to not give a toss about getting on the <boak> property ladder?

[Headbanger]

Oooo, my first AIBU

The Old Man and I were brought up, like most Brits I guess, to believe that renting was the preserve of the flighty and irresponsible and ill-advised, and that the only sensible thing to do was to buy your own home.

You know where this is going (no points for originality here): we are professionals, married 10 years, hoping to start a family, but cursed with being Londoners, and of the generation that began being gently and discreetly screwed into student debt by the Government and then being savagely shafted thereafter.

We have a respectable income, but it is so eaten up by debts and the cost of London living that we are focusing all our efforts on paying the debts off, and there is little left over.

There is no hope of us ever buying our own property: our jobs are public sector and/or the arts, and we would need to save a deposit of around £40k, and get a mortgage of something like 8 times our combined income. We're from unwealthy backgrounds, and there will be no bequests or lump sums appearing on the horizon.

Of course we could leave our hometown, but kindly do not suggest this because I don't see why we bloody should: our families are Londoners for generations, we know its very stones, all our friends are here, etc.

So (get on with it woman): AIBU to ignore all this guff about home-owning being the be-all and end-all, and be quite content renting? Our monthly rent is less than a mortgage payment would be; someone else pays for the plumbing; a nice couple come and mow the lawns; if it all goes bent, or all goes better, we can up sticks in a month.

And I'm talking planning on renting long-term here - ten, fifteen years, with (hopefully) children, and all that that entails. Maybe forever, unless one of us gets that pesky half-million book deal.

Is this irresponsible? Should we eat spaghetti hoops on toast (erm, even more than currently )and go live in Zone 72 or parts of the country we know nothing about, and where our friends are hundreds of miles away, just to say 'Oh yes, we own our own home you know'?

Do any other MN'ers rent from choice? Are you happy with it? AYBU?!

Most importantly, do you think there will be a cultural change, and people will care less about that holy grail of the mortgage, and tenants will (like Germany f'rinstance) get lovely long-term leases, with security and permission to paint over the sodding magnolia paint?

I thank you.

We rent, always have done. We're in our late thirties and like the OP both in professional jobs. However, we had our first child when we were young and hadn't had time to save money/buy a house. So we had to rent, and then paying the rent/having a child meant that we still couldn't afford to save up a deposit for a mortgage.

Over 15 years later we are no further forward really, we nearly did buy a house 3 years ago but the mortgage would have cost us 200 pounds a month more than we pay in rent...however the credit crunch hit and the mortgage product we were applying for was pulled and the replacement one we were offered was even more costly.

If we had gone ahead though we would have been in neg-eq now, off our fixed rate deal and really struggling.

I don't know what will happen when we retire, we do have pensions but they won't be huge. One plan is to whack away as much cash as possible once our kids leave home and maybe buy something tiny outright.

Thecollationneedsyou - renting it out always seems like such a scary option.

What if we do not get the rent one month? How will we afford the mortgage and the rent on another property?

What if we cannot find tennants?

What if we cannot afford the repairs the tennants want?

If we did rent we would make roughly £140 month over the amount needed to pay the mortgage on intrest only.

We rent out our house in the UK whilst we are abroad for HMG.

The rent isn't used to cover the mortgage, it wouldn't anyway, and we also pay rent here. The rent we get in theory should cover the rent we pay to the MOD, but we just bank it and then use it to do things on the house, and to build up some savings, as so far we haven't needed to do anything major, but soffits and guttering are looking like they need doing soon.

I'm like the OP, we are both part time workers in public sector jobs (let's see how long they last ) with only debts from student life and no savings, no inheritance forthcoming from parents so have no choice but to rent.

It has been stressful, we have been blessed with good landlords though the last 2 flats we were in were sold. We are now in a house which is a brand new build and the landlord has them as investment properties and not likely to kick us out for a long time, and happy for us to make the place our 'home'.

