To not want to move into another rented house

[narmada]

OK I will start by saying that I know I am in a fortunate position, but nevertheless I need to come on here and have a little preggo-vent.

DP and I have 1 DD, aged 2 and I am currently pregnant with DC 2. We live in the S East and currently rent a reasonably small 2 bed house with no garden and no storage to speak of.

We could afford a modest mortgage on a house that would be a bit more spacious, and would have a garden for the kids to play in.l

For the last 4 years or so, DH and I have been having a constant to-and-fro over the issue of whether to take the plunge and buy our own place or carry on renting. He favours renting, me buying. He is worried about the economy and the possibility mortgage rates will go up. He wants to wait for a better time.

Actually, I think he is probably right that now is not the very best time to buy, but I am a little past caring. I think we need to get settled and have suggested taking out a very long term (eg 10 year) fixed-rate mortgage to make things less risky. I really, really do not want to move with two small children, especially into another rented house with the prospect of having to move again in another couple of years when DH has come to terms with buying.... I have nothing against renting as such, but think it isn't ideal with kids as you are at the whim of a landlord (and let's face it, with few exceptions they are crap, at least in my experience).

I'm not interested in waiting for prices to fall so we can get a bigger and better place (his reasoning). I just want to get settled somewhere that will do, and not have to think about moving for the next few years.

AIBU and impatient?

There are two ways of looking at this. The first is to be put off because mortgage rates will go up, although you could try to guard against this a bit by taking out a fixed-rate mortgage. I think you should talk to a good mortgage advisor so that you at least have some facts to consider. (I know a good one if needed, but don't know how you can send private messages here!).
Alternatively you could consider that fact that the housing market is at a low at the moment. It may drop a bit more, but most experts consider that the worst is over. Housing prices have increased by an average of 10% over the years since the last war, and that includes recessions. So... this MIGHT be a good time to buy as you MIGHT get a decent increase in equity over say the next 5 - 10 years.
Also consider, sadly there are a lot of people in a hurry to sell, bargains are to be had. You could even look at repossesed properties. It's certainly worth making offers in the current financial climate.

p.s. I'm a landlord and I'm an exception, I'm lovely.

YANBU unless your rent is peanuts.

How much have you spent on rent in the last few years? Even if house prices fall or are static if you buy you are putting your money into something rather than giving it all to someone else.

Interest rates will rise, but IMO if you can get a mortgage you can overpay there will have to be a lot of quarter or half percent rises before you would begin to notice.

You need a decent deposit to get a good rate though.

i can see both points of view and tbh i am fed up renting too, i want to be able to decorate rooms for the kids, get sOme chickens etc but we cant afford to buy where we live...

I suspect part of your urge is nesting.... Perhaps look at how much your mortgage would go down if bought now rather than a few more years of rent lining someone elses pocket?

The other thing is, people worry about their properties losing value, but really that's only an issue if you want to sell, if you see what I mean. If you have the home you want, and are happy in it, then that's what matters really isn't it? People buy and sell property much more than they used to do in the "old days". People used to buy a house and live in it for 20+ years. I think we can safely say they all saw an increase in their equity.

fluffyone, always good to hear of a good landlord! Actually we are lucky with our current one - she is a gem - but the house itself is becoming too small. I tripped over the toddler rocking horse in the hallway for the millionth time today and it was a good job that my DD was out withe her dad because she would have picked up some choice words....

I'm with you on this one. We moved to a new area last year and have been renting for a year. We sold our house at the bottom of the market, we are now buying again. We lost out on a few housing last year, and the house we are buying isn't ideal. But I don't want to be at the whim of a landlord and I want a house I can do things too. I think the market might drop a bit, but in the end it's your home, not an investment. You are spending the money on rent anyway, so even if the value of the house goes down, you haven't lost anything. But do take into account the fact that you will need to repair the house cos it will be yours.

beatrixrotter, the point about rent is a bugbear of mine. We have spent around £50,000 on it in the last 4 years (in our current house). My OH has now suggested upping our monthly rent spend as a temporary solution so we can get somewhere bigger, and I honestly wanted to scream at him when he said that.
issysmilkbottle I hope prices come down near you so you can get somewhere soon. Is your landlord not at all flexible about decorating? Ours isn't especially, but she is nice in other ways so I have to not mind too much!
fluffyone I have made that point about taking a long-term view to my partner. But he just won't budge. We are really at an impasse!

Narmada - I can understand your reasons and actually think now IS a good time to buy. I honestly think we've hit the bottom of the market and prices will start rising again soon. Not many economists are saying there will be another big drop so your dp's argument does not hold water here.
I am a landlord (also a nice one, like fluffy!) so always on the look out for bargains to rent out and there are some very good deals to be had at the moment if you look carefully. With nothing to see you could maybe look at buying at auction or getting a repossession?
As long as you get a decent tracker mortgage or a long term fixed for security, you should be ok.
Last ditch would be a compromise - one of these where you buy 50%/rent 50%?

