I’m currently living within the means of an average income...

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danzig

86 Posts.

1

07/12/18

16:02

Post #: 36787163
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Originally posted by lispingduck ↑

Originally posted by danzig
There’s a lot of different opinions. Some people say the best time to buy is whenever you can. I’ve got a big enough deposit that my mortgage would be equal to what I pay in rent now so it’s not as if it’s some risky investment that I can’t afford. Even if prices may drop in the future, interest could rise. Isn’t there some thing about how The interest rates I can lock in now could potentially save me more long term as opposed to buying later for cheaper but with higher interest? I’m no property expert, I’m just a 25 year old gen Y first home buyer who wants a big 4br house, with enough yard space to have a big dog and without worrying about landlords and their no pet rules. I can’t afford the south/east, don’t like the west, north is alright and It appears to me that Mickleham has pretty good potential assuming the development goes to plan. The developers (MAB) seem like a decent company.
If your rent is currently equal to your rent (a 1:1 ratio) at these low levels of interest rates, what will happen to that ratio after you have bought and the interest rate get increased. Would it likely mean your interest to rent ratio would increase so you end up paying more interest than you would rent?

What the rent be in the area you plan to buyin/move to? Is it the same as what you are paying to live where you are. That’s what you should really be comparing to not what rent you pay to live where you are. For example if you are living in a inner city location pay $600pw. But you plan to move to an area where the rent is $450pw, you comparing inner-city rent with mortgage payment of a fringe suburb home would be incorrect. The comparison of rent vs buying, without taking into consideration other factors such ability to have a big dog etc., should be done on the metric of the same suburb location.

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I’m currently living within the means of an average income earner, but I actually earn a high income. If your question is about affordability, then it’s fine. I am aiming to keep my repayments around or less than $2000/m even though I can easily pay off more than that. If for whatever reason my business falls through and I have to get a regular paying job, I should still be able to manage those repayments. I have factored in interest rate rises and id rather pay more towards my own loan than pay a bit less for somebody elses
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