to be so fed up that my house has not increased in value in TWELVE YEARS

[chocolatemixedwithdogfood]

That, really.

It's in a not very great part of Glasgow - not horrific but not posh either - but it was all we could afford at the time. We paid £165,000 for it in 2006. Then increased the mortgage by 10,000 so we could convert the attic. Thinking that within five years we'd sell it for around £200k and move somewhere a bit bigger as our family grew.

Upshot has been that its valued has remained what we paid for it at the very most - we were told that it would fetch between 150-165 maximum by an estate agent this year.

We have rented it out for the past six years as our family got bigger and we needed another bedroom. And we rent our house.

It's in good condition, lovely big garden, nicely painted, though the current tenants are not keeping it in great condition with their huge dog and it will need a massive deep clean when they leave, however they are good tenants in that they always pay on time and keep the garden nice, etc.

Just wonder if it will ever increase in value, and if we will ever be able to afford a bigger house or will be forever renting.

Yeah it's worded differently depending on what type of mortgage you have the provider ect I have a repayment mortgage and I'm allowed to pay 10% of the total mortgage off on top of my regular payments! Might be worth looking into to see if you can gain the capital that way once you have then you can look at wether a repayment mortgage or a interest only with extra payments is best for you. At the moment I'm not sure what most providers would offer you

Yanbu - I would've expected all houses to have increased in value over 12 years. But I guess we had the credit crunch/recession during that 12 year period - so in a lot of areas the house prices have stagnated. Gawd alone knows what will happen with Brexit

Interest only mortgages are/were an absolute scandal IMO - we were given the hard-sell on one when we bought our first home, back in the 90's. We refused.

I bought a flat 12 years ago on a buy to let mortgage. At the time it was £92,500 - there was a bidding war and it sold within 1 day. Loads of people wanted it - I thought I was on to a really good deal.

The area got worse and worse - good shops like spar and boots closed underneath and bargain shops and betting shops etc opened up - including a hydroponics shop (cannibis growing).

I paid £1,600 service charge every year of those 12 years had to redecorate and put in new bathrooms etc - the rent I could achieve was low and that meant not the best tenants - lots of owed rent - lots of empty periods and then I had enough and sold it.

After nearly a year for sale I finally accepted an offer of £80,000 - I put £47K down on that flat and made a loss of £30 a month every month whilst renting it and when I got my cheque from the Solicitor it was £32,000. I was beyond gutted.

If I had just put the £47K in my current account it would have done better!

So you are defo not the only one. At least you haven't actually lost (lots of) money like me.....

... and you don't want to make too much money do you - once you turn your home into a business aren't you liable for capital gains tax?

Is the rent more than the mortgage then if it's interest only? Have you been using tht difference to boost your lifestyle now? Then you have benefitted from owning the house.

Agree with others, you need to get the debt paid off. If so, you will be in a position when you own a house, so whatever you get from it will be a profit.

I feel for you but you do have a property.

We are still saving for one and are in our 40s. It is shit.

Couldn't get a deposit together when houses were cheaper and where we live is getting more and more expensive so the longer we wait for a bigger deposit, the more out of reach having a house becomes. I've even started looking at one bed properties for 4 of us !!!!

We are currently renting a 2 bed flat, and one for sale in the same block is on for £200,000.

Perhaps we should move..............

Interest only mortgages are/were an absolute scandal IMO

Agreed. Banks capitalising on people's desperate need to get on the housing ladder.

I feel for you but you do have a property.

actually the OP doesn't have a property as she owes the amount it is worth. she doesn't own any part of a property at the moment unfortunately

Interest only wasn't not necessarily a bad idea. Depends on the interest rate. What you do need though is a repayment strategy. Can you save anything which you could put towards building up a repayment fund. I'd normally say shares but they are very pricey now.

Why don't you just overpay your interest only mortgage?

Prime example of what is wrong with the housing market.

Everyone expects their house to increase in value, pulling the rung up behind you.

You would have known that an interest only mortgage was just that and you would have had to pay the capital off, especially after the global hit in 2008, you've had a fair few years of low interest rates specifically because the economy was built on asset prices.

The saying of "you can't go wrong with bricks and mortar" has much to blame.

According to the news today house prices have been going down for the last 3 months.

Since you have it I mean. I'd love to have an interest only mortgage. That way if you ever have a tough month, it's not a commitment, but you are still reducing the mortgage balance.

I would also look at viability with the changes in personal tax on rental properties as it may cost you too much to keep it.

