More Housey Stuff.
Soo... we had a chat with an IFA last night about mortgages. All very good, very informative, explained everything to us and possibly more besides, very friendly and helpful and doesn't charge us a penny for his services.
As far as I can tell, the upshot of it all is (or why we should buy rather than rent) is to do with building up equity. At the moment, the rent we pay on our flat is roughly equivalent to the Interest we'd pay on a mortgage if we buy the place. So although the mortgage costs more, the extra money we put into it doesn't really go away - it becomes equity in that flat; it's still effectively ours.
So, providing interest rates don't go skyrocketing (IFA would be very surprised if they did), and the price of our flat at least remains the same (IFA suggests that it should actually still increase) we're not really putting ourselves in a worse position other than the increased monthly outgoing (about 500 pcm extra - 250 each).
The more risky strategy is to take out an interest-only mortgate that allows overpayment - so we can pay as little or as much of the outstanding capital amount as we can afford. The risk there is that it relies more on the value of the property increasing if we don't pay the equivalent capital that a repayment mortgage would pay.
My other thoughts are that this amount doesn't include stuff like insurance & maintenance fees, and the upkeep of the property (although our Landlady hasn't done anything to improve it while we've been there either).
The second thought is that, although it's an awful lot for very little at the moment, we should be able to spend an equivalent amount on a larger property elsewhere (outside of a city). The 250k(ish) we're expecting on our 1bed flat would get us a 3bed house where the missus' parents live, with spare change. We might possibly be earning less, but we'd have the equity already paid for in the current flat.
The only thing I really feel the need to check is affordability, while retaining at least some semblance of our current lifestyle. I suspect we can do it, but yeah... need to be totally certain of it.
My more sceptical side is still hunting around for something I might've missed, though. If someone else can spot it, feel free to tell me!
But at the very least, my stress levels about the whole thing have dropped from 9/10 down to about 5/10.
As far as I can tell, the upshot of it all is (or why we should buy rather than rent) is to do with building up equity. At the moment, the rent we pay on our flat is roughly equivalent to the Interest we'd pay on a mortgage if we buy the place. So although the mortgage costs more, the extra money we put into it doesn't really go away - it becomes equity in that flat; it's still effectively ours.
So, providing interest rates don't go skyrocketing (IFA would be very surprised if they did), and the price of our flat at least remains the same (IFA suggests that it should actually still increase) we're not really putting ourselves in a worse position other than the increased monthly outgoing (about 500 pcm extra - 250 each).
The more risky strategy is to take out an interest-only mortgate that allows overpayment - so we can pay as little or as much of the outstanding capital amount as we can afford. The risk there is that it relies more on the value of the property increasing if we don't pay the equivalent capital that a repayment mortgage would pay.
My other thoughts are that this amount doesn't include stuff like insurance & maintenance fees, and the upkeep of the property (although our Landlady hasn't done anything to improve it while we've been there either).
The second thought is that, although it's an awful lot for very little at the moment, we should be able to spend an equivalent amount on a larger property elsewhere (outside of a city). The 250k(ish) we're expecting on our 1bed flat would get us a 3bed house where the missus' parents live, with spare change. We might possibly be earning less, but we'd have the equity already paid for in the current flat.
The only thing I really feel the need to check is affordability, while retaining at least some semblance of our current lifestyle. I suspect we can do it, but yeah... need to be totally certain of it.
My more sceptical side is still hunting around for something I might've missed, though. If someone else can spot it, feel free to tell me!
But at the very least, my stress levels about the whole thing have dropped from 9/10 down to about 5/10.