Renting or buying....again - Page 2

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Renting or buying....again - Page 2


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Old 18th August 2019, 11:50 AM
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In my opinion It all comes down to personal preference and individual circumstance but I would far rather give the income to the bank and as in my case watch my property increase in value year after year than line some private landlords pocket how ever lovely they may be. After selling my property in Chiswick in 2009 having paid off the 15yr mortgage in 1998 the profit enabled me to buy an apartment in kingston u Thames and my property here outright with enough over to enable me to live a comfortable life here in Spain. So in my opinion my 15 yrs lining the banks coffers with mortgage payments V handing that income over in rent = No Contest

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Old 18th August 2019, 12:20 PM
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I apologise if "negative equity" is not the correct term for losing money on the initial sale price, whether or not one still has a mortgage. The same is true for all of the early 2000 new builds in our area of Murcia.
At one stage we had negative equity in the traditional sense quoted, but then we cleared the small mortgage and were left with an asset which suits our needs but which could notr be sold for anything like the price on the sales contract. Add that to the sum to be retained by the Spanish govt in case we aren't up to date with our taxes and we might just get 40% of the original price paid.

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Old 18th August 2019, 12:37 PM
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Quote:
Originally Posted by Alcalaina View Post
Average rents have gone up 50% in five years.

https://elpais.com/economia/2019/08/...35_118589.html

Of course this is not across the board, and there are still places where you can rent cheaply, but it would certainly help me make my mind up if I had to decide whether to rent or buy.
Yes, good point. With a home which is bought and paid for, when one of us dies the surviving spouse will not have to worry about finding the rent (or funding increases) out of a single income. In Andalucia at least, inheritance tax between spouses on the family home is no longer a worry.

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Old 18th August 2019, 12:38 PM
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Originally Posted by Lynn R View Post
True. But if you buy a property with a mortgage over 25 years, say, at the end of that time the property is yours, albeit you have paid the bank over and above the price of the property. You can then, if you wish, sell that asset.

If you rent for 25 years at the end of that time the property will still belong to someone else and you can recoup none of the rent you have paid.

:
If you buy you need to take a chunk of money and tie it up. Nothing stops you from taking that same down payment and investing it in something else.

The problem with treating a home has an investment is most of us buy for other reasons. People buy to be near work. Or near family. Worse few people can afford to buy more than one house. That means if things go badly you're in trouble.

Worse it's hard to sell 5% of a house if you need money.

I'm not suggesting the OP do either. I actually think with what the OP has mentioned that buying a three bedroom. Knocking out a wall to merge two bedrooms might be the best option. But at the OP's age thinking of a house like an investment can end really badly.
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Old 18th August 2019, 12:41 PM
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I'm not suggesting the OP do either. I actually think with what the OP has mentioned that buying a three bedroom. Knocking out a wall to merge two bedrooms might be the best option. But at the OP's age thinking of a house like an investment can end really badly.
In terms of being able to find what they want, I agree with you. In my experience of looking at apartments it is very difficult to find a two-bedroom one where both rooms are of a good size.

However, for anyone who is concerned about the investment aspect, wouldn't changing a 3-bedroom into a 2-bedroom devalue the property immediately?

If you buy a 3 bedroom you are more likely to get two decent sized bedrooms and one small one, I would have thought.

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Old 18th August 2019, 01:43 PM
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I'm sure you're right and knocking down the wall would hurt the resale. But if it's a non loading bearing wall both knocking it down and putting it back up shouldn't be that hard.

I'm just thinking if the OP wants a studio they have two choices.

Create one

Or buy something with a large outdoor terrace and setup in good weather outdoors.

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Old 18th August 2019, 02:53 PM
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At 55 yes old we

Sold in the U.K.
Bought at a third of the price in Spain
Banked difference as contingency and living expenses
Had a small pension

Roll forward five years

Still have property
Less money in contingency but thatís normal
Pension increasing by a whopping £5 a year!

Looking forward

Aged 66

Still have house... could sell and even at half the price we bought it still have sufficient funds to buy a small house in the village or rent into our dotage! Buying a home is just that a HOME not an investment, and itís the buying for investment that created the last recession starting in the subprime market in the USA
State pension kicks in... we have the full state each
Nursing pension might be worth another £10 a year by then!