Conversely, a good friend of mine has mortgaged herself to the hilt on a house that is damp, has a leaking roof, had a kitchen flood and has just been burgled. She is very fed up in her house but can't afford to move and can barely afford to keep up with the repairs.

My family were badgering me and DH (29 and 44 btw) to get a 100% mortgage years ago, thank god we didn't as we'd be screwed now, and wouldn't have the flexibility to work PT to care for DD. Even now they talk about us getting a mortgage or a part-own house but they really just don't get that we HAVE NO MONEY! We only have debts. That's what happens when you try and make a better life for yourself and pull yourself out of your working class council estate life and fund your way through university, and then have the audacity to have children .

Oh well, I am mostly comfortable in my decision, although I do worry about retirement.Not much I can do about it really though. I do have a public sector pension, however given that the public sector are clearly the root of all evil and the cause of the economic down turn (according to the media and politicians) I'll be lucky if I still have that in 30 years time. Still, I could die tomorrow, and at least I am spent time with my DD rather than working all hours when I don't want to just to pay for a house I am trapped in.

Since most renters on here would want to buy if they could afford it shouldn't we be campaigning for more shared-ownership properties to be built?

we are renting in London. to buy a similar place, a mortgage would be double the rent ( and that with a large deposit), service charge not included.
we are good tennants and live in the property for 4 years now.
if we really wanted to, we could buy, but not this size in this location.
I rather pay rent and save the money, than eat beans on toast all the time and not being able to visit family abroad so often.

'We probably could buy. But it would mean sacrificing everything; leaving our debts unpaid whilst we saved for the deposit; sinking ourselves into a vast mortgage over a very long period; probably leaving the city and friends we love; taking on debt many, many times our combined wages (assuming we'd be given a mortgage, which isn't likely - Hey Tony B, thanks for fucking up my generation, I'll buy you a drink sometime! ); and so on.'

This means you can't afford to buy.

forever, shared ownership really isn't a good solution.

The prices need to fall. But they won't because the government will keep them propped up because to burst the bubble would mean disaster for too many people who are mortgaged to the hilt, not to mention that people use housing in lieu of pension funds because those go tits up.

Shared ownership can be a total scam - have friends who can't buy their house outright as it has a clause on it so will never own their own house. Meanwhile the rent they pay to the HA goes up and up

Shared ownership is not the solution IMO...falling house prices might be but as expat rightly says it would leave a LOT of people in serious financial trouble.

Exactly, Expat.

I don't think buying in the '80ies and raking it in is necessarily a good argument for buying a home now. It doesn't make anyone more inherently savvy, we (hopefully) won't see quite the crazy price boom we have done in the last 30 yrs, meaning that young people today will not be cashing in the way our parents did. Our 2 bed Victorian terrace is £200K odd, as we had a large amount of equity we have a smallish mortgage (around £120K) that can be paid with one salary. When we bought last year we were offered crazy mortgages to buy bigger houses but shose to stay secure. This house will maintain its value and prob increase a little over the next few years as it is a popular style in a very expensive area, but it will never increase its value 10 times as in the example given.

I can understand your thinking, but are you really going to be content with the lack of security? Not just now, when there may be advantages to the flexibility of renting, but when you're 65 and maybe wanting some stability?

The only think I really disagree with in your OP is you saying you don't want to move out of your 'home town'. I think this sort of attitude holds people back. I took it for granted (as a Londoner like you) that I would move away at age 18 (which I did, for University anyway) and then move somewhere that I could afford to buy a house. I never felt an entitlement to live in a particular area. I think it's good anyway to have new influxes of people, and often it's people moving into an area who bring new energy.

However, if you are determined to live in London and can;t afford to buy, then you'll have to just live with the downsides (as well as the upsides) of renting.

I think it would be good in the long term if prices fell but I don't think this is going to happen apart from short term knee jerks. The reason for this is the simple fact that unless a lot more houses are built population is going to outstrip supply for a long time to come.

Yanbu!