Not to 'see' I of course meant to 'sell'!

jackstini we (err, that would be me, more accurately) have thought about auctions and repos: it's not a nice thought to think you might capitalise on someone else's misfortune, but it is an option I suppose I am never sure though where to find listings for repossessions. I do have the occasional look at Allsops and the other major auction houses and I guess a lot of distressed sellers would be selling that way?

YANBU. Buying a house is about having a home and being able to make it nice for yourself and your family and knowing that you don't have to move unless you want to. You're not answerable to anyone and nobody comes and inspects it (god I used to hate the 3 monthly inspections when we lived in rented...). It's nothing to do with investment, you just want a family home.

I think now is as good a time to buy as any. Mortgage rates go up and down, property prices go up and down. There's never a 'right' time IMO. Just make sure you have enough to pay a decent deposit, negotiate with the seller to get the best price you can and don't overstretch yourself on the mortgage. We took a 2 year fixed rate but as you have said yourself, you can get longer-term fixed rates than that - you can fix for the entire mortgage term if you so wish (and can always re-mortgage later if you choose).

Is there some reason why your OH doesn't want to buy? I mean other than the financial reasons. Cos they don't really add up.

We knocked about 10% off the asking price for our house because the seller was divorcing and needed to pay out her ex-husband. She had also already seen another property she wanted to buy, so she was ready to move mentally and keen to sell. You don't need to go to auction to get a good deal, you just need to be a bit nosey and ask what people's position is. We told the seller of our house outright that we liked it but we couldn't afford it and that we wouldn't be able to pay the asking price (which was true). She was then honest with us about her situation and said she was open to offers.

Where I live (also SE) prices are already starting to go up so I would say get your skates on and buy now!

i have a great landlord, never bothers us but this house is far too small too.... Been here 5 years and yes like you pretty much 50k on rent! Shocking isnt it!

I'm a nice landlord too - if it was me in the same situation, I would be doing EVERYTHING in my power to be able to buy.....long term it's the safest option.

Depends, How old are you and your dp?

Rent is dead money, I'm sick of having no control and basically being a puppet on a string. If you can get a mortgage do it

I agree with your DH actually - prices are either going down or nowhere at all so I think you have time to find the right house.

Have a look at this:

www.telegraph.co.uk/property/buyingsellingandmoving/7397683/Phil-Spencer-Sell-now-bu y-later-and-cash-inon-a-dip.html

However, as a long term renter with a crappy landlord (as most of mine have been tbh) I know all about the frustrations believe me. Until there is proper legislation to support private tenants, renting will always be frustrating!

Please beware of nonsensical statements like "rent is dead money" since a mortgage in negative equity or an interest only mortgage is also dead money, and typically far more expensive over time.

If you want to be sensible, you have to do the maths and see how renting compares with buying. Where I live, there is still a 20% premium to buy (interest only funding costs) vs. renting.

You can probably rent a lovely and enormous house for less than a mortgage on a smaller place, and wait for prices to come down, because they almost certainly will not be rising in the next few years.

But overall I'd say YANBU because I think it's a normal instinct to want to have a home that truly feels like your own.

Narmada - yes checking all the auction sites is good and trawling the internet.
If a house for sale is a repossession it will usually have a notice in the window saying something like "all chattels are to be removed from the property before X date"
Best way is to get to know your local estate agents well and tell them what you are looking for. They will contact you with any bargains.
You can try property snake which tells you what has been reduced and by how much.
Also check out what people bought their houses for on sites like Zoopla. Someone who bought 10 years ago and made a bit is more likely to go for an offer than someone who bought 3 years ago and may be in negative equity.
Good luck!

No don't beware of what I said. It depends whether you want a home of your own or to possibly have to move every 6 months. Obviously as you're considering a mortgage you're in a position to buy.
What I said isn't nonsense at all

thanks everyone for the thoughtful replies.

I don't think we would ever consider an interest only mortgage, Chandellina. That seems nuts to me. You are then completely gambling on prices rising significantly. I do see the negative equity point..it's the one I find hardest to argue with.

the differential between interest-only mortgage and rental in our area is not very significant. One of the reasons I am not keen on renting again is that I am not overly impressed with what we can get for our rental money.

Anyway, it has been really interesting getting everyone's thoughts on here. Thanks!

mintyfresh is that the Phil Spencer whose property business went bust in February 2009 ? No, but not a bad article considering the usually appaling standard of journalism in that particular newspaper .