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Renting or buying....again - Page 3


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  #21 (permalink)  
Old 18th August 2019, 03:39 PM
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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 atching on.
Being able to buy a property with cash anywhere in the world is really the exception to the rule. I have no idea about renting in the rest of the world but in the U.K. it needs better legislation etc. Families can rarely get rental terms of longer than 6 Months, how can a young family lay down any roots not knowing if their contract will be terminated. Post six months many landlords then do a rolling monthly contract. Landlords wonít allow people to decorate their homes or put up pictures etc. Both my daughters have rented in the south east since they left home. Both have suffered at the hands of bad landlords, lack of repairs, stupid letting agents, no real recourse apart from hefty legal costs.

Thatís why people buy, they want control and the ability to put down roots. Both my daughters earn very good money, but when you are paying out £1300+ a month itís Impossible to save 40/50kÄ deposits for a mortgage. My daughters only hope of buying a home and being settled is to wait until we snuff it
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Old 18th August 2019, 03:55 PM
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Being able to buy a property with cash anywhere in the world is really the exception to the rule. I have no idea about renting in the rest of the world but in the U.K. it needs better legislation etc. Families can rarely get rental terms of longer than 6 Months, how can a young family lay down any roots not knowing if their contract will be terminated. Post six months many landlords then do a rolling monthly contract. Landlords won’t allow people to decorate their homes or put up pictures etc. Both my daughters have rented in the south east since they left home. Both have suffered at the hands of bad landlords, lack of repairs, stupid letting agents, no real recourse apart from hefty legal costs.

That’s why people buy, they want control and the ability to put down roots. Both my daughters earn very good money, but when you are paying out £1300+ a month it’s Impossible to save 40/50k€ deposits for a mortgage. My daughters only hope of buying a home and being settled is to wait until we snuff it
Spot on. Yes it really is a big problem for first time buyers, especially in the area you mention which is out of reach for the majority of first time buyers. Cash buyers are in the minority and in most cases are either as you inferred have inherited from a family bereavement. If you are earning less than 100k + per annum it would be virtually impossible to save for a deposit and pay the high rents and living costs in S.East and many other areas of the U.K.
As I had planned to live here full time I was toying with the idea of renting my Apartment in Kingston u Thames out as it ideal for the University which has many overseas students whose parents have deep pockets. Decided against becoming a landlord but even back 2 yrs ago similar in my area were renting for £2,800 a month upwards. Its all madness but people are paying it. In my building I guestimate by chatting to the security people that the split is near 50-50 in owner/renters .......renters seem to be alot younger than the ones who own.


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Old 20th August 2019, 05:12 PM
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Being able to buy a property with cash anywhere in the world is really the exception to the rule. I have no idea about renting in the rest of the world but in the U.K. it needs better legislation etc. Families can rarely get rental terms of longer than 6 Months, how can a young family lay down any roots not knowing if their contract will be terminated. Post six months many landlords then do a rolling monthly contract. Landlords won’t allow people to decorate their homes or put up pictures etc. Both my daughters have rented in the south east since they left home. Both have suffered at the hands of bad landlords, lack of repairs, stupid letting agents, no real recourse apart from hefty legal costs.

That’s why people buy, they want control and the ability to put down roots. Both my daughters earn very good money, but when you are paying out £1300+ a month it’s Impossible to save 40/50k€ deposits for a mortgage. My daughters only hope of buying a home and being settled is to wait until we snuff it
I got involved in buying old properties and doing them up for sale nearly forty years ago!!! My cottage, detached, flint, built in 1760 or thereabouts, cost me £5000 in 1978.. Way back then the local authorities gave you a grant for refurbishing old properties. You could rent them but couldn't sell for five years. I never paid more than £10k for a property apart from the one in Canada and that was about £50k sterling. I got a tenant as soon as I bought it as the property, in an old woollen mill, came with a guest apartment owners could apply to use.

I know this was long ago and things have changed. I didn't make £millions out of the five properties I bought and sold, just a reasonable profit. I know it's a lot harder nowadays for young people to get on the property ladder.

I'm not au fait with current UK rental laws but it seems there is an urgent need for secure long-term contracts with rent controls.
That won't come from Johnson.

My current contract here in Spain is for five years renewable. My previous one lasted ten years. I can't be the only lucky person in Spain...

