UK economy 'skating on thin ice'

[lilelvis2000]

I am renting a flat worth 200k for £550/month
beat that

I'm of the opinion that if you can rent a reasonable place (ie: what you would intend to buy) for less that what your interest would be, you're better off renting.. But I get told off all the time. Something about putting yourself into debt to gain equity. "Nevermind the interest - you're getting £10k a month in additional equity!"

[wendigo100]

I'm of the opinion that if you can rent a reasonable place (ie: what you would intend to buy) for less that what your interest would be, you're better off renting.. But I get told off all the time. Something about putting yourself into debt to gain equity. "Nevermind the interest - you're getting £10k a month in additional equity!"

That is a good point. After 25 years your rent hasn't turned into a large asset, which you own, and which has given a better return than the majority of stocks and shares.

[OwlHoot]

I'd say that was just government sponsored spin to say the inflation rate really isn't as high as it is. (When we all know it is actually way higher)

Another stunt is to include on the typical "shopping basket", or whatever they call it, a load of goods like blueray readers/recorders which have just come on the market and are bound to decline steadily in price over the next couple of years. That way they offset the majority of goods and services that everyone knows are steadily rising in price.

[VectraMan]

I am renting a flat worth 200k for £550/month
beat that

Not quite, but I'm close to that. I reckon I'm saving at least £500 pm by renting compared to the interest I'd be paying on a mortgage for the same place. Or to look at it another way, the house would have to increase in value by £6000 per year or approx 3.5% to break even. Which it probably will, but when you look at it in those terms not having a rung on the ladder isn't as bad as a lot of people make out and there's considerable positive aspects to renting.

I find it hard to believe anybody thinks BTL is a good idea at the moment. Far too many people who aren't cut out to be real investors have bought into property thinking there's no risk. And they've forgotten the fundamental rule: buy low, sell high.

Doomed.

[Troll]

but...but...but when the crash comes, and all those homes are re-possessed leaving thousands of displaced families - won't that boost the rental market?

[Buffoon]

but...but...but when the crash comes, and all those homes are re-possessed leaving thousands of displaced families - won't that boost the rental market?

Yes there will be a demand for housing from displaced families, but when the landlord does the credit check they will find out they are a bad risk and not let to them.

[Lucifer Box]

but...but...but when the crash comes, and all those homes are re-possessed leaving thousands of displaced families - won't that boost the rental market?

Are you crazy? Haven't you heard, it's different this time. House prices will rise by at least 10% pa forever. Buy as many properties as you can now while they are still cheap. Doesn't matter if you overstretch, the capital appreciation will see you through.

[wendigo100]

Fine if you can liquify the assets without too much hardship, not much use if you can't.

Not true. There is no hurry to liquify. You can wait five or even ten years if you want. Everyone knows that properties rise in price over long term. Alternatively, you might want to stay living there, rent-free!

[Troll]

Yes there will be a demand for housing from displaced families, but when the landlord does the credit check they will find out they are a bad risk and not let to them.

I recall in the last crash, all those bright shiny new yuppie flats & houses in the Docklands were being let out via the local authority to asylum seekers.... so what we really need is more AS/immigrants

[bobhope]

Looks like the idea of the time value of money is beyond some people here!