Please or to access all these features

Add post

Watch this thread

Save thread

Start a new thread

Flip thread

Hide thread

My feed

Active Unanswered threads

Getting started FAQ's

Unanswered threads Acronyms Talk guidelines

Hide shortcut buttons

Talk

Investments

Discuss investments with other users on our Investment forum. For more advice read our tips for saving for your child's future.

Flip

1 2

Original poster

Why I don't want to buy a house

43 replies

ceilingedrawness · 28/08/2018 15:05

If you're not already a homeowner then I’m sure we can add getting onto the property ladder as one of the many worries that keep you awake on a Tuesday night.

From the media and my friends, I'm constantly being told that I need to save to buy a house, that investing in property is a sound investment and will help set me up financially for my retirement. Property prices have increased steadily for decades and will continue to do so, weathering the financial crises. I can see her point of view from where she is standing because she is part of a generation where the advice for a good life was extremely different. Studying hard, going to university and finding a steady job was sure to lead to a happy, financially secure life. Buying a house and selling it for a profit was seen as part of the journey to achieve financial success, it was seen as an asset that you could make liquid again relatively easily and use as a pension pot.

But, is a property really that sound an investment? It’s true that property prices have risen by phenomenal amounts over the decades, in the 1980s the average house price was £39,500 and less than 40 years later, the average house in the UK is now bought for £227,000. At first glance, houses bought in the 80s have seen a 467% increase, one could imagine those homeowners to be pretty pleased with their investment and they are probably looking forward to a stress-free retirement. However, once inflation has been taken into account, those returns on their property investment have actually been completely wiped out.

OP posts:

Original poster

ceilingedrawness · 28/08/2018 15:06

Would love to know what everyone's take is on buying a house? Do you want to? Are you thinking of other ways to grow your wealth? Are you happy renting for the rest of your life?

Personally, until I understand investing and become financially literate, I'm going to stay away from saving for a house.

OP posts:

OakElmAsh · 28/08/2018 15:14

Its not all about making a profit though - its about having your own home that you can decorate however you like, make any changes (within planning regs of course) that you like, and that you can be 100% sure that you can stay there and a landlord won't end your tenancy
So its a lot about stability too

Original poster

ceilingedrawness · 28/08/2018 15:17

That's a really good point, I imagine once I feel more settled that I'll probably be more inclined to want my own place to call my own as well.

Especially, when you have kids, you want to know that a landlord won't end your tenancy, like you said!

OP posts:

Oblomov18 · 28/08/2018 15:30

British love owning a home, Americans and Europeans aren't as into it as we are.

You struggle all your working life to make the payments. Then, you pay off your mortgage, and then because you thus have enough money, you then need to sell it to pay for your very costly nursing home fees, leaving little money left for your kids? So what's the point?

Plus, it's really a loan, a decreasing one. So, you're pay less eventually.

You take out a mortgage and pay say £1000 a month. But if you rented you'd have to pay say £1500 or £1750 for a similar property.

BlaaBlaaBlaa · 28/08/2018 15:39

For us it's about stability. I have friends who rent and they are constantly having to move. They also pay a similar amount in rent as we do for a mortgage but have very little control over the property.
It's also ( hopefully) going to be an inheritance for our son

Bestseller · 28/08/2018 15:41

I've never considered it an investment, just better value, long term, than spending out on rent every month and having nothing to show for it.

I completely understand why a lot of young people (and not so young people) are renting now but a major concern of mine for those people is what happens after retirement?

I know pensioners have always rented but historically it's been in social housing. If you rent somewhere "nice" how are you going to maintain that in old age? At least when you buy, the mortgage payments reduce in real terms each year and eventually you get to live "rent free".

80sMum · 28/08/2018 15:47

For me and DH, it was wanting a place that we could call our own and could decorate and/or refurbish how we liked, have whatever pets we wanted etc.

There was also the thought that prices were rising and if we didn't get on board quickly we might miss the boat and then not be able to afford it.

This was over 40 years ago, when prices were much lower relative to income but interest rates were very high.

GreenTulips · 28/08/2018 15:52

We own a 4 bed as we have kids, as they leave home we will downsize and reap the rewards. This freeing up the equity for a few jollies.

Our payments reduce as the mortgage gets smaller (although we stick to higher payments)

We can improve or not as we like

No risk of 'a months notice'

Can stay local to schools something my friends struggle with

Ignoramusgiganticus · 28/08/2018 15:53

Once you've paid for it then there is no more rent - ever.
When you are young 25 or 30 years seems like a very long time to be paying a mortgage. In reality the years go by in a flash. Now at 50, we won't ever have to pay for housing again and we have spare money each month. Those renting will always have to pay rent.
And in a lot of cases the mortgage is less than rent anyway.

so to me it's a no brainer - if you can get the deposit together, that's the big problem.

