Renting is dead money

dinnyirwin · 15-02-2014 01:34PM

MonstaMash wrote: »

http://www.formerglory.ie/property-heathfield.html

How much do you want for it?

stimpson · 15-02-2014 01:34PM

House prices have started to rise again in Dublin. The optimum time to buy was about a year ago. The same smug pundits will still be pissing their rent up the wall while the market goes up.

At the end of the day my mortgage is €300 less per moth than renting in the area. Even if I am in a bit of negative equity I can still makeup repayments and will have something to show for it in 20 years. I can't fathom how I would ever be better off renting.

dissed doc · 15-02-2014 01:36PM

Chazz Michael Michaels wrote: »

Remember that old chestnut from the noughties?

Well, I'm starting to hear it creep back into common use in pub conversations and what-not. Have people learned nothing? To my mind, renting is paying for a service, which is shelter. It is no more dead money than paying for electricity is. In both cases, you hand over money for something you use, but receive no tangible asset. But its not a waste of money, because you benefit from a service.

If legislation was changed to increase the rights of tenants in long term leases, like in central Europe, I would never buy property, and invest my money in something less illiquid.

Next we'll be hearing this "ladder" sh1te again...

The legislation in Ireland is stacked against landlords and the PTRB is heavily biased against landlords. It is a requirement for a landlord to be a surrogate mammy and even supply a microwave. That is what people want. Then trash the place, pay no rent for a year, and get off scott free.

mfergus · 15-02-2014 01:38PM

What about if you're renting a place with decking??

barone · 15-02-2014 01:41PM

the whole point of buying versus renting to me is that eventually you will have a home that costs you no more rent ever, so long as ya dont go beyond your means,or likely means then i think renting long term is silly.

when you retire you should have paid off your house,you can stay rent free.. sell and move away etc etc..

Fudge You · 15-02-2014 01:41PM

stimpson wrote: »

House prices have started to rise again in Dublin. The optimum time to buy was about a year ago. The same smug pundits will still be pissing their rent up the wall while the market goes up.

At the end of the day my mortgage is €300 less per moth than renting in the area. Even if I am in a bit of negative equity I can still makeup repayments and will have something to show for it in 20 years. I can't fathom how I would ever be better off renting.

What are you going mad for?
Who are these same smug pundits???
You kinda sound smug, by your comments "pissing their rent up the wall". "Ill have something to show for it in 20 years"

Kinda a pot/ kettle arent ya?

MonstaMash · 15-02-2014 01:43PM

dinnyirwin wrote: »

How much do you want for it?

To PM's

donegal__road · 15-02-2014 01:44PM

say for example you borrowed €250,000 in 2006 to buy an apartment.

Total repayments on €250,000 @ 4% for 30 years = €433,725

What will your apartment be worth in 30 years is the question.

bnt · 15-02-2014 01:48PM

dinnyirwin wrote: »

I think everyone takes that as a given.
We all know not everyone can buy a house. It was never the case and never will be.
Also some people cannot buy until they reach a certain stage in life either.

Maybe, but there was a time when a family with a single modest income could afford a house. There are surveys of housing affordability, and according to the latest (pg 27) property in Ireland is becoming affordable again ... as long as you aren't trying to buy in or around Dublin.

Ireland's challenges could be great. The national statistics bureau, the Central Office of Statistics (CSO) recently projected that the Dublin metropolitan area will experience population growth of 22 percent between 2011 and 2031. The high projected population growth could lead to house price increases that could equal those of the last decade.

I think the "renting is dead money" folks are making some unwarranted assumptions about the future. For example, interest rates are low, but are they going to stay low for the next 25 years? Remember that you can easily pay twice the mortgage amount, over time, due to compound interest.

Then there's the assumption that you will be able to sell the house at a good price at a time of your choosing. Firstly, you may not be able to choose when, due to circumstances beyond your control. You can't control demographic shifts - your desirable area might not always be desirable. Having seen the inside of a few houses in the Dublin area, I have to wonder what kind of expensive repair work these houses will need, over 25 years later, assuming they are still in one piece by then.

shruikan2553 · 15-02-2014 01:48PM

A problem with renting is estate agents. They only want 1 year contracts so they can up the rent and at the end you are left dreading what problems or damage is your fault so they're taking as much money as possible.

stimpson · 15-02-2014 01:49PM

Fudge You wrote: »

What are you going mad for?
Who are these same smug pundits???
You kinda sound smug, by your comments "pissing their rent up the wall". "Ill have something to show for it in 20 years"

Kinda a pot/ kettle arent ya?

