Happy 3.14 to everybody.
In other news, Katy and I have decided that we're out of the housing market for the foreseeable future. We've been talking/thinking about it for a while now and finally came to a decision today.
We currently pay £780 a month in rent. If we were to get a mortgage, we'd be paying £1600. That's how crazy the housing market is in Cambridge. We could afford it, but we would have no leeway in case interest rates went up, and things would be tight if/when we had kids and we'd be down to one income for a while.
We've decided to do something a bit different. We're going to stick to the budget we decided on and worked out while we were crunching the numbers. If we put away £600 month in an ISA at 5.5%, we have £7500 saved in a year. If we do that the 7 years I have left on my contract, we come out of it with something close to 50K. That's not bad at all.
Now, people will say that if we did get a mortgage, we could probably make double that in the profits of selling our hose in a rising housing market. Maybe. Yes, it is tempting to think of it that way. The housing market in Cambridge is insane and will probably only get worse. The EBI AGM this morning informed us that staff levels will probably go from 250 to 400 in the next 5 years. Then there's London commuters that are forever going further out of town in the attempts to get more bang for their housing buck (and piss off everybody else in the process). So yes, chances are good that we'd make money if we bought a house now and sold it in 7 years. The thing is that we're not sure if we could afford it now. Interest rates are set to rise. People keep saying that the housing market needs a big correction or else it'll self-implode. You have experts arguing both sides of the same situation. So yeah….
We could make more money, we could make the same amount. In the end, I think we'll go the ISA route. We might not make more, but we'll make some and I'll probably end up sleeping better at night.
