Buying a house
Moderators: Aladinsaneuk, MartDude, D-Rider, Moderators
- Aladinsaneuk
- Aprilia Admin
- Posts: 9503
- Joined: Wed Jan 03, 2007 10:37 pm
- Location: Webfoot territory
its always been a gamble gio - and you can be certain that the mortgage advisor will be tying people into a fixed term offer... if they don't then find a better one
and being honest, the mortgage is currently less than a rent....
and being honest, the mortgage is currently less than a rent....
Let's face it, you wouldn't go to a nurse to get good advice on a problem with a Falco - you'd choose an Engineer or a mechanic...
Gio,
The base rate is 0.5%, full rate in our situation will be around 4.6- 5% , fixed for 5 years.
If the base rate fell to 0.25%, the difference would be negligible.
We are currently throwing £4500 a year down the drain in rent alone, never mind the difference in council tax bands and the cost of heating a massive house, and the £450 water bill we got last quarter (5 in the house). I'd rather build equity then help a land lord build equity.
Besides, i would not want to be buy a house when the interest rates start increasing again! repayments would be insane!
Dale
The base rate is 0.5%, full rate in our situation will be around 4.6- 5% , fixed for 5 years.
If the base rate fell to 0.25%, the difference would be negligible.
We are currently throwing £4500 a year down the drain in rent alone, never mind the difference in council tax bands and the cost of heating a massive house, and the £450 water bill we got last quarter (5 in the house). I'd rather build equity then help a land lord build equity.
Besides, i would not want to be buy a house when the interest rates start increasing again! repayments would be insane!
Dale
- flatlander
- Eprom Test Pilot (Stig)
- Posts: 3097
- Joined: Tue Jun 14, 2011 9:06 pm
- Location: cheshire
cgt not applicable on your primary residence IIRC and your primary residence is judged on quality of occupation not quantity meaning its not how long you lived there its how much you lived there
mortgage = rent with possibilities of gain you don't lose
If I could get a fixed rate for the life of the mortgage I would be biting their hands off ....
yay bring back the crazy irresponsible ways at least we had money even if it was someone else's!
mortgage = rent with possibilities of gain you don't lose
If I could get a fixed rate for the life of the mortgage I would be biting their hands off ....
yay bring back the crazy irresponsible ways at least we had money even if it was someone else's!
For the avoidance of doubt and for the benefit of my wife, not everything I may say here will be absolutely true I may on ocassion embellish a little for effect.
That said when it comes to motorbikes, I like to ride side saddle with a nice frock
That said when it comes to motorbikes, I like to ride side saddle with a nice frock
- Willopotomas
- GP Racer
- Posts: 2256
- Joined: Sat Mar 06, 2010 10:11 pm
- Location: Coventry, ENGLAND
The plot I rent is huge. There's no way I'd be able to afford to buy it. The garage alone would be worth that of a small bungalow (it's got it's own garden n' everyfin
) I did look at buying about 6 months ago, but decided against it. The repayments for a plot similar to this one were huge. A smaller, thus more affordable house just isn't practical for us.
There are advantages of renting a place. For instance, if the boiler packs up.. Not my problem.. If the roof needs replacing, again it's not my problem. We're lucky in that we can treat the place as our own and the landlord isn't breathing down our necks.

There are advantages of renting a place. For instance, if the boiler packs up.. Not my problem.. If the roof needs replacing, again it's not my problem. We're lucky in that we can treat the place as our own and the landlord isn't breathing down our necks.
Most motorcycle problems are caused by the nut that connects the handle bars to the saddle.
What Gio is getting at Dalemac is that house prices are a higher multiple of people's income now that has traditionally been the case and the implication is that if things return to normal house prices will drop and interest rates and mortgages will rise.Dalemac wrote:Gio,
The base rate is 0.5%, full rate in our situation will be around 4.6- 5% , fixed for 5 years.
If the base rate fell to 0.25%, the difference would be negligible.
We are currently throwing £4500 a year down the drain in rent alone, never mind the difference in council tax bands and the cost of heating a massive house, and the £450 water bill we got last quarter (5 in the house). I'd rather build equity then help a land lord build equity.
Besides, i would not want to be buy a house when the interest rates start increasing again! repayments would be insane!
Dale
I'm not sure that I agree about house prices but certainly the government is printing money at the moment and the inevitable consequence of that is that money becomes worth less ie inflation. Once the economy is growing again and the inflation begins to take place the bank or england will have to raise interest rates back to more normal levels - typically between 5% and 12%. Add onto that the mortgage companies bit and you're looking at mortgage rates of 7 to 15%
You might get a fixed rate mortgage now for a few years but not for the 15/20/25 years of the full life oif a mortgage. So can you cope financially if eventually the mortgage rate went up to say 10%?
And of course there is the likelyhood that when interest rates do get back to normal, lots of people will be in trouble with their mortgages and will try to sell their house pushing prices downwards. We have had far fewer forced house sales in this recession than in any previous one and the reason is simply that interest rates are so low at present.
Yeah I understand, and I could probably spend the rest of my life debating with myself about when is the perfect time to buy, let alone anyone else.lazarus wrote:What Gio is getting at Dalemac is that house prices are a higher multiple of people's income now that has traditionally been the case and the implication is that if things return to normal house prices will drop and interest rates and mortgages will rise.
I'm not sure that I agree about house prices but certainly the government is printing money at the moment and the inevitable consequence of that is that money becomes worth less ie inflation. Once the economy is growing again and the inflation begins to take place the bank or england will have to raise interest rates back to more normal levels - typically between 5% and 12%. Add onto that the mortgage companies bit and you're looking at mortgage rates of 7 to 15%
You might get a fixed rate mortgage now for a few years but not for the 15/20/25 years of the full life oif a mortgage. So can you cope financially if eventually the mortgage rate went up to say 10%?