Maryís point, IMHO, about paying banks re mortgages is valid to a point. Personally
I would not move to another country, especially nearing a particular age if I required a r mortgage. However, renting in the U.K. is ridiculously expensive in fact itís more expensive than putting money into the hands of bankers and at least you have security and something to sell. My daughter rents a two bed in hove costing £1300 a month. Itís a tiny 2 bedroom flat, totalling off topic I know, but thereís pros and cons to both but I wouldnít rent anywhere until I was older and could use the money from the house to use t have a decent standard of living
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Old 18th August 2019, 02:56 PM
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Quote:
Originally Posted by Lynn R View Post
True. But if you buy a property with a mortgage over 25 years, say, at the end of that time the property is yours, albeit you have paid the bank over and above the price of the property. You can then, if you wish, sell that asset.

If you rent for 25 years at the end of that time the property will still belong to someone else and you can recoup none of the rent you have paid.

The OP doesn't plan to get a mortgage, anyway.

Good luck tomorrow, I hope the pacemaker does the trick.
That's assuming that house prices haven't dropped dramatically and inflation hasn't depreciated your asset. I guess it depends if you're in it for the long term. I lived in my UK property for almost twenty-five years.

Thanks for the kind thought Hope all is well with you too.

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Old 18th August 2019, 03:25 PM
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Quote:
Originally Posted by blondebob View Post
In my opinion It all comes down to personal preference and individual circumstance but I would far rather give the income to the bank and as in my case watch my property increase in value year after year than line some private landlords pocket how ever lovely they may be. After selling my property in Chiswick in 2009 having paid off the 15yr mortgage in 1998 the profit enabled me to buy an apartment in kingston u Thames and my property here outright with enough over to enable me to live a comfortable life here in Spain. So in my opinion my 15 yrs lining the banks coffers with mortgage payments V handing that income over in rent = No Contest
Never had a mortgage, always able to buy cash apart from having a temporary overdraft to put down a securing deposit on a Canadian property until the balance was released from my savings accounts . I bought old run down properties very cheaply and renovated as and when I had the means to do so, helped by my son who is doing the same in rural France. I knew what I was doing when I bought him a set of Black an Dekker power tools for his fifteenth birthday and made him do small repair jobs for his pocket money.
I have a horror of debt of any kind including credit card debt. Inherited from my grandmother probably. She used to send me to the village shops when I was a kid and would send me back if she had left me a halfpenny short to pay the 'debt'. The money saved from not having to pay a mortgage each month was invested in my partner's business which we sold with the other properties. I felt vaguely insecure for a short while when we first rented but soon got over it.

The first year of renting here in Spain the monthly rent was 2300 euros. By the second year it was 1500, the third year 1000 euros a month for a detached unfurnished house on a double plot with pool in an allegedly 'good' area.
The reason for this: I reckoned that if we paid the rent in six-monthly chunks, kept the house in good order and with a reduced rent agreed to do minor repairs any sensible landlord would realise we were gold star tenants. That's how I proceeded when I was a landlord. I did what it took to keep good tenants.
Our Austrian landlord, a puti club owner in Austria where he lives, had had bad experiences with previous tenants. He had bought the house over thirty years ago cash and was more concerned with having a quiet life than raking in the dosh.
People didn't believe that we were paying such a low rent in an area where 3000 euros plus monthly for long term rentals were the norm. But we did.
I'm now living in a finca, same rent, all included apart from logs for my wood burner. The parcela has orange, lemon, fig, avocado, tomatoes, aubergines, peppers, onions etc. etc. plus eggs from the eight chickens.
I appreciate that not everyone is that lucky and yes, you are one hundred per cent right, it's all down to individual preferences and circumstances.
But as I said, the urge to be a home owner seems for some reason to be stronger in the UK than in some parts of mainland Europe although it seems to be catching on.


Last edited by mrypg9; 18th August 2019 at 03:34 PM.
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  #20 (permalink)  
Old 18th August 2019, 03:32 PM
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Quote:
Originally Posted by Alcalaina View Post
Average rents have gone up 50% in five years.

https://elpais.com/economia/2019/08/...35_118589.html

Of course this is not across the board, and there are still places where you can rent cheaply, but it would certainly help me make my mind up if I had to decide whether to rent or buy.
My rent actually decreased by over 50% in two years and stayed at that level for eight years. Luck of the draw I guess.

I found sound new tenants for my landlord, they moved in the day I moved out, saved him a chunk of cash going via an agency.
He put the rent up by 1000 euros to 2000 a month.

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