Re your last comment: my two grandsons have been able to buy properties thanks to inheritances from my late daughter-in-law.
I think we'd all prefer to have Linda back...


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Old 20th August 2019, 05:33 PM
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I got involved in buying old properties and doing them up for sale nearly forty years ago!!! My cottage, detached, flint, built in 1760 or thereabouts, cost me £5000 in 1978.. Way back then the local authorities gave you a grant for refurbishing old properties. You could rent them but couldn't sell for five years. I never paid more than £10k for a property apart from the one in Canada and that was about £50k sterling. I got a tenant as soon as I bought it as the property, in an old woollen mill, came with a guest apartment owners could apply to use.

I know this was long ago and things have changed. I didn't make £millions out of the five properties I bought and sold, just a reasonable profit. I know it's a lot harder nowadays for young people to get on the property ladder.

I'm not au fait with current UK rental laws but it seems there is an urgent need for secure long-term contracts with rent controls.
That won't come from Johnson.

My current contract here in Spain is for five years renewable. My previous one lasted ten years. I can't be the only lucky person in Spain...

Re your last comment: my two grandsons have been able to buy properties thanks to inheritances from my late daughter-in-law.
I think we'd all prefer to have Linda back...
I donít think anyone, especially me said you made a lot of money, but to have the funds to purchase a property outright even years ago was the exception. My own parents, back in the early 60s desperately tried to buy but they were not the right class to get loans or mortgages and certainly could not buy a car outright let alone a house.

Re the last comment. I would hope my children would prefer to have me back but the cold starts reality is that in the U.K. youngsters are not able to buy until either a parent dies or remortgages a property to release fund, therefore the only alternative is renting for periods of 6 months at a time.
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Old 20th August 2019, 05:52 PM
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Re the last comment. I would hope my children would prefer to have me back but the cold starts reality is that in the U.K. youngsters are not able to buy until either a parent dies or remortgages a property to release fund, therefore the only alternative is renting for periods of 6 months at a time.
It would be more accurate to say that in some part of the UK youngsters are not able to buy. My sister's two sons have both bought their own homes (with the aid of mortgages). The elder bought a 3 bed detached house last year, his first property, and his younger brother traded up to a 3 bed detached also last year. The latter, incidentally, paid 5k less for the property than the original buyers had paid 9 years ago, when it was brand new.

My sister died two months ago (killed whilst she was on holiday in Portugal when she was knocked down by a vehicle whilst crossing the road on a zebra crossing) but she had already seen them settled in their own homes with neither of them needing financial help from parents to buy.
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Old 20th August 2019, 06:46 PM
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It would be more accurate to say that in some part of the UK youngsters are not able to buy. My sister's two sons have both bought their own homes (with the aid of mortgages). The elder bought a 3 bed detached house last year, his first property, and his younger brother traded up to a 3 bed detached also last year. The latter, incidentally, paid 5k less for the property than the original buyers had paid 9 years ago, when it was brand new.

My sister died two months ago (killed whilst she was on holiday in Portugal when she was knocked down by a vehicle whilst crossing the road on a zebra crossing) but she had already seen them settled in their own homes with neither of them needing financial help from parents to buy.
So sorry to hear about your sister, how tragic.

Yes, I would love to see my daughters settles into their own home before I die, but at least if I do I know theyíll have money for a start. My eldest who is a single mum, earns well over 65k. Her job however is in the south east a 2 bedroom flat is nearly 300k . She has requested a move up north where she can buy a three bedroom house for 200k. So yes, you are absolutely correct itís very dependent on locality. My other daughter has a restaurant, near Chichester, unless they buy in a crappy desolate area theyíve got no chance to buy. I donít think either are overly concerned with buying but the rental agreements are such rubbish that they feel trapped in a cycle
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Old 20th August 2019, 06:54 PM
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So sorry to hear about your sister, how tragic.

Yes, I would love to see my daughters settles into their own home before I die, but at least if I do I know theyíll have money for a start. My eldest who is a single mum, earns well over 65k. Her job however is in the south east a 2 bedroom flat is nearly 300k . She has requested a move up north where she can buy a three bedroom house for 200k. So yes, you are absolutely correct itís very dependent on locality. My other daughter has a restaurant, near Chichester, unless they buy in a crappy desolate area theyíve got no chance to buy. I donít think either are overly concerned with buying but the rental agreements are such rubbish that they feel trapped in a cycle
Thanks, I am sure anyone who has lost a loved one suddenly knows how it feels.

