To rent or to buy a house

Hi Forum,

I have recently obtained an extension to my HSMP, and can now work in the UK till 2013.

I think now is the time to take some important decisions. The biggest one being whether I want to keep renting a house, or want to take the plunge and buy a house of my own.

I am sure other members of this forum may have sometime or the other been in the same dilemma. Can I please request members to share their views and experiences?

Also any tips on home buying in the UK would be welcome.

Looking forward to your inputs.

Regards

InUkOnHsmp wrote:Hi Forum,

I have recently obtained an extension to my HSMP, and can now work in the UK till 2013.

I think now is the time to take some important decisions. The biggest one being whether I want to keep renting a house, or want to take the plunge and buy a house of my own.

I am sure other members of this forum may have sometime or the other been in the same dilemma. Can I please request members to share their views and experiences?

Also any tips on home buying in the UK would be welcome.

Looking forward to your inputs.

Regards

Hi

Congrats on your HSMP extension. At least you can have some peace of mid!!

At the outset, let me state, I am not a Financial adviser nor a Mortgage Specialist. So following is my personal observation/advise

If you are paying rent now and working in a stable job (ie., that doesnot require you to commute long distances), I suggest to buy a house.
As you will be paying your rent as mortgage more or less. These days rents are more than monthly repayments.

If you can afford to put huge lumpsump, you get still get better mortgage deals.

You need patience and time.

That's all I can say.

Good luck

Hope this helps
Mallik

I have been looking a flat to buy for myself for over 2 weeks, I can share my experiences with you. I am just a first time buyer, i am not a financial advisor or anything else.
having your own mortgage is the best option

when u got your own mortgage u do not loose money, you invest the money into a flat or house and it would be your flat/house. the money you pay montly is in fact going in your pocket.
but if you pay rent, you loose that money.

now all the lenders are firstly looking at your deposit and how much deposit you put? if you put 25% or more deposit you get quite reasonable interest rate like 3.99% but if you put less then 25% deposit then you get 6.99% interest rate in general. that makes huge difference in your montly repayments.
there are around 500 lenders in the UK, and mortgage dealers are checking all the lenders and try to find the best one for you.

you got 2 options when u repay the mortgage back:
1) interest only repayments: you only pay the interest back, but when the terms ends like 25 years later you still have to pay the main capital back to the lender
2) interest and capital repayments: you pay the capital and interest back
some people choose option 1 other go with option 2
people go with option 1 says they make money out of it, because they fix the repayments for 2 years, at the end of the 2 years the flat value will go up (u have to take the risk of having credit crunch and house values go down) and if you remortgage it you would make the money out of it.

I would first advise you to check your credit file. You need to register on http://www.creditexpert.co.uk/ all the lenders will check your credit file before make a decision

registration is free but you should cancel your membership within 30 days if you do not want to get charged £4.99 per month.

after registration you can see your credit file, records, defaults (if there is any) and if you want to see your credit score there would be a charge which u have to pay and it is non refundable.

after seeing your credit file you might be more clear about it.

This is an interesting topic in this forum. I never thought "buying property" could be "immigration related". Hee hee...

I am not a financial adviser either however we have to think: are we sure the property will go up in the foreseeable future? Say you pay around £10k per year for renting a flat, how ever if you bought a house and if the house price went down by 5% within a year ... How much the loss is then?

haha wrote:This is an interesting topic in this forum. I never thought "buying property" could be "immigration related". Hee hee...

I am not a financial adviser either however we have to think: are we sure the property will go up in the foreseeable future? Say you pay around £10k per year for renting a flat, how ever if you bought a house and if the house price went down by 5% within a year ... How much the loss is then?

Exactly, people have short memories - I can distinctly remember two house price crashes, on one of which I lost a fortune!

Will it happen again? I dunno but I suspect it will when all the economic migrants leave, ie Poles as they are doing now, and Asian possibly too as their own countries quality of life improves, I'm sure many will elect to return especially as it gets grimmer here. What then? Then we have a surfeit of housing like in Berlin now where you can buy a very nice flat for 30k Euro...

