good summary, of course there are less tangible factors to be weighed up:I think what your proving can be explained basically as this:
Say interest rates are 6% (on savings and mortgages). If rental yields are 3.5% then you are financially better off renting (or deferring trading up) in periods where annual house price increases are less than 2.5%.
It's as simple as that.
Some of the scenarios above show savings as a result of staying longer in the less desirable house, these need to be offset against the benefit of actually living in a better house. I will obviously save money if I drive round my '94 fiesta for a few more years rather than buy a BMW.
I believe he said that his decision would be based on what 'they say'.Interesting. Are you saying that your decision will be based on the valuation of a single EA?
If that is so, then your approach to making a decision seems much simpler than mine would be.
OK -so we had 2 ea's over on Friday. One reputable 'independent' and one big national one. (not sure if I can give out the names) The big one valued it at 600k and the local guy at 620. The big crowd won't move off the 1.5% fee whereas the local guy is only 1%. We are going to take the plunge, god knows how long it might take to sell.
Sounds like a plan to sell low and buy high, which may not be the best approach in the long term. Your extra 70k will not be much use if the price has gone up €150k in the meantime. It's a huge gamble you are taking.I'm also thinking about selling up now and buying again in a couple of years time. If I do I can afford to save roughly 35k a year after paying rent. This will give me an extra 70k to put towards the purchase of a new house with any profit I make now. Sounds better than staying put and loosing money by the month! But in saying that I'm still in the thinking stage and weighing up the pros and cons. Fair play to you op for taking the plunge, be interesting to see how you get on.
Yes but at least the 300 is making about 4% interest (or simply not being eroded by inflation) whereas only about 40% of the monthly mortgage repayments are paying capital of an asset depreciating at a rate of...well lets say slightly more than 4%But your rental payments, unlike annuity mortgage repayments, are not purchasing any equity in the property in which you live.
Not much is proven until the time comes when the OP buys a house.Well done sangster - you proved us all wrong!