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wierd aint it? is it due to any one thing?
given the typo.
I do like the pun.
:o :o :o
or grandmamma/grandpapa dying and leaving you an inheritance for a deposit.
...without having family to help you.
I think there is perhaps a stigma if you're older, married, kids but rent rather than own your home. Only seems to bother people here though. Doesn't seem to be an issue in other countries.
Citation needed. Trying to recall anyone who's been called out for not owning their own home due to being married/older/having kids...
Sorry, too many kik posts been read, I guess :D
- home ownership perceived as the ideal;
- specific class-based stigmatisation regarding "council houses / council estates"
- the quality of housing stock in the private rented sector, compounded by letting agency practices (one local agency charges £450 just to apply to rent a property)
^all of the above points could be expanded.
We own a house, but I consider myself reasonably privileged to be in that position. We wouldn't have been able to afford a deposit if my employer hadn't been paying relocation costs to move to Cambridgeshire at just the same time as mrs ccb and I were getting married. We wouldn't have been able to get a mortgage without the help from my employer's mortgage specialist. There was a window in the late 90s/early 00s where it was easy for people to buy a house - that window closed maybe a year or two after we moved in.
...but it was dependant on where you were prepared to live. We initially lived in a crap area and it took 7 or so years until we're now in a place we actually want to live in.
Not sure I consider myself privileged as so many mates in similar paying jobs and similar situations carried on renting because they didn't want to move somewhere shit.
til about 2007. I mean, it's still possible now (you can get a new 2-bed property in King's Lynn for around the £100K mark) but the conditions for getting a mortgage are much tougher.
I guess it's just that we've always paid less on a mortgage than we would have done on rent, and thanks to price rises (and overpaying during times of low interest rates) we've got a good chunk of equity.
certainly not in my neck of the woods
but i can imagine there being more stigma outside of cities, or at least outside of london?
Mainly because very few people do own their homes, really - you're renting from the bank more often than not.
The big argument for owning rather than renting is 'security', but you get kicked out all the same if you don't make your monthly payments.
which is security of some sort.
Get a bit wedge of cash, I mean?
I thought they claim your house and that's that, you're fucked and all the money you put in is gone up in smoke.
the property sells for more at auction that the amount you owe the bank. It's your property, so any excess of sale price over outstanding debt belongs to you.
I just thought that was part of the gamble of a mortgage, the bank taking your property off you if you defaulted and leaving you completely fucked. Capitalism and all that.
it would be very unlikely to realise as much as it would if you were a willing seller. The bank wouldn't be incentivised to try to get as much as possible for the property, just at least what you owe.
You're simply borrowing money from the bank.
At least with buying a place there is that time on the horizon where the mortgage is paid and from then on in you're swimming in mad paper each month.
"Hey, you're gonna have a grrrrrreat time when you're 70! Think of all the Mediterranean cruises you'll get to go on! Think of the bingo!!!"
70 is that far off.
it is not really though, it is the main advantage of home ownership that you have a large asset at the end of it.
It's just usually offset against a similarly large liability.
Because at the 'end of it' you are also expected to retire and will find getting work more tricky.
This leaves you in the situation where you either have to sell the family home you went to the trouble of buying or live in a weird world of cutting back on spending while technically owning a fuck load of cash.
If you live in London and you have a dream of retiring somewhere that is cheaper to buy in and also cheaper to live in, that's fine, but for everyone else, it presents a problem if you haven't also been able to get yourself a very decent pension/nest-egg together.
that you'll never see again.
But if you did get to retirement with no money the state would still have a duty to house you.
There are pensioners paying off the leaseholder costs on windows from 10 years ago in our ex-council block. These are people who are property rich in the extreme (i.e. their flats are worth 5 to 10x what they paid for them 30 years ago) but cash poor. They didn't buy their flats so they could live like paupers where they consider home, or comfortably off in some corner of the country they don't know. Had they rejected Thatcher's suggestion and stayed as Council renters they'd likely be in as good a position.
Obviously their children will benefit. I'm just saying that a house's value is a weird sort of fake thing.
...but beyond that, having paid off a mortgage = no 'rent' when you retire (and for a while before if you're lucky) = better than having to pay rent.
Because fuck relying on "...if you did get to retirement with no money the state would still have a duty to house you."
as above, I'm just pointing out that a single house isn't really a great asset. A *spare* property is the best investment you can make, but the one you're living in is fairly unimportant unless you plan to move about, and not everyone wants to.
The only downside to it is that you live in it, which makes it harder to cash in than another asset. But very few of us manage to accumulate an asset worth several hundred thousand pounds in our lifetimes, which puts it pretty high up the list of things it's desirable to have.
