Rent vs. Buy ...

[Matt]

Ah ... that time old question in the property market ... Rent vs. Buy ... I can't decide.

Should I take out a mortgage? or not?

I work in the financial services buz ... so I know about investing and markets so I can invest my shares/equity and get a decent return ...

I don't need the property markets to make a decent return on my investment ...

However here's what is concerning me;

Demand for dwellings is increasing due to immigration and popluation growth ...

Whilst supply in the housing market is low, and the the supply shortage is increasing ... so rental yields will continue to get lower (i.e. low vacancy rates) ... whilst at the same time house prices will keep rising.

Housing prices are rising whilst rental payments are increasing ... Can't win ... damned if you do, damned if you don't.

What have you done? Rent or buy? Would be interested to hear your experience.

[lignator]

Assuming that you have secure employment and can service a loan..

Renting means uncertainty of tenure should the landlord decide to sell to owner/occupier at end your lease.
Buying means establishing your preferred location for family/employment/transport/amenity reasons.
Rental Cost will keep rising in line with inflation.
Initial purchase price (loan amount) remains stable whilst inflation increases house value.
The increase in equity is tax free.
Repayments could be "locked in" at fixed interest to minimise concerns at interest rate rises.
Beware of early loan repayment fees. Recent cases of many thousands of dollars in fees for breaking a fixed interest loan.
Buying means additional costs via rates, land tax and maintenance.
If you treat maintenance/renovation as a hobby, it will pay you dividends via tax free capital gain (after a minimum of 12 months of ownership).
Ownership is a good method of "forced savings".
Home ownership is a long term strategy.

All Boiled down..Are you ready to settle and commit for years.

I have bought and sold lots. I would not sell now, but would buy more if I were able.

Seek independent advice from your financial advisor (Not the person who is giving you the loan)

Good Luck..

[matthewa]

Hey Matt,
In you decision to rent or buy, you'll probably need this:
The Ultimate Guide to Renting Property!!

http://www.*********************/ultimate-guide-to-renting-property

There's a free PDF in that link, and you can access calculators and tips so you can be more informed about renting. (At the moment, I'm a renter myself)

[electra]

Hey matt i'll definetely won't suggest you to take mortgage if your don't have well established job but as you said that you work in a financial services buz so that sounds a wealthy job so you don't have to hesitate to take mortage....
As you know investing in property is always a good future investment but you have to wait for long to get back high yield on your investmenst on the other hand investing in shares/equity is far more risky then investing in property.....So i recommend you to take mortgage and buy..