BigBlueBubble · 28/08/2018 15:57

I like being a homeowner. It isn’t an investment - it’s our home. We can’t be kicked out because the landlord wants to sell. We aren’t forced to give anyone access for inspections. If we need maintenance we organise it ourselves and don’t have to phone a landlord who will probably do bugger all. Nobody can raise our monthly payments on a whim. We can decorate as we see fit and don’t have to live with the landlord’s hideous decor choices. We can plant stuff in the garden. We can stay here for as long as we want. And the mortgage costs less than renting.

ThroughThickAndThin01 · 28/08/2018 15:59

I would be worried sick about having to find rent in retirement if I didn’t own my home by then.

Accountant222 · 28/08/2018 16:00

We bought the first in the late seventies, and moved 3 times since, upgrading each time, we have been mortgage free 15 years, if we hadn't bought we would still be paying rent.

Elllicam · 28/08/2018 16:01

I agree with the above posters, information us it’s less about investment and more to do with security and the eventual payoff of no mortgage. We should be mortgage free by 50, even if we need nursing home care it shouldn’t be for a while after that . The security is important though, we have agency over our own choices in our home, we can have pets, decorate, extend and not have to ask permission. Any investment we make in our home adds value. I admit though there are downsides like being unable to quickly move to get more space for kids etc and the cost of buying and selling is eye watering at times. In the long run buying was definitely better for us as a family.

Winchester89 · 28/08/2018 16:03

It's security for me. I have kids and the thought of a landlord wanting to sell and being kicked out at any time would stress me out no end.
I also watched my cousins ( aged 18-25 at the time) have to leave the home they had grown up in as it was rented by their mum and she died - it was heartbreaking.

Also - where I live a mortgage is typically less than rent anyway so IF you can get a deposit to me it makes sense. Then after 25 or however many years - no more payments - otherwise you'd have to pay rent until you die and might not be so affordable in retirement.

Original poster

ceilingedrawness · 28/08/2018 16:03

haha yes I definitely don't have the wisdom of age on my side, I really can't imagine paying something for 30-40 years but I think I need to change my outlook on life, start thinking of life as more of a marathon as opposed to a sprint.

OP posts:

HollowTalk · 28/08/2018 16:06

I would worry about retiring and having to pay rent. The whole point (to me) of a mortgage is that at some point in the future you won't have to pay rent. There is no security like that.

nononsene · 28/08/2018 16:11

If you're paying rent then you're essentially paying someone else's mortgage rather than your own

generally paying more for an equivalent property then with a mortgage as landlords have to pay a mortgage and want to make a profit and cover repairs etc

-have no security -have no right to make changes -have to pay rent for the rest of your life whereas a mortgage will usually be paid off by the time you retire. -have no asset at the end of it

It's a no brainer for me

tootstastic · 28/08/2018 16:18

Paying a mortgage on my home is approx. 30% cheaper than renting the equivalent would be. Also, you need to consider how you will pay rent once you've retired. Without an amazing private pension, you'd need the government to pay it for you. If you can possibly get the deposit together to buy a house, it makes sense to do so.

GuntyMcGee · 28/08/2018 16:20

Right now, stuck here in a tiny two bed next to shitty new neighbours.... Part of me wishes I were a tenant so I could move.

Unfortunately we are mortgaged. We bought ours in 2006 at the height of prices and the following year the market crashed. 12 years later and we break even on what we paid... no extra equity, so no bloody investment for us and we're trapped next door to people who make horrendous noise and seem to think lighting a barbecue using petrol is a great idea...

Westworldmaeve · 28/08/2018 16:35

Buying and paying off a house means that I don't have to rent in retirement and will be financially much better off. I also like to be the one who decides what happens to my home. I can paint it or rebuild the kitchen or whatever.

DH once showed me an infographic that if renting people invest the money that they save by renting instead of buying, they were not much worse off in the long run. It was U.S. based though.

HollowTalk · 28/08/2018 17:27

Gunty, can you not move to another house? It's awful to live with neighbours like that - is there no way out?

Original poster

ceilingedrawness · 28/08/2018 23:32

Westworldmaeve - that's interesting, I would love to see something like that, thanks for sharing!

OP posts:

HandOff · 28/08/2018 23:34

When you are paying rent, you are paying off someone else's mortgage. Why not pay off you own?

Bluntness100 · 28/08/2018 23:49

I can't imagine wanting to spend my pension and retirement renting. I'd rather own my own home, with no more housing costs past maintenance and not to be elderly and forced to move because my landlord is selling up or because rents in my area have escalated to be unaffordable to me over the years, to not to have to pay hundreds or even thousands every single month just for the privilege of living there.

As a home owner I know full well uou don't spend hundreds/thousands every month maintaining an owned home for your whole adult life. No house needs that much maintenance.

My daughter is 21.shes already saving a large percentage of her salary every month to enable her to have a deposit and buy. Good for her. I hope she achieves it. Retirement may be a long way off. But as a pp said, the years go by in a flash.

You don't have to buy, but one day you will look back and regret it as you sit in your rented accommodation, paying your pension to your landlord, as your home owning friends, celebrate having paid off the mortgage.

Sarahandduck18 · 29/08/2018 07:35

Mortgages are better than rent because you only pay it for 25 years rather than 60 years.

Flip

1 2

Swipe left for the next trending thread