Obviously as you said in your example people in leasehold properties can end up with problems, but they're pretty small fry compared to the problems retired renters can face.
It's all horses for courses though, and I don't have a problem with people who like the freedom of renting. Ultimately though if you're renting then you're paying someone else's mortgage for them, so as long as house prices keep up with inflation you're paying over the odds for the freedom.
This is an a) inaccurate and b) just generally rubbish way of looking at what renting actually is.
It's a shorthand. You are paying money to someone who has had to find the money to fund the purchase of that property somewhere along the line. Obviously there are subtleties and exceptions along the line (council housing being an obvious example), but in principle this is what most renters are doing; you know it and you know it wasn't worth trying to slap me down for saying it, since you can see that wasn't my main point.
One of my colleagues (a contractor) has mortgages on a tonne of properties in Bradford which he rents out. The profit from those are what makes up for his absence of a pension, so in the case of his tenants that is exactly what they are doing.
Doesn't invalidate what I said mind, no matter how radgy you get.
other than that you disagree with something I said. There's no argument to invalidate.
In any case you've not been keeping up with your emails. As Labour Party members the pointless argument we're obliged to be having this week is whether Miliband should resign or not.
Funnily enough I was having a debate with my Tory supporting mate at lunch who was saying that `Labour are a fucking joke` because they're engaged in an internal squabble about their leader with a general election just around the corner.
I thought this was mightily impressively ignorant.
A property can have a lot of costs associated with it that a renter avoids (boiler upkeep, damp, leaky roofing, etc.) The fact is that a lot of people can get a mortgage, but it's not just a pile of cash, it's a pile of cash if you maintain it. I was really objecting to the glib "mortgage = good, renting = foolish" sort of worldview.
but I don't see anybody really putting it forward here either.
As for maintenance costs, again the renter isn't avoiding them, they're indirectly paying for them.
...something worth shitloads of money though. Wish mine had.
but then, isn't renting in some cases more expensive than owning?
In these two representative cases, you will see that this is a fallacy:
I don't think there is a stigma, more a pressure people put on themselves
Say I wanted to buy a house. I'd have to get a mortgage, right?
If I could find one that I qualified for, would the repayments, in general be cheaper than rent (on a monthly basis)?
[Just assume for the sake of the question that i could afford a deposit]
Size of deposit, price of the property, terms of mortgage, interest rates...
For me personally, my mortgage repayments have always been cheaper than what i'd pay in rent. In our last place it was crazy cheap at one point - £420 a month for a 3 bed house. But I have some mates that pay loads. It all depends.
I've been looking into it recently, with a 5% deposit the repayments on similar places look about the same as renting, but interest rates are historically low and bound to go up
I've tried looking these things up and I find banks website to be more or less incomprehensible.
Is there any good web resource you could recommend?
the Money Saving Expert mortgage calculators are a decent place to start: http://www.moneysavingexpert.com/mortgages/mortgage-rate-calculator
Knew I could depend on you
what u_a said. also the money savings expert do a good pdf guide for first time buyers http://www.moneysavingexpert.com/mortgages/mortgage-guide
if you have a 5% deposit you probably would be best looking:
-help to buy equality loan: for new builds only, the government pays 20% so you only need a 75% mortgage and 5% deposit
-help to buy guarantee: for old builds, government guarantees 20% of your loan but you still need to borrow the 95% and have 5% deposit (the guarantee just means that banks allow people with only 5% mortgages in the first place, as to them the guarantee means the house value would have to go down 25% and the buyer default for them to risk losing money)
-share to buy, mortgage on a share of a house and pay subsidised rent on the rest, good option for accessing a better place than you would be able to afford outright but restrictions based on the borough you live or work
for the mortgage/rent comparisons I've just used zoopla and compared similar places
...will also go down the more you pay off. And if things go tits up for whatever reason, you can always sell it or rent it out.
I didn't even know that first point, still got a lot to learn
With our mortgage we actually get a penalty if we pay it back earlier than the agreed term. Again, it all depends on the type of mortgage. It's so complicated.
With a repayment mortgage (i.e. not interest only), assuming the applicable interest rate stays the same, your monthly payment will probably remain the same.
It's how much of that payment is principal vs interest that will change. In the first few years, your payments will comprise overwhelmingly interest whereas in later years they will comprise far more principal (i.e. equity value).
but don't you remortgage every few years?
it would depend on whether you were releasing equity value by remortgaging.
Say you inititally borrowed £200,000 for 25-years to buy a house worth £250,000. If you wanted to remortgage after say 5 years, you would have paid off some (albeit not a huge amount of) principal as well as interest.
