Would you buy if you were me?

[Psychgrad]

Some back story… dh and I are mid thirties, first time buyers and plan to have a baby next year.
We both have ties to London (non negotiable) for at least 4 years due to our jobs.

We have a lovely flat in a nice part of zone 2 that we rent now but the lease is up in February and rent will increase by ALOT by then (they’ve told us). Anyway, we have dogs and want a larger property with garden for more space when baby comes etc.

We recently decided to buy, have our AIP etc, our thinking was that it would be better than renting in the long run and even with inflation rising, buying is cheaper than renting.

my dilemma is.. I’m not sure I want to be in london for much longer, as I said we are tied here for a least 4 years but I’m just not excited about property here, we seem to be only able to afford small, cramped spaces on busy roads, in crap areas, even further out in zone 6 we could definitely get more for our money but then it’s the long commute and the costs of transport you have to factor in. We’ve also thought about moving out to essex or kent and commuting in but I’m thinking would it not be best to buy within london in the hope of making a profit in a few years? I realise it might not work out like that due to the current market but wouldn’t the properties in london do better than kent or essex?

We’re both from Dublin and want to move to the outskirts of there, close to the sea when we are finished with London. I feel impatient but I know it’s likely better to buy now as house prices are coming down. We viewed a property yesterday that was 400k in feb and now it’s reduced to 325k. It was also on the Elizabeth line so I can only imagine the value going back up in time?

So my question is, would you buy or just keep renting for the remaining few years? I say we’re here for 4 years but when you factor in time spent looking for properties/ selling with baby in tow we’re likely looking at 5 or 6 more years here. If we don’t buy now and wait four years, we’d be in our 40’s by the time we get around to buying our first home.

How do you get excited about buying properties in areas you don’t particularly like in a city you are becoming tired of?

Definitely buy. Something on the Elizabeth line sounds ideal.

We just want to make a profit if in anyway possible but I realise breaking even isn’t the worse thing either. It would be great to make a profit in a few years and buy somewhere lovely, with great schools etc. but that’s everyone’s dream isn’t it?

You won't be in the property long enough to make a profit. Especially in this economic climate.

But no reason you can't overpay & build equity

I normally always say "buy". But if you are 100% certain you will leave the UK in four years, I don't know that you would recoup the costs of buying, selling, fixing up and maintaining a property. You might just end up breaking even yourselves and giving money to estate agents and the revenue.

On the other hand the rental market is painful too because of all the people in the same position as you. And as someone said above, plans can change and you might be here longer than you expect, in which case buying is more stable.

I've just had a viewing cancelled on me this morning after spending ages cleaning and tidying if you want to come round!
We're on Elizabeth line, and national rail, 6 miles from M25, 2 bed house with off road parking, big garage, garden and huge ancient woodland right behind the house for the dogs, nice quiet road, friendly neighbours, supermarket 2 miles away, and school round the corner.

Sutton is a good area - on outskirts and good schools if you do stay here longer, can get into London very easily and out to surrey etc, can get more space for your money and less grim than croydon. Flats can be harder to sell so get a little house if you can.

Even if you don't make a profit, you'll have built up some equity if you buy over renting and stamp duty will be cheap if you're both first time buyers. You could also rent your place here out when you move home until you sell it.

I think you’ve got to weigh up how much interest is the deposit gaining for you in which ever account you’ve got in there and can you keep adding to it ? And the 96,000 that you’re gonna spend in rent that you’re gonna have nothing to show for.

I do not believe you’re going to get 96 grand in tax, free interest over the next four years.

And therefore forget the capital gains and just focus on having a nice life, not having to move again because that costs money. I’ve spent two grand every time I’ve moved from Rental to Rental.

I completely disagree with that statement. It’s very unusual to not make any kind of a profit in Property. Might not be much/what you want, but you’ll make something, youll cover your costs.

I'm pretty sure the average London flat hasn't seen much change in price since 2016. In real terms that's obviously a decline. With higher interest rates & inflation I can't see things turning around in a short period. After all the flat the op is interested in has been reduced by 75k!!!

The fact that it was even advertised at 75,000 more though suggests at some point it was worth more than 75,000 in its current asking price otherwise they wouldn’t have popped that number out of thin air. Appreciate that the increases aren’t gonna be anything like what we’ve seen in the last few years. Be unusual fruit not to be 5% per year.

Be unusual fruit not to be 5% per year.

In real terms?