InUkOnHsmp wrote:Hi Forum,

I have recently obtained an extension to my HSMP, and can now work in the UK till 2013.

I think now is the time to take some important decisions. The biggest one being whether I want to keep renting a house, or want to take the plunge and buy a house of my own.

I am sure other members of this forum may have sometime or the other been in the same dilemma. Can I please request members to share their views and experiences?

Also any tips on home buying in the UK would be welcome.

Looking forward to your inputs.

Regards

I can share my own experience here. I am not a financial advisor either but I have had a mortgage for the last 5 years. I came to UK on work permit in June 2004 and by december 2004 I already had a mortagage and a house. I have held a stable job with one employer since then and was lucky to get ILR in MAy this year. If I had rented a house all that long, I would be paying more or less the same as my monthly repayments. TWO points - With a mortgage, you can vary repayments anytime you get into financial difficulties but with rent, the landlord could easily evict you if you are not keeping up with payments. So for me the last 5 years have been a savings through mortgage and if i sell my house today i will recoup that saving. The only downside of everything is that I will be made redundant in January 2010! Dont know what to do with the mortgage after that?

Wanderer wrote:

haha wrote:This is an interesting topic in this forum. I never thought "buying property" could be "immigration related". Hee hee...

I am not a financial adviser either however we have to think: are we sure the property will go up in the foreseeable future? Say you pay around £10k per year for renting a flat, how ever if you bought a house and if the house price went down by 5% within a year ... How much the loss is then?

Exactly, people have short memories - I can distinctly remember two house price crashes, on one of which I lost a fortune!

Will it happen again? I dunno but I suspect it will when all the economic migrants leave, ie Poles as they are doing now, and Asian possibly too as their own countries quality of life improves, I'm sure many will elect to return especially as it gets grimmer here. What then? Then we have a surfeit of housing like in Berlin now where you can buy a very nice flat for 30k Euro...

It will happen again as soon as there are enough idiots voting for Labour again!

munisa wrote:So for me the last 5 years have been a savings through mortgage and if i sell my house today i will recoup that saving. The only downside of everything is that I will be made redundant in January 2010! Dont know what to do with the mortgage after that?

Why are u worried about what to do with the mortagage? If you sell the house now won't you get the profit? or the price of your house went down?

lboro wrote:

munisa wrote:So for me the last 5 years have been a savings through mortgage and if i sell my house today i will recoup that saving. The only downside of everything is that I will be made redundant in January 2010! Dont know what to do with the mortgage after that?

Why are u worried about what to do with the mortagage? If you sell the house now won't you get the profit? or the price of your house went down?

I think the issue is paying it with no job and the prospect of repossession..

I prefer to rent, and the rent I'm paying is about half what a mortgage would be, always has been for me and I've moved around with work a lot (hence prefer to rent).

Wanderer wrote:

lboro wrote:

munisa wrote:So for me the last 5 years have been a savings through mortgage and if i sell my house today i will recoup that saving. The only downside of everything is that I will be made redundant in January 2010! Dont know what to do with the mortgage after that?

Why are u worried about what to do with the mortagage? If you sell the house now won't you get the profit? or the price of your house went down?

I think the issue is paying it with no job and the prospect of repossession..

I prefer to rent, and the rent I'm paying is about half what a mortgage would be, always has been for me and I've moved around with work a lot (hence prefer to rent).

Mortgage also comes with added costs of compulsory building and life insurance which arent there if you rent. Plus all repair costs are down to you with a mortgage but would be land lord's responsibility if renting.

I am not a financial adviser either...

well I got the impression it is a requirement to say that before posting on this thread

Well I would say it is always a good thing to own your own property - crash or no crash. It doesn't have to be for investment purposes only - you can just enjoy living in your own house.

I'd say the bottom line is: don't overstretch yourself. If you are ready to buy a house; you have the right deposit, job is stable; you can afford something half decent etc then go ahead at your own pace. But these things also take time so either way you would need to continue maintaining your current accomodation until you have everything in order to buy. But that is key as far as I see if you can go smoothly from renting to buying then go ahead but if things are not fully in order then work towards the purchase of a house. If you buy a house as far as I can see there is no immigration matter that would adversely affect you. If things take a wrong turn jobwise then you can always rent it out or get a lodger. I'd say go ahead as soon as you are able.

