Why don’t people understand that not everyone wants to buy a house?

[tarrantulla]

We rent a flat in London. Have a big deposit but would rather invest it across several asset classes. Prices around us in zone 1-2 are dropping.

People will often say things like “oh are you saving for a deposit” or “it’s such a waste of money to rent” when in reality, for the last few years smart people in London rent and not buy!

people don't have to understand. You money, your life, your choice.

Still a lot less than the money they would have lost renting though.

And people have been coming on MN for years with posts designed to put people off buying in an attempt to stall prices

No, of course!
You do you, as they say around here.
I have been a landlady (zone 1, 2) for 20 years, if you wanna "grease my pockets", I'm absolutely going to encourage you to rent! 😉 👍😄

But you're ignoring everyone saying they've paid their mortgage off in their 50s and never have to pay 'rent' again.

Rent if you want, noone is going to stop you. But you'll be paying rent, which will only ever increase and always have the risk that you'll be given notice to leave, for the rest of your life. So you'll need to plan your life so you can cover that long after you stop working. Being in that position is the thing that most people can't fathom.

I can just never imagine sitting waiting for something that's relatively normal to fix to be fixed when you could do it yourself. Fair enough, a hole then roof might be an ask. But watching mold grow on the walls because the guttering needs reconnecting or something or waiting for a toilet to be fixed rather than getting down to tool station and doing it yourself seems madness to me.

I get that. But renting for a year or two whilst you finish training or whatever is not the same as a lifelong renter who passed up the opportunity to buy when they could face and are now stuck renting forever.

My grandparents had the opportunity to buy the large house they were renting in the late 1970’s but choose not to because the mortgage would have been slightly higher than the rent at the time. So they rented their entire lives and we’re still paying rent when my grandmother was 90 and passed away. The house that they had the chance to buy but didn’t, recently sold for just over a million pounds. My grandmother passed away 3 years ago and had stayed living at home with no care package just help from family. The generational wealth that was missed that could have been passed down to help the next generation of her family was huge. As i said previously if you have the opportunity to buy instead of rent it’s madness to continue renting in my view.

As a long term trend your mortgage will go down and rent will always increase.

I'm in an HA property. The issue I've had re them fixing things is they're actually ok at the small things. They usually come quite quickly and do the repair, no issue. It's the big things that I couldn't afford or do myself, that are the things they take months over. Like when I had a hole in the roof or the time I needed a new boiler. My understanding of it is, that for those things they need "approval" from higher up due to the cost and this is where it gets dragged out. Also I think the contractors they use aren't great whereas I believe they have their own for the smaller things.

Regardless of that, I am very grateful for my home. My sister was a snob about SH. She could have got it. She split from her partner back in the 90s when it was much easier to get and she had 2 young DC. But she decided to private rent. I've watched her over the years go from 3 bed house, to 2 bed flat, to 1 bed and now all she can afford is a studio. She hasn't downsized through choice. It's all she can afford and even that is a stretch but she can't face an HMO and I don't blame her. I'd never say it to her but I feel she made a big mistake not going for SH when she could have got it. But I think she thought she'd meet someone and they'd buy together but that didn't happen.

That's one of the big things that's a barrier to buying. If you're single, unless you live somewhere cheap or earn very well, or have major help, you have no hope. You have to be in a couple to do it comfortably and not everyone wants or can get that.

This is true to some extent as the market goes up and down. The big question is when. It the OP is paying £2.5k a month in rent, that's £30k a year going 'poof' into the air.

If her investments are making anything near that I'd be amazed.

I'm glad I bought when I did - which was in 2006 at a time when lots of people were convinced there was about to be a housing crash. That, and some other reasonably sensible moves mean that I'm now paying 2k a month in mortgage for a house that would cost nearly twice that to rent. I can invest the difference in various asset classes and will have a large asset paid off when I retire.

Honestly I do find my mortgage a bit of a millstone but once it's paid off I'll be glad I did it I think.

