This article has given me an awful lot of food for thought! I’m getting married next year and I was planning on following the social convention of get married, buy house, have kids. And I always held the view that renting was throwing away money but today I have actually done some research into it and I am really questioning that view. It is very refreshing to see some actual debate instead of the standard “renting is throwing away money” argument.

Hard Facts:
So i am 22 and i am on £22,000 a year in the U.K. I went in for mortgage advice today and they said that due to my income and my available deposit. The maximum amount I could borrow would be £130,000 on a 25 year mortgage. Which frankly has shattered my dreams a little. Using on-line mortgage calculators and good old excel id worked out i could “afford” the payments on a £210,000 house. I also had plans on renting out my current flat!

So the first stark reality I had to face is that it doesn’t matter what you can afford its what the banks think you can afford!

Secondly i always saw buying a house as an investment, but like the points mentioned here, if you factor in interest payments and repairs, surely if that extra money was going into savings (for example high earning tax free ISAs) then it would probably work out as a higher returning investment! Plus a house is only really an investment that you can cash in when you sell it (or rent it out, which can mean a more expensive “buy-to-let” mortgage) or live long enough to enjoy the benefits of a paid off house. I at 22 thought that I would do well getting a house paid off by the time I was 50, but in reality if we bought a house for 140,000 today we would be looking towards getting a bigger house further down the line. Plus I might get hit by a bus and then Id be really annoyed

So came my second realisation…maybe buying a house is throwing away money (in certain scenarios)!

I am still in limbo on my decision. I like the idea of saying “I own my house” but surely that just makes me a pompous idiot who values peer acceptance over my own financial well-being. However I also want to own my families home, never face the prospect of being thrown out and being allowed to decorate, own pets and improve the house at my will. As well as eventually pass it down to my children giving them a stronger start in life (on that point though, my mum owns her home outright and I would like to make it on my own instead of asking her to sell her home or release equity, its something i absolutely would not consider).

I’ve rambled here but I wanted to add my “example case”. I get the feeling the housing market in Vancouver is very different to that in the UK but the ideologies don’t seem to differ .

I would love to here what you guys think and I look forward to letting you know how i get on!

Mike