Have you a plan of how to live without the income you've been spending - i.e. The difference between the rent and the interest?

If not you can't afford it and should get shot?

Slithy, i think you are misunderstanding interest only mortgages, you never reduce the balance with them.
Very bad idea imo, the banks should not be allowed to offer them without repayment vehicles.

Op you may eventually have to take the hit. We bought a new build back in 1995 as we thought it would be a good idea whilst we had very samll kids ( i gave birth to dc 2 the day after moving in) but after four years we had to move and we sold out the house we had paid £112000 for £107000, it was worth it for us, but galling when three years later the new owners sold it for £170000!

The thing is that your house in Glasgow was worth £165k when you bought it in 2006 but it probably dropped to £120k in 2008. Since then the market has been recovering slowly.

We're in Glasgow too and our house is only worth a wee bit more than we paid. Doesn't bother us in teh slightest though as it's been our home for 10 years, we've been paying the mortgage off and now own a larger proportion of it.

Just be glad you are not in Ireland.
I know of someone who paid £30 million for their house and it's now worth about £8 million.
Lots of people in negative equity here or put out of their homes.
But the politicians recently gave themselves an increase in pay.
And theBritish taxpayer donated money to help us in our difficulties.
Yet our politicians got an increase. 😱😱😱😰

We are in a very similar position with or first home in north west. Owned for 12 years and rented out for 5. It is still worth the same as 12 years ago and the market remains slow so would probably have to accept less if we sold. We were in a fortunate position not to need to sell it to buy our next house, so kept it in the hope market would rise. We have a repayment BTL mortgage, but in 5 years have paid off mainly interest (as per all mortgages) so I actually wish we had got a cheaper interest only mortgage. Don't think you could switch to a 100% btl mortgage even if you wanted to. We will sell within next 2 years, and doubt we will get our money back. Wouldn't mind necessarily, but live in a much more expensive part of the country now, as you do.

We are in the south west and my parents bought their house in 2006 for 250k and have just sold it for 317k so I guess the location has also played a big part in it.

Perhaps it is time to start seeing property as a home again rather than a way of making money?

As people have mentioned if your house increases in value so do the bigger houses you might wish to buy and the gap is then larger again.

100% mortgage with no repayment vehicle is not good practice at all. Interest only, no capital repayment and 12 years later same debt and a lot of payments made - renting equivalent since you owned nothing just as you would if you rented but without a huge debt/improvements cots etc. Perhaps try to pay a little over your interest only payment to start slowly reducing your debt.

Bear in mind that if you sell it now for less than you bought it, you're going to owe the bank that difference They lent you £165000 so you owe them £165000 when your mortgage term ends I'm afraid

That way if you ever have a tough month, it's not a commitment, but you are still reducing the mortgage balance.

No, that's not how an interest-only mortgage works. The balance never goes down. OP owns nothing of her house. I'm quite surprised that the lender has permitted her to let it out on a 100% mortgage - you typically need a 25% deposit for a BTL mortgage now.

I'd get some independent mortgage advice.

@RosiePosey We have a really old Interest only mortgage. If you only pay what they ask you too you don't end up paying it back. As interest rates are low we are over paying the required payment so the amount we owe goes down month by month. For us it works really well at the moment. I'd be tempted to opt for that in the ops case but really they need some good financial advice for their own situation.

Internet only mortgages have/had their place as long as you have a handle on them and a plan b. We stuck with ours because it suited our situation at the time. I do feel happier though now I can see it going down!

We're in a similar position. Co Durham mining village- a nice bit of one - they exist! Bought for about 50K in 2003 and now worth about 60K. In that time we've done some fairly pricey work - mostly to make the place properly watertight and get rid of incipient damp problems - replaced (leaky) windows and doors, replaced crumbling, flaky pebbledash with modern render, new heating system, plus some more cosmetic stuff.

Prices in the street took a big hit when a new housing estate was built about 8 years ago - EAs marketed them as investment opportunities rather than FTB homes. They're selling again now the BTL buble has burst, oddly enough!

But, this place owes us nothing. We paid off the mortgage in under 10 years, so we've had 4 years of no mortgage accruing interest (as well as no rent to pay). Even if we don't get 60K for it (we may get more - sale prices in this street seem to depend which way the wind is blowing, from 40K at auction to 80K for the ones our size) with the savings from not having a mortgage to pay for 4 years, whatever we get will make a decent deposit on our next home. It's not like our 50k would have earned any interest in a saving account!