My question is do you really own the property if you get a mortgage??

Who has the title deeds??

If its' a mortgaged property, you get the false sense that it's yours, when truly truly the bank owns it.

You don't pay your mortgage, the bank takes it!!!!

That's my peace!!

Biggie.

meats wrote:

Wanderer wrote:

haha wrote:This is an interesting topic in this forum. I never thought "buying property" could be "immigration related". Hee hee...

I am not a financial adviser either however we have to think: are we sure the property will go up in the foreseeable future? Say you pay around £10k per year for renting a flat, how ever if you bought a house and if the house price went down by 5% within a year ... How much the loss is then?

Exactly, people have short memories - I can distinctly remember two house price crashes, on one of which I lost a fortune!

Will it happen again? I dunno but I suspect it will when all the economic migrants leave, ie Poles as they are doing now, and Asian possibly too as their own countries quality of life improves, I'm sure many will elect to return especially as it gets grimmer here. What then? Then we have a surfeit of housing like in Berlin now where you can buy a very nice flat for 30k Euro...

It will happen again as soon as there are enough idiots voting for Labour again!

People should vote for labour as they are the most fair i beleive for migrants and who understand middle class you might be a snob voting for Torries

meats wrote:

Wanderer wrote:

haha wrote:This is an interesting topic in this forum. I never thought "buying property" could be "immigration related". Hee hee...

I am not a financial adviser either however we have to think: are we sure the property will go up in the foreseeable future? Say you pay around £10k per year for renting a flat, how ever if you bought a house and if the house price went down by 5% within a year ... How much the loss is then?

Exactly, people have short memories - I can distinctly remember two house price crashes, on one of which I lost a fortune!

Will it happen again? I dunno but I suspect it will when all the economic migrants leave, ie Poles as they are doing now, and Asian possibly too as their own countries quality of life improves, I'm sure many will elect to return especially as it gets grimmer here. What then? Then we have a surfeit of housing like in Berlin now where you can buy a very nice flat for 30k Euro...

It will happen again as soon as there are enough idiots voting for Labour again!

People should vote for labour as they are the most fair i beleive for migrants and who understand middle class you might be a snob voting for Torries

camcan wrote:

meats wrote:

Wanderer wrote:

haha wrote:This is an interesting topic in this forum. I never thought "buying property" could be "immigration related". Hee hee...

I am not a financial adviser either however we have to think: are we sure the property will go up in the foreseeable future? Say you pay around £10k per year for renting a flat, how ever if you bought a house and if the house price went down by 5% within a year ... How much the loss is then?

Exactly, people have short memories - I can distinctly remember two house price crashes, on one of which I lost a fortune!

Will it happen again? I dunno but I suspect it will when all the economic migrants leave, ie Poles as they are doing now, and Asian possibly too as their own countries quality of life improves, I'm sure many will elect to return especially as it gets grimmer here. What then? Then we have a surfeit of housing like in Berlin now where you can buy a very nice flat for 30k Euro...

It will happen again as soon as there are enough idiots voting for Labour again!

People should vote for labour as they are the most fair i beleive for migrants and who understand middle class you might be a snob voting for Torries

Now that really did make me laugh, you are seriously claiming that Labour understand the middle class?!?!?! LOL

I never vote before as I wasn't interested in it - never ever! However this discussion is interesting. What makes a good party?

haha wrote:I never vote before as I wasn't interested in it - never ever! However this discussion is interesting. What makes a good party?

Depends on what you find important.

meats wrote:

haha wrote:I never vote before as I wasn't interested in it - never ever! However this discussion is interesting. What makes a good party?

Depends on what you find important.

It seems that you care a lot on the economy, such as the house price. The recent recession is a global disaster. It would happen no matter which party is in charge. A good party can shorten receession period and make the economy recover quicker. Compare to the history, don't you think the recovering speed is quicker than ever?

haha wrote:

meats wrote:

haha wrote:I never vote before as I wasn't interested in it - never ever! However this discussion is interesting. What makes a good party?