YANBU at all !! we have two children and are in a very similar situation to yours. People are forever suggesting we should leave London and for DH to commute for - what - 2 hours a day - NO WAY !!

We are happily renting. It has so many benefits. We sleep well at night because we don't have a pile of debts to worry about. And no risk in case property prices fall or mortgage interest goes up.

BTW, we HAVE actually been given notice TWICE in the past 4 years and have had to find something new to rent at short notice. The first time we felt thrown into cold water but we found a lovely new place in no time. The second time we didn't panic about it and found something gorgeous again. Should we be given notice for a third time - it'll be a piece of cake!

In our experience it's advisable to rent properties that have been rented out for a long time with the purpose of earning monthly income to the landlord - rather than a house of a family who is going abroad for work or a house that the landlord can't sell because property prices are down. The minute they go up he will sell and kick you out ;-)

To people who say you shouldn't "waste" money on rent and buy a house instead, I say: I buy two big bottles of milk week after week after week... I don't buy a cow for my front yard.

The point about property is, it has, until recently, outperformed most other types of investment, especially in London.
Also, property is an asset you can borrow against and downsize from in your old age to release some cash. Useful if your pensions are likely to be rubbish (if they are generous, then it's less of an argument).

But, if these two factors are outweighed for you by the convenience and other benefits (geographical etc) of renting, then, you have your answer. Only you can decide what's most important.

Sorry, that was very boring and the sort of thing my dad would have said to me when I was 21.

I disagree darcy I think the govt are making plans to do all they can to save businesses and industry and sacrifice the housing market.They will not continue with quantative easing and interest rates should be back to historic averages within a year.(saving must become a good idea again!)I am convinced prices will fall by about a quarter by mid next year.I have never seen so many re available houses and I have 2 close friends in property who are getting rid of some of their houses at low prices.

'the way that things are going, unemployment is going to increase, average wages are going to decrease; - prices (and rents) are not going to be able to stay where they are. '

this might effect BTLers, but as long as the government continues to pay the interest on one's mortgage if they become unemployed the prices won't drop too much.

hanna1972, another thing about moving out is that commuting any distance is very expensive and likely to become more so. the person who moves out of london despite his/her good job being there (and let's face it, who is going to quit their job in this economy just to buy a house - then you wind up unemployed and unable to pay the mortgage) might quickly find themselves going under with a still-high mortgage and massive commuting costs.

Ah but they can still pay the interest regardless of the 'value'new capital gains tax rules have started to affect prices as BTL landlords try to offload houses at low prices which consequently affects all the other houses in the street.I have seen two houses like this recently and I'm sure htere will be more.

Yeah, but the folks who are made redundant and on JSA can still get their interest paid on their principal domain via Housing Benefit, no? To avoid repossession or having to sell. So the prices won't drop too badly, it goes to follow.

Of course, the BTLers who have mortgages and are made redundant won't have this advantage.

But don't most of them own flats rather than houses?

Hence, a house will probably hold its value over the long-term.

I dunno. It'll never happen for us, so we focus on other positive goals like being debt-free.

I just think lots of people will try and sell as the capital won't be getting paid.Interest rates will rise too to encourage savers and help banks.i really do think its time up for houses increasing and falls will be quick this time

See, I don't think they will sell because of the universal attitude that one will always realise a profit on homes. So the real crunch will come when the capital comes due, but only if the prices haven't continued to spike the way they have been for so long.

I think the government's paying the interest on mortgages via HB, whilst very admirable, will lull people into the sense of security that they can ride this out.

As for the argument that if loads of people get repossessed they will cause a strain on council housing, here's a newsflash: there's so little council housing now more and more people are put into private lets with HB footing the bill. In some councils, like Edinburgh, a BTL landlord can arrange with the council to take on the homeless as tenants and get their guaranteed rent as it's paid directly to them as part of the deal.

A review of renting is long over due It needs serious reform and regulation and rents should be fixed and not calculated on how much the landlord owes the bloody banks!