I do realise how different it is for people in different parts of the country. My stepdaughter and her partner, who live in the East Midlands, were only able to buy their first property very recently, in their early 40s, with help from an inheritance from his mother. They had never been able to save much of a deposit due to having to pay rent, and my stepdaughter was very nearly homeless at one point before she met her present partner, when she lost her job, payment of Housing Benefit was delayed and her landlord had a policy of not renting to people on benefits. It's dreadful to be in such a precarious position.

Providing she has a good job, I am sure your daughter's quality of life would be much better in the North, with more disposable income. Just tell her to be sure to pack her brolly!
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Old 20th August 2019, 07:21 PM
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Thanks, I am sure anyone who has lost a loved one suddenly knows how it feels.

I do realise how different it is for people in different parts of the country. My stepdaughter and her partner, who live in the East Midlands, were only able to buy their first property very recently, in their early 40s, with help from an inheritance from his mother. They had never been able to save much of a deposit due to having to pay rent, and my stepdaughter was very nearly homeless at one point before she met her present partner, when she lost her job, payment of Housing Benefit was delayed and her landlord had a policy of not renting to people on benefits. It's dreadful to be in such a precarious position.

Providing she has a good job, I am sure your daughter's quality of life would be much better in the North, with more disposable income. Just tell her to be sure to pack her brolly!
She is totally and utterly focused on giving her son the best life possible. Yes, she says the same, disposable income be much better. I have a thought that there might just be a ďmanĒ in the mix 😂

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Old 21st August 2019, 03:39 PM
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A young couple I know had a conundrum a few years back. They lived and worked in Leeds where they had a 4 bed detatched house which was valued at around 375k at the time. He was headhunted and was offered a position which more than doubled his 50k salary but the company was based in West London. They came to have a look at property around Reading/maidenhead area. They were shocked to see that a similar house in a reasonable area was more than double the cost of their house in Leeds. Even with the extra 60k a year salary they couldn't get close to being able to afford the move so ended up staying put. But moving the other way and you'd be quids in, but the majority don't want to do it as they see it as a backwards step. A big shame that property prices in the South are so unrealistic that it hinders career progression.

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Old 25th August 2019, 11:12 PM
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I know this has been discussed before but it keeps coming up in my mind. Iím older, 70, and I rent in Madrid. I had every intention when I came here a year and a half ago, of buying a place. Itís how I lived in NY. But then I read about all the added taxes and fees.
There are added cost in NY too like high maintenance fees..Iím talking apartments, not homes . But as I read stuff here I thought it would be wiser to rent. Iím older, there are more taxes here, I think....Iím not actually sure. Renting seems very precarious to me. I have a nice landlord but I was thinking of moving. I pay a lot of rent and while I do have a lot of space, the way itís laid out, is not useful for me, Iím an artist and I wanted a bedroom to be my studio. But the second bedroom is the size of a nursery.
I should add that the issue of inheritance, of leaving something for someone else, is not a factor for me. Nor is having a mortgage. I would prefer to pay outright.
But for those of you who did buy apartments and homes, could you describe what the pros and cons are? Gracias.
I've bought twice in Madrid. The costs associated with ownership vary but generally I think for a 2 bed apartment you end up paying about 100 euros a month on community fees and maybe 50 euros a month on the local council tax. If the apartment has a pool, gardens, central heating, or is in an older building with higher maintenance then the community fees will be higher to cover these. The purchase costs are about 10% (more if it's a new property). You will also have costs of maybe 3% to sell it.

So let's say you want to buy an apartment for 200k euros and live in it for 5 years. That's about 20k in purchase costs, 9k in community and tax costs over 5 years, and 6k to sell it. So 35k euros altogether (assuming the value of the property doesn't change).

If renting the same apartment was say 700 euros a month then over those 5 years you end up spending 42k euros. So over a 5 year period buying wins, with those figures.

I haven't factored in lost interest on the money that has been used to buy the property, but then again I assumed it wouldn't go up in value either.

Of course you'd need to adjust the figures to suit the apartment you are considering buying, but that's how I would work it out.

BTW you say you're not concerned about leaving the apartment for someone else as an inheritance, but it inevitably will go to someone else if you die while it is in your possession. That someone else might well be decided by the Spanish government under Spanish inheritance law. It might be something you need to look into.

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