Depends on what you find important.

It seems that you care a lot on the economy, such as the house price. The recent recession is a global disaster. It would happen no matter which party is in charge. A good party can shorten regression period and make the economy recover quicker. Compare to the history, don't you think the recovering speed is quicker than ever?

Er no, far from it. The UK is the only major economy that is still in recession and that is due to the incompetence of the current government. The same thing happened last time people were stupid enough to vote Labour too, recession. The Thatcher government inherited a mess from Labour and had to rebuild the economy, by the time Bliar took over the Tories had made the UK economy strong again and yet again Labour have ruined the economy. This will happen every time a socialist party is in power as they have no idea about how to run an economy.

meats wrote:

haha wrote:

meats wrote:

haha wrote:I never vote before as I wasn't interested in it - never ever! However this discussion is interesting. What makes a good party?

Depends on what you find important.

It seems that you care a lot on the economy, such as the house price. The recent recession is a global disaster. It would happen no matter which party is in charge. A good party can shorten regression period and make the economy recover quicker. Compare to the history, don't you think the recovering speed is quicker than ever?

Er no, far from it. The UK is the only major economy that is still in recession and that is due to the incompetence of the current government. The same thing happened last time people were stupid enough to vote Labour too, recession. The Thatcher government inherited a mess from Labour and had to rebuild the economy, by the time Bliar took over the Tories had made the UK economy strong again and yet again Labour have ruined the economy. This will happen every time a socialist party is in power as they have no idea about how to run an economy.

U don't remember the three-day week, power cuts and school milk then!

Wanderer wrote:

meats wrote:

haha wrote:

meats wrote:
Depends on what you find important.

It seems that you care a lot on the economy, such as the house price. The recent recession is a global disaster. It would happen no matter which party is in charge. A good party can shorten regression period and make the economy recover quicker. Compare to the history, don't you think the recovering speed is quicker than ever?

Er no, far from it. The UK is the only major economy that is still in recession and that is due to the incompetence of the current government. The same thing happened last time people were stupid enough to vote Labour too, recession. The Thatcher government inherited a mess from Labour and had to rebuild the economy, by the time Bliar took over the Tories had made the UK economy strong again and yet again Labour have ruined the economy. This will happen every time a socialist party is in power as they have no idea about how to run an economy.

U don't remember the three-day week, power cuts and school milk then!

Before my time, another mess that the Tories had to sort out. Just like the Winter of Discontent where Callaghan blamed the press for the strikes, job chaos etc. I'd quite like to hear Brown's excuse for the lost generation that we currently have thanks to his policies.

Well I'm not a Labourite or anythingite, in fact I've never voted but I have to say things are much better now than at anytime I can remember. Schools are wonderful now compared to the shithole I was educated in, same with hospitals. Of course we have rampant immigration and illegals, but wasn't it the Tories who kicked that off - removing exit controls....

This daft notion that you house has to be worth more and more is Thatcher's crime, selling off council houses forcing your home to be an investment.

Off course, labour sent us into two heinous wars which is shameful.

But overall I'd say Labour has done a decent job, much better than any government I can remeber going back to the early seventies. Gordon Brown is a miserable Scotsman but pound-for-pound he's the best Chancellor we've ever had - he's a bright lad. He's PM now but he pulls Darlings strings.

What eleven years under Labour now and things have gone a downhill but so has the Global economy, the 10 years under the Conservative in the 80's/90's where miserable for us Northerners....

Wanderer wrote:Well I'm not a Labourite or anythingite, in fact I've never voted but I have to say things are much better now than at anytime I can remember. Schools are wonderful now compared to the shithole I was educated in, same with hospitals. Of course we have rampant immigration and illegals, but wasn't it the Tories who kicked that off - removing exit controls....

This daft notion that you house has to be worth more and more is Thatcher's crime, selling off council houses forcing your home to be an investment.

Off course, labour sent us into two heinous wars which is shameful.

But overall I'd say Labour has done a decent job, much better than any government I can remeber going back to the early seventies. Gordon Brown is a miserable Scotsman but pound-for-pound he's the best Chancellor we've ever had - he's a bright lad. He's PM now but he pulls Darlings strings.

