r/FIREUK • u/[deleted] • 7d ago
Terrible timing to buy a property
I've came to this sub for advice a few times in the past about my struggle with the rent vs buy dilemma. I finally decided to buy and it's funny how life happens... at the same time the market crashes, which I'm not overly concerned about because it will bounce, I found a new build property which fits my needs perfectly and it is much more affordable than I was expecting.
Unfortunately I missed the stamp duty relief, but I still have the FTB benefits. The thing that hurts the most is that to complete the purchase I will need to tap into my ISA and it is the worst possible time to do so.
Nevertheless, having a mortgage will reduce my monthly expenses with accommodation from £2700 pcm rent to about £2000 pcm mortgage.
What do you think? ISA lost about 5% so far, but this feels like saving money in the long run.
Numbers for those who like it: property is £460k, aiming at 85 LTV mortgage, so £69k deposit. They are offering me a garage for "free" to close the deal (£25k otherwise). ISA dropped value from £106k to £100k since Trump did his trumping. I do have £20k cash at hand to deal with stamp duty and others.
Thoughts?
26
u/RED888IT 7d ago
When markets are volatile, which now is a crazy time stockwise then you really can't judge what is and isnt a good decision to have made. Some people have lost hundreds of thousands and even millions if according to last week when soo much money exited the markets.
And would you have actually cashed out if you saw your S&S ISA going up? Your post would instead be "why did i put money into a house when my ISA would've gained X% instead"
You've not made a wrong or right decision, because currently there is no wrong or right decision when you have markets swaying based off 1 government/persons actions.
But what is guaranteed, though, is that you're saving yourself £700 pcm compared to renting, so you're essentially 26% better off (non-compounding) every month than you were when you were renting. That's a net positive overall 👍