I would carry on renting, many policy changes like stamp duty increases, millions coming off mortgage fixes which could see more property for sale, changes to leasehold and landlord regulations which could derail the market. Also not impossible there is a recession by Christmas. I would buy at some point but not now. Also Prime Central has seen 20% to 30% drops from the peak.

Also quality of life in central zones in London is changing, it’s little things but I think we might get the same problems as some American inner cities. Maybe take the opportunity to rent somewhere within London with a different lifestyle.

I think it depends on your timeframes, it's very difficult to time the market. As I said, I was advised against buying (in central London) in 2006 and possibly I could have paid slightly less buying 6 months after I did but it's been very good financially when looked at even over a 5 year period.

2006 is 20 years ago, we have some unique things happening right now. Not least a huge increase in stamp duty and interest rates and last month 40,000 less people working. I don’t even think it’s timing the market, it’s recognising it’s falling in the areas I am looking at and seeing if it goes further- it will.

That's totally fair enough, I'm just saying people certainly were saying the same types of things in 2006. I can remember commentators saying it would take a decade for things to recover.

I personally think you’re bonkers but we’re all entitled to our own opinions. I mean, yes, you’ve got your investment but you’re always at the mercy of the landlord. If they wanted to sell up tomorrow then you’ve got to try and find somewhere. If the boiler breaks, will they fix it quickly? I don’t like having to rely on someone else.

We paid off our mortgage age 49. So for the last 15 years have been able to save that money. Our house has increased in value by about 240k since we bought it. it is a 4 bed semi in a mediocre area.

A 1 bed flat in our area is about £800 pcm.

why on EARTH would we think renting is better than buying?

People have been saying that for many years, and not just London. There used to be a housepricecrash forum, which I last visited probably at least 8 years ago. Some on there had sold their houses, confidently expecting that prices were about to crash and they’d be able to buy again, more cheaply…😱

Doesn’t mean it won’t eventually happen though, but TBH I’m not putting money on it. A long period of price stagnation, on the other hand….

At the end of the loan the house is yours, and will hopefully over the years of the mortgage appreciate in value

renting won’t, all that will happen is you getting rent increases, and it remains someone else’s asset

Renting suits some people, other want the security of knowing they have a property that won’t be kicked out off at relatively short notice

IMO attitudes have changed somewhat in certain countries where renting used to be the norm. E.g. a Swedish friend who returned a few years ago to Stockholm, after over 20 years in different countries inc. the U.K., didn’t even think of renting - she bought a flat a few years ago and told me that prices had continued to rise afterwards.
Likewise her adult sons have both bought their own homes. One is IIRC on his 3rd, having bought, done up and sold on the previous ones.

And only yesterday, at a Gdc’s birthday party, dh and I were talking to a professional musician parent, who was saying how cheap Berlin used to be some years ago, how cheap it was to rent a place, but how property prices have now soared and are eye-wateringly expensive.

For some reason I have yet to understand it seems to be pretty much a global thing, we’ve heard the same from other (both European and non European) countries, inc. Australia.

Remember as well that the profit in selling your primary residence is tax free. One of the last remaining things that is (and no doubt won’t be for much longer).

Interest rates were 5% in 2006, they’ve gone down 1% in the last year with more cuts envisioned so I have no idea why you think there’s been a “huge increase”.

@GETTINGLIKEMYMOTHER
“For some reason I have yet to understand it seems to be pretty much a global thing, we’ve heard the same from other (both European and non European) countries, inc. Australia”

Population increase and governments not building enough homes in the right places. More and more people moving to the cities for work. More and more single person households. Same everywhere.

I would happily rent from a council or housing association forever.

renting privately - not a chance.

OP, you sound very naive. Particularly not understanding why would buy when the market is going down.

If I were you I would have a good think about this.

I can imagine nothing worse than privately renting in my old age. Particularly in London.