Buying property or renting in the UK, in old age.
April 27, 2011 1:14 PM Subscribe
UK Filter: Can people retire without buying property when younger?
posted by TrinsicWS to home & garden (22 answers total) 3 users marked this as a favorite
TLDR: Is it possible to live out our old age in the UK without buying property, with only renting? How is this possible?
Here's the meat of the question:
I have been working in the UK for two years, and I'm seriously considering laying down roots here. Now one big question, is property. So far the ground work I've done include reading bits and pieces online, as well as asking colleagues about mortgages, why they don't buy etc.
I'm currently paying pretty high rent, rent that is about that of some mortgages (well, "estimates" on the web). Hence, if I'm going to stay here in the UK for a long term, would it make sense to purchase property? From my absolutely non-streetwise point of view, I'm paying rent, which provides me with a roof over my head. However, from another point of view of someone who may want to stay on, is that buying property means that I can have an asset at the end of the mortgage.
Right now, my salary is split into roughly
1/3 - Rent
1/3 - Savings
1/3 - Day to day spending.
If I were to get a mortgage, I would imagine it would be
1/3 - Mortgage
1/3 - Savings
1/3 - Day to day spendings.
Is it wrong to imagine this situation? Granted, I do need a few more years before I can plonk down a deposit (london is so expensive), but I keep thinking that renting does not make sense, unless I intend to move to another country.
But if I decided not to purchase property, and continue this saving/renting routine, what happens when I "retire"? Do I use these savings to rent in the future? This is the part I'd like the hive mind's thoughts on.
Hope this post is not too unclear.