I do believe property will still increase in value long term but the op doesn't have a long term view. I think it's foolish to assume it will be a given in this economic climate 🤷🏻‍♀️

Hopefully op won’t need to buy SDLt and so will mainly be paying the conveyancing and survey fees which can be covered in time

so it will come down to paying her mortgage or someone else’s - and I’d usually go for the former

*pay SDLt

it will come down to paying her mortgage or someone else’s - and I’d usually go for the former
It's this, really, for me. Sure, there are some circumstances where renting makes more sense than buying, but the amount of rent payable in London over a period of four years+ is going to add up and you may as well have something to show for it - not necessarily in terms of prices going up and making some stellar profit, but just in the sense of hanging on to at least some of the money you'd be paying anyway to live somewhere over that time.

Yes I would buy in London if you're staying for 4 more years, but find a cheap area and make it as saleable as possible. I'd go for a 2 bed house over a flat for example.

Alternatively can you buy a BTL in Dublin to get a foot in the market there?

We left London 5 years ago and our options were Dublin or Melbourne. We decided on Melbourne for now but know in the future we'll likely move to Dublin and we're thinking seriously about a BTL there.

@Psychgrad

Near Reading in a small town. Several towns nearby, but it's just not the same as living in London. The last place I lived was Putney, a lovely walk along the river to the high street, loads of busses straight into the centre. Night busses then too (not sure now).

Theres just a buzz in London that I miss & I miss being able to go to concerts & not have to factor in getting back here. I miss just going to things that are in, without factoring in either a hotel room or a really late night & hassle getting home (especially if I want to have a couple of drinks). Teenager went to one of the BST concerts, came straight home after, I picked up from Reading station & it was1:30 when we got home.

trains are only 40 mins/hour but then add on getting to the station, getting anywhere from Waterloo/Paddington. It all adds up & the expense. It rarely feels worth it to go.

can you give me an idea of where the houses are at that price?trouble is, I'd really like a nice house in Putney (well, I think so, I'd have to go & see what it's like now!!)

@fruitandbarley can you post a link please?

@FFSwhatisthis selhurst was the house reduced by 75k and we also saw some
nice maisonettes around Hornchurch.

@Fooksticks Melbourne would be a dream, we left Toronto (a twin city to Melbourne apparently) and I ask myself every day why the hell we left 😅

I've sent it in PM

I’m in a similar position. But I’m older - 46. Finally can afford to buy on my own in the South East, Zone 6. Love it here but 300k (absolute max budget, buying on my own) buys me a 2bed flat. If I got back to N Wales where I grew up I could get a 4 bed detached! Realistically I’d buy smaller than that and save myself the money. Can’t move to N Wales for 4yrs until DD has finished school. Rent for 2bed flat is £1295, so buying would be more. I need a garden though for the dog, since I rented the flat in February (house before then) he’s going blind, and I really do need a garden. Got an appointment with a mortgage broker this week. Is it crazy to buy? I don’t think it will gain in value but I feel like I’ve got to start my mortgage and not wait until I’m 50! Scary times

No one buys their forever house as their first property. Most people have to make compromises. Just think of it as a stepping stone. I would buy sooner rather than later.

I would definitely buy and buy freehold if you can. Buy near the m25 but with good links to central (Elizabeth or Piccadilly are a good bet) and you’ll at the very least retain your money but should benefit from capital growth. Renting is just throwing money away.

We moved out to the countryside but did not like it and have moved back to the london burbs. I wish I had moved sooner. Being a mum in the countryside was very lonely. I’m so happy. Things stay open past 7pm!

You don’t know what the future holds and whether you will move in four years, more or less. So you may as well be investing in something. Just make sure you consider how you would afford higher interest rates and what the contingency would be if you stopped being about to afford the mortgage.

best of luck.

Let me rephrase my rather ignorant comment…Renting isnt ‘throwing money away’. Renting is an excellent optional for lots of people who want flexibility or a necessity for those who can’t get a mortgage. In exchange for rent you get a home! But you don’t benefit from the long term growth in property prices. Which is normally most steady in london.

Definitely buy
I am not a forecaster but property does increase in value over time so I imagine you may end up with some profit .. and can't imagine you'd be worse off than renting and leaving your deposit in a savings account.

With a baby you also have the certainty of not being kicked out of your flat when the landlord decides to sell etc.

I would go as far out as you feel comfortable to get the best balance of lifestyle and house. If you're on mat leave I'm assuming you'll have a year without commuting anyway.

The other thing is once you have dc, home has a different meaning and you might find yourself not wanting to uproot back to Dublin. There are some lovely commuter areas outside london where life can be really good and nice sense of community with young families etc.