What eleven years under Labour now and things have gone a downhill but so has the Global economy, the 10 years under the Conservative in the 80's/90's where miserable for us Northerners....

I disagree completely about Labour, they have yet again ruined a strong economy with their abysmal fiscal policy. They are determined to the ruin the City and that is the biggest wealth generator that the UK has. The clown Brown is now talking about taxing the bankers even more to pay for climate change... http://www.timesonline.co.uk/tol/news/e ... 953222.ece

Whilst it was the Tories that got rid of the exit controls it was Labout who had uncontrolled immigration and have admitted that they deliberately had uncontrolled immigration to smear the Tories and to make them come across as dearly beloved. I think it's fair to say that that policy has drastically backfired on Labour and has led to the current popularity in the BNP. Address the immigration problem in the UK and watch the BNP disappear pretty much overnight.

The schools are now the laughing stock of the developed world. Labour have dumb downed the exams so that it makes their lack of education policy look like it's working. You now get marks for getting your name and the date correct on the exam paper for example... Pupils are now taught how to answer questions instead of taught subjects, rendering a lot of them useless in the real world. The curriculum is being narrowed down instead of broadened out and all because of the 'league tables' and teachers' pay and bonuses being linked to exam results.

I didn't see Labour try to remedy the over inflated housing market. They were in fact quite happy to let everyone know that house prices were increasing and were also happy with the extra tax that would be coming in via the stamp duty as more houses were worth more than the £125k threshold than before.

2 wars yes, of which Afghanistan is going to be our Vietnam. Coupled with the bailing out of Northern Rock which has now led to the bailing out of RBS and Lloyds and we have an economy that is in ruins. We also saw in the Pre-Budget Report the other day that Labour are deliberately trying to damage the UK economy even more by refusing to make any of the cuts that are needed NOW. I just hope that no one is stupid enough to buy their spiel about how they're going to invest more into the country when there is NO money to invest!

Thankfully this will be the end of Labour for at least a generation. Now because of their lack of financial prowess we're going to have to have drastic cuts just to keep the UK afloat. Good riddance to Labour and their attempts to turn the UK into the mother of all nanny states.

You see the police have now been given powers to search nurseries for 'brainwashed' toddlers?

Well we'll never agree on politics, news and statistics are all bent and manipulated so all I go off is my own feel-good factor and how well off we are. Personally we are (ie my family) are better off than we've ever been and I'm no high-flyer.

Compare that to the late 70's all the way to the mid-nineties under both Governments and it was mostly dire.

The recession. Well as recessions go this one is a doddle! I remember the last two, dunno under which gov cos I am largely apolitical but they were terrible, real breadline stuff.

And I do like Brown as a Chancellor, he's got the guts to climb down (witness the 10% tax thing) and as an economist he's second to none, a large part of my degree was in Economics and Statistics and I know what a juggling act it is.

Schools. Agreed with SATs and all that shite but I was referring to the actually quality of the equipment etc, I well remember sharing a book in class between three of us, and that's not me dissing the Tories, it was probably under a previous Labour government.

U forget this country is a rich country, all these deficits bale-outs etc are chump change to UK plc. NHS Spine cost 12bn. Wow! I bet one Tornado costs that. UK has just given 7bn (more than any other EU state) to emerging countries to clean up their air, is that the act of a country struggling?

We r clueless when it comes to economics on this scale, our schoolboy politics cannot grasp the issues and sheer amounts involved. They r the experts, Labour and Tory alike. They are not thick or stupid, none of them.

Equipment wise schools have improved but that would've happened regardless of who was in power and the increase in availability of the internet helped in that regards.

The sooner we stop giving away foreign aid the better, we've got a budget deficit of £178bn, which is the highest it's ever been under any government! We've got no money to give. The Chinese must still be laughing after Brown sold them a significant chunk of our gold reserves on the cheap...

Economics wise yes, they should know more than us. However it is obvious for all to see that Brown restricted Darling's pre-budget report so that there would be no cuts until 2011, conveniently after the election has taken place. Unfortunately the UK isn't in a position to put off cuts due to one party's political agenda.