01 June 2009

To buy or not to buy

No not the BBC1 property show featuring the house-buying fitty Kristian Digby, I'm referring to an actual dilemma here.

I've been wondering lately about whether we should actually buy a flat like we've been talking about for the last few months, or whether we should just move to a nicer rented place. Having looked at some rental adverts over the weekend, I've realised that we could afford to rent a really really nice flat now for the same monthly cost (or in fact a bit less) than a mortgage would be. I'm talking swish kitchen, decked sun terrace, and in some cases even allocated parking. This is compared to buying a flat that would potentially be quite a bit smaller, quite a bit further out of town, and probably not as nice.

So now I am conflicted. On the one hand I have that very British notion that it's good to own your own place, where you can decorate it and change it how you like, and where your money is going into a long-term investment that you actually get to keep (supposedly, assuming you don't lose money and get trapped in negative equity). But on the other hand I think that on the continent, like in Germany, loads more people rent than buy, and it doesn't seem to do them any harm. And I would have more cash left over each month for holidays and toys and things, and I could get a really nice flat straight away.

Hmm, I don't know now. I might type "should I rent or buy" into Google and let it tell me what to do, that usually works.


Katie Piatt said...

Buy. Prices are lower than they have been for ages and property has always been the best investment whatever happens in the world. Short term I can see the nicer swisher flat has appeal, but in 10 years time when you've got £100,000 in equity you'll thank me!

Katie Piatt said...

*disclaimer* property prices may go down as well as up, but they probably won't go down much further! *disclaimer*

Lee Underwood said...

Rent. Think of it this way: houses have always been something to pass on. If you buy something, who will you be passing it on to? where will the money go as and when you no longer require a house? Equity is nice but unless you're going to move into a camper van when you're 65 and live lavishly on the proceeds, or you're seriously thinking to foster or adopt down the line, then live now and rent a swish pad, otherwise the proceeds of your scrimping and saving will be for naught.

jimmy said...

Not that I know much about property, but if you are in a position where renting is a nice option then perhaps go for it. Signing a lease is a much less commitment than a mortgage - however, I am very continental and come from a country where people do indeed rent their entire lives

Urban Cynic said...

On one hand renting is easier - someone comes to fix the boiler when it breaks & you can move if you end up with nightmare neighbours.

However Brighton house prices will always stay quite high cos we live in cooldom & now is the best time to buy as prices are at their lowest but will definitley rise. I'd say buy if you can get a great bargain & find somewhere gorgeous - Hanover is a good area & is nice & quiet with a good calibre of neighbour!

superlative said...

While I agree that property prices are indeed low, possibly the lowest they might be for ages, the price of borrowing is not. Unless you've got a massive deposit, mortgage rates are very high that makes the monthly repayments high.

Another option we could consider is to move to somewhere else rented for a year or two, leaving the deposit we've saved intact, and then buying when prices might have gone up a bit again but mortgages have become more affordable.