Reply to: How much is a reasonable mortgage?

[scooterscot]

August report for Edinburgh. Sales volume like everywhere else has shrunk for starter properties however top end of the market is still doing well. Generally values are holding if not increasing.

[BrilloPad]

dam tooting it is

Are prices still rising in Tooting?

[scooterscot]

that's alright then

dam tooting it is

[Ruprect]

England's market

In Edinburger prices are still rising.

that's alright then

[scooterscot]

The UK housing market is toast. We're already circa 10% down YOY

England's market

In Edinburger prices are still rising.

[Turion]

A good contract rate for me would 500 a day but could be as low as 250.

Why would you work for 250 when you can get 500 That's a massive difference and it makes as little sense as your massive mortgage logic.

[moorfield]

I have just taken out a mortgage of £380k.

You won't be retiring any time soon then eh
BP?

My offset was down to £130k but now rising rapidly due to the building works at Moorfield Towers.

[BrilloPad]

I have just taken out a mortgage of £380k.

[Lazylobster]

Stay out, rent for a couple more years. Stash that cash and job done.

The UK housing market is toast. We're already circa 10% down YOY. Lots of evidence to suggest this is going to get a lot, lot worse.

So, sit back, relax, take it easy.

For a somewhat bias read, try http://www.housepricecrash.co.uk a lot of people on this site get it right more often than the so called economists.

I sold the last of my property in Jan 07. Pretty much spot on. The housing market is usually like an oil tanker, takes time to slow down and go into reverse. The speed at which this market is correcting is somewhat scary.

Pay the rent, at the end of the day, you don't want to buy into a depreciating asset.

LL

[GreenerGrass]

There are only 2 of you - if I was in your shoes I would :

1) Keep saving. Wait a few years for property prices to fall 40%
2) The just buy a regular house to live in. You will be able to get plenty of house for a price of under £300k
3) At the same time buy an investment property with the amount of cash/mortgage that you would have otherwise spent on a more expensive house for yourself.
4) Wait a few years for prices to rise.
5) Get married, have some kids (or vice versa).
6) Upgrade to bigger house, which you will need by then.

A mortgage of £300k is a horrendous burden to put you and your girlfriend under. I have mates with mortgages of £220k and they worry day and night.

I pretty much agree with the above (except 5). Wait a couple of years for things to bottom out - although I reckon it'll be closer to a 25% drop in total - and only buy something you could still afford the payments on if you had to go back to permie.

If you hate being a landlord you can always sell any investment property after a few years and use the equity to either pay down your mortgage or buy something bigger if required.
In tax-avoidance terms the "just one big house for yourself" approach would mean zero capital gains tax in the future, but since they reduced CGT it's less of an issue.

[Money Money Money]

What the hells the point of buying a house now???

Why not wait till house prices hit rock bottom?

Rent your dream house in the mean time!

[blacjac]

What's wrong with getting a flexible mortgage, and then paying it off as quickly as possible to minimise the interest paid? Best of both worlds.

Now that is a good idea.

[chicane]

So you'd rather pay tripple the amount over something like 20 - 30 years because 6 years is too long?

What's wrong with getting a flexible mortgage, and then paying it off as quickly as possible to minimise the interest paid? Best of both worlds.

[blacjac]

Yeah, I don't think the amount of time to save up would be reasonable. Could maybe save up for a cheaper interim place but even then I still have to live somewhere when saving and the rent is going to be roughyl the same as the interest on somewhere.

It does sound a nice idea but the timespan is just too long.

I'd also hope to gain from house price rises (ha! obv not right now) and the debt being worn down by inflation.

So you'd rather pay tripple the amount over something like 20 - 30 years because 6 years is too long?

[chicane]

Dang right that's manageable -where are you getting such a rate?

Funnily enough, my first mortgage was around 2k a tyear.
But then, the house cost just under 40 grand.