jay01

It is very British to buy, but is it always wise? We live in a 4 bed finca with 6000m2 orchard on the outskirts of a town, it costs us 500e a month and it suits our needs, had we have bought the same sized house we would not have had much change out of about 250000 even by today's prices.

The average morgage is 25yrs so if your 45 to 50 when you leave the UK you will be 70 to 75 before you have paid for it, so the only one to benefit are those that get it when you peg out. Should we still be here in 25yrs time we will only have paid about 180000 taking into account potential rises and still have the money from the sale of our home in the UK as we are living off the interest it accrues and no bill to pay either end relating to property ownership.

You may only have a small mortgage but you will still have council tax to pay and any other costs relating to house ownership we pay the rent and nothing else, plus if we decide to move there is no property tax for the sale of the house, agents fees, legal fees and should the economic climate be a bit dull the time it takes to actually move.

Whether you rent or buy should depend on age, the younger the better, viability of purchase as opposed to the amount of use and length of mortgage, many people buy with the view to rent out but how many of us actually want people staying in our homes and then that becomes a business and should be declared for tax and insurance. if you pay for it out right you have no long term outlay but still the taxes and should you wish to sell the hassle.

Yes renting maybe dead money but when your late 50's - 60's is buying the right thing to do when you may need to move to more suited accommodation or return to the UK for health or family reasons

jimenato

We rent in Spain.

5 years ago when we first rented our house (it's really nice) it was worth 200,000€ we could have bought it for that and it would have been a "good deal".

Now it is worth 100,000€ and falling. Our rent when we started was 400€ per month - it still is. We are moving out to get a better deal. We have recommended to our landlord a new tenant - a friend of ours. She will pay no more than 300€ per month - the landlord will agree - there are 50 empty houses in our village.

Buy? Absolutely no way would I buy in Spain.

But then that is me - I require a cheap, nice and ultimately disposable place to live. Others have different criteria - and lots of money.

ETA we could probably have rented our house for a couple of years for the same money as just the taxes involved in buying and selling

Lawrence.Brown

You know you are mostly right.
It makes no sense to buy on a mortgage if you are my age and will have to pay it for 25 years. I will be moving over with my mortgage paid up, but without the cash to invest in a scheme to cover the rent. If I had the equity to cover the rent I would obviously rent, but it is going to be much cheaper for me to buy.
I am glad I bought my house, because if I had rented from day one I would never ever been able to go to Spain.
I have bought a family home at a good price, and I am confident my money is well spent.

jackytoo

Never thought I would say it but the only way to go right now in Spain is to rent. I know some who have been trying to sell for at least 3 years...you don't know what is round the corner and if you have bought you could be trapped for years.

whitelinen

That makes no sense, you are advocating renting so why cant your friend rent their Spanish house and use that money to rent elsewhere?

Nobody is trapped, there is always a solution.

jackytoo

Not many are renting either in their area they have been trying to rent for about 6 months, there are hundreds, maybe even thousands empty except for August. Even if they could rent most renters are just low life, they pay for about 2 or 3 months and that's it.

jimenato

It's a renters market - there are empty houses everywhere. The friend might not be able to let their house.

If the friend wants to return to England, rents there will have continued to increase. We let our house in England - it is tiny and I wouldn't want to live in it. The current rent is over £600 (and rising) compared to our nice house in Spain which is 400€ and falling.

One of the previous posts says the situations are different in Britain and Spain and I agree.

Buy in Britain, rent in Spain.

In Spain, rent from the Spanish, buy from the British.

But it's all about personal circumstances and preferences.

scampicat

We have a house in the UK where our son, his girlfriend and a lodger live and pay rent.

We have also bought a house in Spain (in 2003) when we were in our mid-50s.

Why did we buy? frankly, it never occurred to us not to do so. The main reason was that we could not afford to apy rent out of our tiny income and we didn't want (my husband especially) to see our capital eroding month by month paying someone else's mortgage.

Also, we wanted to be able to put our own mark upon the place which you can't do with a rental property.

Our little house in the Granada mountains cost 50,000 euros. We paid cash for this from the proceeds of the sale of a small inherited property in the UK (we sold it for £35,000). Then we bought the derelict wreck adjoining our Spanish house for 17,000 euros from savings and a lump sum from a pension. We then eventually renovated them both at a cost of about 10k euros.

When we sell it, we will be delighted to get 100,000 euros, pleased to get 80,0000 euros and grateful to get whatever someone is willing to pay. Even if we don't get our money back we'll have had the time living here, it will be a small price to pay.

If we had not had the inherited property, we would have sold up and still kept a small flat in the UK. To us this was very important, the parachute that people need, especially if like us they do not intend the move to be permanent.

HBG

If you buy a house in the UK, it's unlikely that your neighbours will put a giant notice outside their house to advertise that they are running a brothel

If your house in the UK faces a park, it's unlikely they'll build a giant Tescos on it.

And in the UK you're unlikely to be fretting in case a bulldozer rumbles along the street to demolish your house.

I own a house in Spain and all those things could happen to me, tomorrow.

Buy in the UK and rent in Spain, as Jimenato said, it's good advice. (And rent from Spaniards).

cricketman

Bear in mind that you have to pay roughly 10% of the purchase price to the government in the form of taxes every time you buy in Spain.

So you'll be paying at least a couple of years rent just in taxes!

Like all have said, it is much better to rent in Spain at the moment, rents are very low, house prices are still too high and people are having problems selling.

Once prices drop by at least another one third, then it may be a good time to buy again.

Lawrence.Brown

I know it is slightly off subject, but you raised an interesting point.
How much tax etc should I be paying on a purchase price of 41000 euros?

cricketman

It depends on the exact region, but normally is around 7%, then there is a tax on your mortgage which of course you wont need if you are paying cash.

So you are talking about around 3,000 euros.

Btw, 41000 euros for a property in Spain is nothing. Is it a wreck in the middle of nowhere? If so then make sure you can actually build on that land and that you can get legal water and electric!

lynnxa

and then the inheritance tax the inheritor has to pay when the inevitable happens

missile

It is not only brits who buy in spain. When I bought, property was regarded to be a safe investment. Now prices are depressed. One can rent cheaper than buy and it seems unlikely that house prices will recover in the near future. Hindsight is wonderful.

Many argue that it is cheaper to rent than buy in Spain and UK. A few others suggest now is the time to buy. Who knows what will happen?

I still consider myself very fortunate to own my property in Spain and UK.

Rotor

I purchased in Spain with no mortgage 7 years ago and even in todays market I would make a profit far greater than interest I could have gained , if you have to mortgage perhaps it`s not worth it currently but if you have cash what else can you do with it? Nothing safer than bricks and mortar......so long as it`s not a new/recent build with dodgy planning

But when all is said and done the UK is still a better/safer place to put your money