Upon remortgaging you could borrow £200,000 again. By doing so, you would be "releasing" an amount of equity value equal to the amount of principal you'd paid off on your first mortgage loan, if that makes sense. So you'd be borrowing £200,000 from bank 2 but owe bank 1 less than £200,000 to discharge the first mortgage.
You'd just borrow the lesser amount required to discharge the first mortgage.
if you borrow the lesser amount would you not get a better rate than originally?
but there are also fees associated with remortgaging, so there will be an upfront cost to move to a lower monthly payment amount.
As CHAIRMAN_LMAO says above, banks make it pretty complicated and difficult to compare like for like. Transparency and consistency would be bad for business and we all know that banks are pretty ruthlessly greedy organisations.
Stayed with YBS, right enough. Moved to a lower interest rate (two year fix) because the LTV is now much better than the 100% we were at when we started seven years ago (five years fixed, two years tracker). Upped the monthly payment, though so that the term would decrease. Also, it's an offset mortgage and we'd built up a savings pot which we used to reduce the balance. Upshot: The 25 year mortgage we took out seven years ago is now due to end in 11 years (rather than 18). Fuck having a private pension. Just gonna dump dollars into the offset and then hammer that outstanding balance down. Mortgage free by mid-40s. Then the slum landlording project can commence!
Even more so cos none of it is based on given out inherited cash.
slum landlord is the dream
We're aiming for something similar. Did a rear extension last year, in the middle of having two bedrooms added in the loft. After that, all savings going into the mortgage.
and booming house prices etc. People who got a 30 year mortgage 20 years ago are having a right laugh now... in fact they have probably been over paying and are having the ultimate laugh of not having a mortgage at all.
5 bed house for £750/month AND at the end of my 30 year term its ALL MINE
When I get my hands on the considerable sum of money that's coming my way, the thought of putting it all into another property seems about the most boring idea I've ever heard.
Can't see myself ever being inspired to own again.
It's a construct that doesn't actually exist unless you consciously allow it to.
just got this email from a bank
'Thank you for your recent Online Mortgage Enquiry.
Unfortunately, due to unexpected business levels we will not be able to process your enquiry and contact you as you have requested and the reference number given on your recent enquiry will no longer be valid.
Please accept our sincere apologies.'
bit of a weird facepalm of an email
successive governments, from 1979 certainly and in many ways earlier, have been pro-home ownership and policy has reflected.
but it's also because renting in this country is crap. there's obviously a massive stigma around social renting now, but even private renting is seen as an 'intermediate' form of tenure, ie something you move on from. tenancy agreements can be really restrictive (DON'T INJURE THE WALLS!) but at the same time have a massive lack of security alongside easy evictions and rent increases. the private rented sector has a growing importance in this country - with growing importance for new social tenants, and as home ownership has been declining for the first time in about 80 years - but there's been little reform to reflect this changing role.
it's also linked in to the massive devaluing of the state pension, the end of jobs-for-life, demise of unions etc, things that make long-term futures far more difficult. ultimately, you've got to spend money on housing one way or another, and by buying a place you're ultimately setting making your money work harder in the long term.
I'd probaby just rent and hammer my money into areas a little more risky but where the rewards are greater ;)
particularly if you're looking at new properties rather than preowned, where you've got a choice of either a pokey cardboard city flat probably in a bleak, poorly serviced regeneration area, or a pokey cardboard house on a bleak, poorly serviced greenfield estate. but that's down to the staggering deficiencies in our planning and development culture more than anything else.
Obsessed to the point where they keep saying "oh buy one on the Isle of Wight and we'll manage it for you while you rent it out".
Absolutely fuck off.
I think stigma is too strong a word, but the number of people I know with family and/or friends trying to push them into buying regardless of whether it's in any way suitable for them is incredible.
we almost bought somewhere last summer. Almost. But we didn't, for various reasons which I don't think my parents "get". We were going to be borrowing some money for the deposit from my boyfriend's parents and ultimately the repayments to them would have pushed our outgoings on mortgage + that to probably too much, especially when we want a good London lifestyle like we have now.
They just don't "get" why we either wouldn't move to a smaller place (we currently rent a lovely 2 bed) or move further away from London (we don't want to). It's like our reasons for currently renting are completely alien to them.
Thing is, we still have a hefty deposit, and it's grown a bit since last summer (which, to be honest, does make me question why the fuck we have savings lying about when they could really be used to buy somewhere). I keep looking at our options quite regularly but it's not something we're gonna do just yet, at least, just because we're not realistically gonna find something as nice as we have now for the same outgoings.
But I'm frankly petrified of having to rent when I'm retired. On the ladder (!) now though so hopefully that will lead to that being an unlikely prospect...
None of our generation are going to be allowed to retire.
But you can never leave."