Calmer than you are.

alias06 · 15-02-2014 01:50PM

If you don't buy now you'll never get on the ladder

Gran Hermano · 15-02-2014 01:51PM

Dead money?
Renting, not always.
Undertakers, always.

donegal__road · 15-02-2014 01:53PM

Having seen the inside of a few houses in the Dublin area, I have to wonder what kind of expensive repair work these houses will need, over 25 years later, assuming they are still in one piece by then.

I think people should speak to some of the workers who were involved in the construction of property during the boom, before they decide to buy a house.

Many of the houses were thrown up in a few weeks with massive short-cuts taken.

krudler · 15-02-2014 01:54PM

Femme_Fatale wrote: »

Not an issue if they can afford it though? I can afford my mortgage quite comfortably.
But I agree renting is not dead money. Silly phrase. However there's utterly nothing wrong with arriving at the stage of wanting to buy a home when you have the means to do so.
Yeh I know the bank owns it and whatnot, but you still have much more ownership than you would when renting.

This basically, if/when I can afford to take on a mortgage and find someplace where I want to live well, forever basically then I'd buy a house, right now I want to travel and don't want to commit myself to something like that so am happy renting.

donegal__road · 15-02-2014 01:54PM

alias06 wrote: »

If you don't buy now you'll never get on the ladder

dont make this mistake please.

alias06 · 15-02-2014 02:00PM

donegal__road wrote: »

say for example you borrowed €250,000 in 2006 to buy an apartment.

Total repayments on €250,000 @ 4% for 30 years = €433,725

What will your apartment be worth in 30 years is the question.

If you have the money to do this and it makes sense then go for it. But there is absolutely no point worrying about 30 years time. With the way the world is going with climate change, economic instability and over population we just have no idea what property will be worth in 30 years time at which point you'll probably have more serious things to worry about like your physical health. You can't take it with you anyway.

alias06 · 15-02-2014 02:01PM

donegal__road wrote: »

dont make this mistake please.

I was joking.

scrubber72 · 15-02-2014 02:02PM

We (my wife and I) are renting for the last 7 years. When we decided to get engaged we also applied for a mortgage of 240k. We were approved but couldnt find a house worth that value wise. Lots of crap out there.
Forward two years and wife loses job. No pay off just bye bye see ye later. Find plenty of ok houses that fit our criteria but not the one.
Forward another year wife starts working again and we talk to bank about our options. They say she has to be in full time employment for 18 months, we wait until then and are told that we can get 100k. Found it very difficult to get a place for that money.
Then 2 years ago she is made unemployed again so we are completely back to square one.
We called around to the banks and we are either told that they wont give us anything or in the case of one bank they offered us 20k. I told them i was looking for mortgage not a car loan.
I am on 42k per annum and we have roughly 40k in savings.
Its all down to our NDI which I believe are completely untrue figures that the banks use.
We pay 700 euro on rent, have no debts or loans and now a daughter.
For years we tried to find a home but its not for us as the banks say.
All my friends had said get on the ladder quick but now more and more of them say we are better off in the situation we are in now, with our savings that they don`t have.
Maybe some day we may get somewhere but until then we have to rent so to me "no its not dead money".

sonandheir · 15-02-2014 02:05PM

snubbleste wrote: »

Sure get a mortgage anyway and if you can't afford to pay at some point, you'll get to stay in your "family home" as long as you pay a token amount. The Government will make sure you are not turfed out on the street by protecting you, but if you are renting and can't afford it, well tough!

I recently bought a house and the above rationale played a big part in my decision. Me and my family would be simply turfed out of our house if I lost my job and was renting, but we are far more secure not paying our mortgage. The banks/government are never going to evict a family with 1 family home(no investment properties). Can you imagine the primetime special.

bnt · 15-02-2014 02:07PM

donegal__road wrote: »

dont make this mistake please.

