spend more time travelling to and from work than I would at home (shush Stan). Add to that the fact that if the boiler packs in (which it has) or the roof starts leaking (which it has) then I don't have to pay to fix it, I just have to swear at the right people the right amount and it gets fixed (joking there, I'm very nice and polite to the landlord.... sniggers)... Considering the fact that I am always going to be me, am not going to have children and am likely to remain somewhat of a drifter, buying a property is not something that I find enticing. Despite this then I have a lot of respect for my contemporaries (several of them are here waves) who have decided to take that option, but from my point of view then I can't understand it. Maybe it's because I live in London where everything is skewed anyway, or maybe it's just because it's not something I feel is an important or required investment. Someone tell me why I should be looking to buy my own property. Then if they could tell me how.... __________________ Khef, Ka and Ka-Tet....

07-11-2007, 23:30	#2
Feek ex SAS Join Date: Jun 2006 Location: JO01ou Posts: 10,062	You shouldn't. For exactly the reasons you've described because in your situation, it would be a waste. __________________

08-11-2007, 12:12	#7
kaiowas The Stig Join Date: Jul 2006 Location: Fightertown USA Posts: 1,458	Personally I could never feel settled in rented accomodation. There was always the thought in the back of your mind that the landlord could at any point decide to give you your notice and sell up. Suddenly you're looking for somewhere else to live. Then there's the landlords rules to abide by, even doing something as simple as putting a nail in a wall to hang a picture on you'd have to make sure that you'd be able to tidy it up again before moving out. It just never felt like home. Financially I think comparing rent to mortgage payments is a bit false. Whilst at the time you buy the house your mortgage payment may be more than you were spending renting, in the longer term rents will go up with inflation, mortgage payments will stay the broadly the same (obviously subject to rate increases). Assuming I haven't moved house/remortgaged then in 15-20 years time I know my mortgage payment won't be too much more than I'm paying now, how much will your rent have gone up in that period? __________________ Anal Fish Porn

08-11-2007, 12:30	#8
Admiral Huddy HOMO-Sapien Join Date: Jun 2006 Location: Chelmsford Posts: 6,692	I agree with what Kaiowas says. When I look at my property and the mortage I have on it, it's nearly a third of what it would cost to rent. For example, my mortgage per month is £500 but next doors rent in nearly £1,400 per month. Yes, I bought it 10 years ago but if i had rented then, then the inflated cost of the rent would have cost me long term whereas the mortgage has remianed pretty much static. However, I think anyone would be mad to move or buy at the moment. Not only is there the prospect of facing possible negative equity but to hand over all that hard earned cash in stamp duty. I feel for first time buyers. btw - you don't own a mortgaged propery until its fully paid off. __________________ I just got lost in thought.. It was very unfamiliar territory. Techie Talk \| My gaming Blog \| PC spec \| The Admirals log

08-11-2007, 13:23	#9
Matblack Baby Bore Join Date: Jun 2006 Location: Svalbard Posts: 9,770	At most points in the economic cycle renting is a false economy, right now its probably the right thing to do until things shake down. Our circumstances are different to most peoples, we bought at the right time and have been able to borrow money against our house to make improvments and still have equity in the property due to increasing house prices. Our mortgage is small enough and our building society flexible enough to enable us to own our house outright well within the next 10 years. At that point upscaling or major expenditure aside we will be mortgage free and be exceedingly well off by our own standards. This all happend because we bought at the right time, in my eyes now is not 'the right time' and there is little advantage in buying. MB __________________ "we had roots that grew towards each other underground, and when all the pretty blossom had fallen from our branches we found that we were one tree and not two"

07-11-2007, 23:46	#4
Mark Screaming Orgasm Join Date: Jul 2006 Location: Newbury Posts: 15,194	Turning stuff around to give a bit of balance. A few pros to renting: You can move around easily if you need to. If stuff breaks, you can ask the landlord to fix it. If the housing market sinks, you're not the one with negative equity. And a few cons: You get a ** landlord. They don't care if stuff breaks. You end up fixing it, or having to move. You get a landlord who wants £10,000 p.a. for 'maintenance fees'. Your rent payments line someone else's pockets. For you, the money is gone with nothing lasting to show for it. However, for you, you're still relatively young and I suspect you're not settled yet. Don't tie yourself down before you're ready to do so. With the housing market as it is, I'd advise anyone** to give it serious thought first. Whether the market is going to sink, and if so how far, depends a lot on where you live (for London/SE England it doesn't look good), but with average prices apparently at 8x average earnings, I think some correction is likely - though I'm no expert and the real experts are very divided on the subject. If the market is on the downturn, now seems like a silly turn to buy, but that in itself would cause a downturn.

08-11-2007, 14:26	#10
Zirax Goes up to 11! Join Date: Jul 2006 Posts: 4,577	There might be a crash, there might not. It depends on if you are buying a house for profit or buying to have a home. Yes the property is overvalued but I think that in the next few years having a house is going to become a real commodity. All the new builds recently are flats in my area. Where I am, 200k (minimum) for a new 2 bed flat or 200k for a 2-3 bed terraced. Would you truthfully buy the flat? As someone who did buy this year, I would say that if you paid full market price (in the SE) then you are nuts. In my case as you all know I got a repossession property that was well below market rate. I have a pretty good idea of what its worth now, but there is no way I would pay that for it (but people are desperate and they will). Until they start building homes and not flats the demand is going to be there. However you need to remember that I am outside of London and therefore relatively cheap when compared directly. I did look at renting, but landlords are cashing in on the fact that we are actually not that far from London. So my mortgage payments and bills come in the same amount as renting. Its clearly better to have an assett rather than just putting money into a pit. I do have an aim to be mortgage free asap (as does everyone), but I certainly think this is do-able within the timeframe I have set myself. You raise an interesting point on the marriage and splitting front. Your best bet is to cover yourself as much as possible. In my family my cousin was done over by a gold digger. Within 5 mins of meeting the girl it was damn obvious what she was after but he was too stupid to realise.