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Rent is dead money

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    #122
    halkar
    Registered Users Posts: 1,256 ✭✭✭halkar


    fontanalis wrote: »
    Not everyone got a chance to buy at the right time.

    When is the right time? As I pointed out we did not buy in 1995 and paid 3 times the price for the same house at 2000. Same arguments were around at the time e.g houses were overpriced. Did we feel bad about paying 3 times for the same house at the time? No, we were buying home and we needed. Even if the price was 5 times more we would still buy it. We did rent for over 10 years, it was not a settled experience. As the circumstances change so does needs.

    The same argument around saving money can be extended to other materials in life such as cars. Why buy 5-6 cars in 30 years while you can take the bus for 30 years and have half a million in the bank if you save. Why buy a Lcd tv while you can pick a perfectly working portable in a recycling place and watch for 30 years to have ten grand in the bank. And so on, and so on.
    Why live at all :D


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    #123
    cizolin
    Registered Users Posts: 307 ✭✭cizolin


    halkar wrote: »
    The same argument around saving money can be extended to other materials in life such as cars. Why buy 5-6 cars in 30 years while you can take the bus for 30 years and have half a million in the bank if you save. Why buy a Lcd tv while you can pick a perfectly working portable in a recycling place and watch for 30 years to have ten grand in the bank. And so on, and so on.
    Why live at all :D

    Well put, I would agree with what your saying


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    #124
    oflahero
    Registered Users Posts: 765 ✭✭✭oflahero


    halkar wrote: »
    The same argument around saving money can be extended to other materials in life such as cars. Why buy 5-6 cars in 30 years while you can take the bus for 30 years and have half a million in the bank if you save. Why buy a Lcd tv while you can pick a perfectly working portable in a recycling place and watch for 30 years to have ten grand in the bank. And so on, and so on.
    Why live at all :D

    Jaysus don't get carried away man. "Why live at all?" Even right now I could easily afford to live in a rented gaff that I could never afford to buy (at current prices). That's always been the allure of renting for me, I could decide to live in Dalkey tomorrow if I wanted, and move away relatively quickly again if I needed to. Not so with buying.

    What you see as 'unsettled' about renting is actually a plus for other people.

    Granted, I would definitely feel more comfortable raising a family in a gaff that i owned rather than rented, but that's another story...


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    #125
    niallo27
    Registered Users Posts: 16,024 ✭✭✭✭niallo27


    oflahero wrote: »
    Jaysus don't get carried away man. "Why live at all?" Even right now I could easily afford to live in a rented gaff that I could never afford to buy (at current prices). That's always been the allure of renting for me, I could decide to live in Dalkey tomorrow if I wanted, and move away relatively quickly again if I needed to. Not so with buying.

    What you see as 'unsettled' about renting is actually a plus for other people.

    Granted, I would definitely feel more comfortable raising a family in a gaff that i owned rather than rented, but that's another story...

    Well its not another story really, its a legitimate reason for buying a house, but some people care more about money.


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    #126
    MG2
    Closed Accounts Posts: 5 ✭MG2


    beeno67 wrote: »
    You could. The problem is after 25 years you may have your mortgage paid off. If you paid it into your pension, while you will have a very nice pension fund built up you will still have to rent.

    All that really matters is which is the financially better option. Using a pension is just one way to maximise your return to use the saved cash by renting to maximise the return from that option.


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    #127
    beeno67
    Registered Users Posts: 1,218 ✭✭✭beeno67


    MG2 wrote: »
    All that really matters is which is the financially better option. Using a pension is just one way to maximise your return to use the saved cash by renting to maximise the return from that option.

    Yes but it is hard to say which is the better option. If you have a pension fund you cannot touch it until you retire. When you do retire you can take a tax free lump sum but then have to pay tax as you withdraw the rest. If you owned the house you could sell it tax free and still rent.


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    #128
    MG2
    Closed Accounts Posts: 5 ✭MG2


    beeno67 wrote: »
    Yes but it is hard to say which is the better option. If you have a pension fund you cannot touch it until you retire. When you do retire you can take a tax free lump sum but then have to pay tax as you withdraw the rest. If you owned the house you could sell it tax free and still rent.

    Yes it's hard to say which is the better option but if house prices are out of kilter with norms it seems better to rent until they return to normal levels and front load pension contributions until a good point to buy


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    #129
    beeno67
    Registered Users Posts: 1,218 ✭✭✭beeno67


    MG2 wrote: »
    Yes it's hard to say which is the better option but if house prices are out of kilter with norms it seems better to rent until they return to normal levels and front load pension contributions until a good point to buy


    I would disagree. If you decide to rent with a view to buying in the near future then it makes more sense to put the extra money into a savings account so you have the money to buy when the time comes.

    The benefits of personal pensions are oversold I believe. Everyone mentions the tax advantage when putting money into a pension but don't mention that you will have to pay tax at the other end. You have to be a top rate tax payer before they start making sense and then that is really for the tax free lump sum which may not be tax free for much longer. Also your money is tied up for 40 years.


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    #130
    ricman
    Closed Accounts Posts: 1,559 ✭✭✭ricman


    I,M not advising anyone to buy an apartment for 450k, i think its worth while spending 150k,or 200 on a 3bed house for a couple rather than pay 600euro per month rent for 50 years.
    Pension funds were sold on the point of tax credits for the last ten years,its been shown ireland has the worst pension investment record of any european country with the highest administration fees .
    LIKE the banking system the regulation was lax and designed to help big business and god help the taxpayer .


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    #131
    MG2
    Closed Accounts Posts: 5 ✭MG2


    beeno67 wrote: »
    I would disagree. If you decide to rent with a view to buying in the near future then it makes more sense to put the extra money into a savings account so you have the money to buy when the time comes.

    The benefits of personal pensions are oversold I believe. Everyone mentions the tax advantage when putting money into a pension but don't mention that you will have to pay tax at the other end. You have to be a top rate tax payer before they start making sense and then that is really for the tax free lump sum which may not be tax free for much longer. Also your money is tied up for 40 years.

    Depends on your circumstances - it's one tool to maximise your return. Personally, I have my deposit ready to go so increasing my pension contributions is a way of efficiently using some of the excess cash.

    For anyone renting with a view to buying, it's still something that should be considered as a use for some of the savings.


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