To think people with an average mortgage are still far better off than their renting counterparts

[Theinventoroftoasterstrudel]

I met with a friend today who was moaning about having sorted their remortgage this week and how their payments have increased by £250 a month due to interest rises. She's now paying £1000 for their 3 bed semi and I do fully appreciate how stressful knowing this remortgage was due has been for them this past year and how painful suddenly paying so much more is. I'm not in any way trying to minimise that for my friend or others with a mortgage in this position.

However, I rent and we live in a very similar property in a similar area to her which I had been paying over £1100 for for the past 2 years and a few months ago this increased to £1250. When we were told about the increase we looked to see if there was anything we could possibly find for cheaper and everything comparable was actually closer to the £1400 mark.

I feel like the news has covered the impact interest rises are having on home owners virtually every day since the mini budget last September but renter's have only had a cursory 'and rents will increase due to landlords passing on their increases' at the end of the odd story. And with zero acknowledgement that rents were already so much higher than mortgages anyway and still are. It's not like renting has suddenly become the better option; it's still utterly impossible!

Am I being unreasonable to think there needs to be more outrage and support for renters and not just those needing to remortgage.

There are lots of schemes to help homeowners, but not renters, so the wealth divide persists.

But if a tenant loses their job or becomes , the govt will pay their rent (well, most of it) for them.

Someone with a mortgage gets no help at all for 3 months (if claiming UC) (was 9 months for the old benefits). Then they can get help towards the interest on their mortgage, but only at a rate of (iirc) 2.65%, when plenty of people are paying a fair bit more than that.

The help they get is a loan, and the interest rate charged on the loan is a tad over 3%, so they end up paying more interest on the loan than they get towards the mortgage interest.

People used to get tax relief on the interest on their mortgage until Gordon Brown abolished it, so it's not a new idea.

What is really needed is a massive programme of building social housing, so that people who can't, or don't want to, buy can have affordable homes that they can't be turfed out from at the whim of landlords.

Well, we're hardly rich. We just worked hard. We are both on average paid salaries. If we can do it, a lot more can. A lot of it is decisions. We purposefully overpaid it as much as we could pre-baby and sacrificed a lot to be able to do it.

This has certainly sharpened my focus to clear my mortgage, I bought in 2018 and should be mortgage free in 5 years.

What’s the current value of your house?

@ThankmelaterOkay is it really going to make a difference if I say? Depending on where you're from you might think it's cheap as chips or very expensive! Not sure why the focus on me. My example was purely to show that it is better to buy rather than rent, in my opinion, because eventually mortgage payments stop, like it is with me, in my 30s!

I did a dummy benefit calculation. I said I was single and still had 25k to pay on my mortgage and wasn't working. No pension or savings etc. No help in UC.
I then did the same as though living in the same house same council tax same everything but renting. Over 800 a month in benefits.

Wow... that is cheap. To be fair! I probably will be sulking too if my rent was increased to £300.00 a month to £600.00- that's a massive jump,

I guess not.

If you are never going to get a mortgage now, fair enough.

@ThankmelaterOkay I did say further upthread that we'll probably get a mortgage again and upsize, but it isn't a 'must'. We live in a 3 bed and only planning to be a family of 4🙂 it will be nice in the mean time to be able to save what we would be paying on the mortgage now though!

My point exactly!

If I was renting I would currently be entitled to a small amount of UC.

What savings limit on UC? £16,000?

Sure, let mortgaged people claim UC with less than £16,000 equity and savings.

That’ll be…checks maths…almost no one.

I’m in negative equity!

@Madwife123 I'm sorry you're in this position. With big financial decisions luck plays a larger part than most people like to acknowledge. Although that is no consolation if you've done the right things and are unlucky.

Have you spoken to any debt charities about your financial position? I don't pretend to know how help to buy works but it seems like if you could find a way to stay in your house it would be much the best for you. Apologies if you have already been through all this and I'm stating the obvious.

Separately if you know that you need to sell then ask on Facebook/Freecycle for white paint and touch up scuffed areas. Any extra you can get for the house is money you won't have to pay back so worth doing.

Of course it is, I wouldn’t like it either, but with two incomes it still seems like it should be manageable.

If it's private rent, then in this day and age I think buying/having a mortgage is the better option. If it's social housing, then the renter/tenant has the best deal, and is better off than a mortgage owner.... Social housing renter gets a long term (often lifetime) tenancy, repairs on tap, cheap rent, no extortionate repairs and maintenance to fork out for, rent paid if they become unemployed or long-term sick, remedial work done, property looked after, modernization every 20 to 25 years.

In a large-ish cul de sac not far from me that used to be all council - (homes built in the mid 1940s,) about 20 out of 50 homes have been bought on the right to buy. You can tell which are the 'rented from the council' ones. They are the immaculately presented, and repaired, and painted, shiny ones, with new-ish windows and doors and new fences, new-ish rooves and kitchens and bathrooms etc. The right to buy (owned) ones have nearly all gone to shit, because the owners can't afford the repairs and maintenance. A few of them have 45 to 50 year old windows, kitchens, and bathrooms, and the rooves are falling apart, and they are riddled with damp and mildew.

YANBU. We’ve just bought and even though fixing our house (which was much more broken than surveys picked up) is backbreaking and cripplingly expensive I’m still so happy we were fortunate enough to buy somewhere.

I’d been renting for 17 years and it’s so hard. It’s not just the cost - the insecurity, not being able to make it your own, preparing for inspections, the stress when you do have to look for somewhere new, etc. My partner has owned more than he rented and has been living in my rental while we bought, he doesn’t get my anxiety about inspections and unexpected letters but he’s also never had the rug pulled out from under him or a house where it rains indoors!!