But ... didn't you get the memo? This time is different, it says.

Drakares · 15-02-2014 02:07PM

Weathercheck wrote: »

Well rent is so high at the moment, that sometimes it works out as better value to purchase a house.

I rent a boat for 230 a week, I can buy one for 50 grand and sher in the long term it's better value and I'll only be paying it back for the rest of my life!

Genius logic

15-02-2014 02:11PM

Red Crow wrote: »

Technically it is 'dead money'. But I can see the arguments to both sides. On one hand you gain ownership of an asset but you also gain long term debt and on the other you just get use of an asset but no debt hanging over you.

Everybody to their own. The people telling us about how great renting is are as bad as those telling you to get on the property market.

Exactly.

Fudge You · 15-02-2014 02:12PM

stimpson wrote: »

Calmer than you are.

Great comeback. Read your post again. You have a chip on your shoulder.

kippy · 15-02-2014 02:13PM

Drakares wrote: »

I rent a boat for 230 a week, I can buy one for 50 grand and sher in the long term it's better value and I'll only be paying it back for the rest of my life!

Genius logic

Tell me more about this boat you rent and how exactly renting it compares to renting a portion of a house?

Femme_Fatale · 15-02-2014 02:17PM

No need for hostility towards people who can afford their own gaff. If you're young too, there is a likelihood of you changing your views on this in 10 years' time.

The crowd who sneered at others for not being on the property ladder (not that I encountered them myself, but was probably a bit young at the time) were arseholes; the "I told you so" crowd are as bad though.

kippy · 15-02-2014 02:17PM

bnt wrote: »

Maybe, but there was a time when a family with a single modest income could afford a house. There are surveys of housing affordability, and according to the latest (pg 27) property in Ireland is becoming affordable again ... as long as you aren't trying to buy in or around Dublin.

I think the "renting is dead money" folks are making some unwarranted assumptions about the future. For example, interest rates are low, but are they going to stay low for the next 25 years? Remember that you can easily pay twice the mortgage amount, over time, due to compound interest.

Then there's the assumption that you will be able to sell the house at a good price at a time of your choosing. Firstly, you may not be able to choose when, due to circumstances beyond your control. You can't control demographic shifts - your desirable area might not always be desirable. Having seen the inside of a few houses in the Dublin area, I have to wonder what kind of expensive repair work these houses will need, over 25 years later, assuming they are still in one piece by then.

Thats all fair.
But there are similiar assumption coming from strong advocates of renting all your lives.
When the proprty crash came there were a lot of people predicting a crash in rental prices. That may have happened for a short period but generally rents have increased significently over the past few years especially in Dublin.
Again i aint for one or the other. There are lots of factors that come into it.

Fudge You · 15-02-2014 02:24PM

Femme_Fatale wrote: »

No need for hostility towards people who can afford their own gaff. If you're young too, there is a likelihood of you changing your views on this in 10 years' time.

The crowd who sneered at others for not being on the property ladder (not that I encountered them myself, but was probably a bit young at the time) were arseholes; the "I told you so" crowd are as bad though.

Wow wow wow.
I love being in the "I told ya so" crowd. haha...

Good post btw. Makes sense.

dinnyirwin · 15-02-2014 02:26PM

alias06 wrote: »

If you have the money to do this and it makes sense then go for it. But there is absolutely no point worrying about 30 years time. With the way the world is going with climate change, economic instability and over population we just have no idea what property will be worth in 30 years time at which point you'll probably have more serious things to worry about like your physical health. You can't take it with you anyway.

Dont know how much rent will be in 30 years time either.

dinnyirwin · 15-02-2014 02:29PM

sonandheir wrote: »

I recently bought a house and the above rationale played a big part in my decision. Me and my family would be simply turfed out of our house if I lost my job and was renting, but we are far more secure not paying our mortgage. The banks/government are never going to evict a family with 1 family home(no investment properties). Can you imagine the primetime special.

But if you end up on social welfare you are better off renting.
Social welfare will pay your rent but wont pay your mortgage. They might pay part of the interest for a while, but you still gotta come up with hundreds, if not thousands yourself to pay your mortgage.

Renting is dead money

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