And of course there is the likelyhood that when interest rates do get back to normal, lots of people will be in trouble with their mortgages and will try to sell their house pushing prices downwards. We have had far fewer forced house sales in this recession than in any previous one and the reason is simply that interest rates are so low at present.
If the interest rates have risen in 5 years time then we will obviously have to pay back more. In that case it makes sense to pay back as much as possible within those five years in order to pay as much off as possible in terms of capital.
If we waited for those 5 years, we would have to spend a minimum of £22500 in rent. Would the price of our house fall that much? probably not, considering we are at the bottom of the market. Let's not forget that if people did start loosing their homes as they couldn't afford their mortgage, that would push the price of rental property up too, as landlords would need to cover their mortgages.
Essentially we are buying a property which would cost us a very similar amount in mortgage repayment over the next five years to what we currently pay in rent.
At the end of the day borrowing money will always be a gamble. In my current situation I believe I have more to gain than loose. I'll come back in 5 years and give an update, lol!
- mangocrazy
- Admin
- Posts: 3944
- Joined: Thu Jul 17, 2008 3:24 pm
- Location: Sheffield, UK
Low inflation and low interest rates can be a bit of a curse.
Although higher interest rates mean you pay a bit more month by month the other side of the coin, higher inflation (provided that wages rise as well as prices) mean that the payments become more affordable and after a while the mortgage you took out that seemed huge at the time no longer seems so big.
Always a good thing to buy your own home but make sure that any loan you take you can stretch to meet repayments if interest rates increase .... then for the longer term benefits, hope that they and inflation get on and increase.
What is not good for most people (other than those downsizing or speculating on property) is increasing house prices - though most people seem ecstatic if their house increases in value. The thing is, if they are increasing and you are looking to buy somewhere bigger, the gap between the value of what you have and what you want to buy also increases.
Most of the above is the opposite to conventional wisdom .... but think about it, it makes sense.
Although higher interest rates mean you pay a bit more month by month the other side of the coin, higher inflation (provided that wages rise as well as prices) mean that the payments become more affordable and after a while the mortgage you took out that seemed huge at the time no longer seems so big.
Always a good thing to buy your own home but make sure that any loan you take you can stretch to meet repayments if interest rates increase .... then for the longer term benefits, hope that they and inflation get on and increase.
What is not good for most people (other than those downsizing or speculating on property) is increasing house prices - though most people seem ecstatic if their house increases in value. The thing is, if they are increasing and you are looking to buy somewhere bigger, the gap between the value of what you have and what you want to buy also increases.
Most of the above is the opposite to conventional wisdom .... but think about it, it makes sense.
“Scientists investigate that which already is. Engineers create that which has never been.”
-- Albert Einstein
-- Albert Einstein
Absolutely right Dalemac. Like deciding when you can afford to have kids, its one of those decisions where you do your homework but in the end have to be brave and go for it. Housebuying should never be looked on as an investment anyway - a house is a place to live not a bank account.Dalemac wrote:
Yeah I understand, and I could probably spend the rest of my life debating with myself about when is the perfect time to buy, let alone anyone else.
Just be sure that you are buying well, that the house will suit you for some years, and be realistic about the costs of upkeep.
The house is very suitable, we can see ourselves living there for at least 10 years, even if we have a child in that time. Decent size garden and spare bedrooms. Also brand new kitchen and bathrooms, although they are more bonuses than decision makers for buying the house.lazarus wrote:Absolutely right Dalemac. Like deciding when you can afford to have kids, its one of those decisions where you do your homework but in the end have to be brave and go for it. Housebuying should never be looked on as an investment anyway - a house is a place to live not a bank account.Dalemac wrote:
Yeah I understand, and I could probably spend the rest of my life debating with myself about when is the perfect time to buy, let alone anyone else.
Just be sure that you are buying well, that the house will suit you for some years, and be realistic about the costs of upkeep.
Dale
Well, crunch time is tomorrow. We are packed and ready to go, just waiting to complete in the morning and then moving in!
Thanks to all for your suggestions and thoughts.
Now we just have to move, unpack, and then make it our home!
I'll open up a tab behind the bar if i get chance over the weekend - Would do it no but don;t want to jinx anything ;)
Dale
Thanks to all for your suggestions and thoughts.
Now we just have to move, unpack, and then make it our home!
I'll open up a tab behind the bar if i get chance over the weekend - Would do it no but don;t want to jinx anything ;)
Dale
- flatlander
- Eprom Test Pilot (Stig)
- Posts: 3097
- Joined: Tue Jun 14, 2011 9:06 pm
- Location: cheshire
label the boxes with the room name they are destined for and make sure you have one with a kettle etc to make a brew and good luck 

For the avoidance of doubt and for the benefit of my wife, not everything I may say here will be absolutely true I may on ocassion embellish a little for effect.
That said when it comes to motorbikes, I like to ride side saddle with a nice frock
That said when it comes to motorbikes, I like to ride side saddle with a nice frock
We are in!
2 entire days of solid unpacking and there is still loads to go! why does it always take longer to unpack than pack?
Everything so far is good. A few modifications are needed here and there, driveway in particular, but all in all I can't complain. I cleared out the workshop, need to figure out if I can knock a wall down and lower the floor, then I will have a nice workshop and bike storage area :)
2 entire days of solid unpacking and there is still loads to go! why does it always take longer to unpack than pack?
Everything so far is good. A few modifications are needed here and there, driveway in particular, but all in all I can't complain. I cleared out the workshop, need to figure out if I can knock a wall down and lower the floor, then I will have a nice workshop and bike storage area :)