Justifying an "expensive" car purchase...
Discussion
HeatonNorris said:
Some would say you don't really have the money until you've bought (mortgaged) a house. If you're living with parents / in a shared house or even renting, then the house has to be no. 1 priority.
Cars get cheaper... houses generally go up in price.
I don't want to buy a house until I feel completely settled (which I haven't for several years). I've just relocated to Bristol and hope that this is where I'll stay for a good few years. I therefore imagine I'll consider buying a house in 3-4 years. Does that mean I should start saving for a mortgage now? Or do I take this opportunity to buy a heralded sports car? I could always consider the car as a saving pot?! Cars get cheaper... houses generally go up in price.
Biccaroo said:
I don't want to buy a house until I feel completely settled (which I haven't for several years). I've just relocated to Bristol and hope that this is where I'll stay for a good few years. I therefore imagine I'll consider buying a house in 3-4 years. Does that mean I should start saving for a mortgage now? Or do I take this opportunity to buy a heralded sports car? I could always consider the car as a saving pot?!
To get a decent mortgage deal, you need a decent deposit.You're not going to save that if you put your money into a high maintenance and depreciating asset.
HeatonNorris said:
To get a decent mortgage deal, you need a decent deposit.
You're not going to save that if you put your money into a high maintenance and depreciating asset.
Indeed. But, on the continent everyone rents their entire lives. Who says that a mortgage is the right way to go? Is it because we're all sheep and believe we should follow the crowd or is it truly where the safe money goes? The thing is, in playing it safe many people commit to years of poverty because their mortgage dominates their spending. Then, when they're old and wrinkly and life has passed them by, they no longer have the energy or desire to enjoy life as they could've when they were younger! Oh dear, I've started to rant... ! You're not going to save that if you put your money into a high maintenance and depreciating asset.
Biccaroo said:
HeatonNorris said:
To get a decent mortgage deal, you need a decent deposit.
You're not going to save that if you put your money into a high maintenance and depreciating asset.
Indeed. But, on the continent everyone rents their entire lives. Who says that a mortgage is the right way to go? Is it because we're all sheep and believe we should follow the crowd or is it truly where the safe money goes? The thing is, in playing it safe many people commit to years of poverty because their mortgage dominates their spending. Then, when they're old and wrinkly and life has passed them by, they no longer have the energy or desire to enjoy life as they could've when they were younger! Oh dear, I've started to rant... ! You're not going to save that if you put your money into a high maintenance and depreciating asset.
What's better... a few years in a flash car now, and a mortgage into your 50s, or a house bought and paid for by the time you're 40 and a further 30-40 years of being able to spend without worry?
HeatonNorris said:
The only people committed to years of poverty are those who blow their money on frivolous toys instead of getting their life financially sorted first...
What's better... a few years in a flash car now, and a mortgage into your 50s, or a house bought and paid for by the time you're 40 and a further 30-40 years of being able to spend without worry?
Hmm, I don't know anybody who's paid their mortgage off by the age of 40. In fact, most people I know are still paying off their mortgages well into their 50's. That's a substantial amount of their lives. And these people have never owned flash cars either...What's better... a few years in a flash car now, and a mortgage into your 50s, or a house bought and paid for by the time you're 40 and a further 30-40 years of being able to spend without worry?
HeatonNorris said:
Silver said:
If you have the money for it and you want to do it then go for it. Life's too short.
Some would say you don't really have the money until you've bought (mortgaged) a house. If you're living with parents / in a shared house or even renting, then the house has to be no. 1 priority.Cars get cheaper... houses generally go up in price.
You spend your life working to earn money, you should at least spend it on the things you want to spend it on. If property floats your boat then clearly cars are off the menu unless you earn ££££. If you want to enjoy your salary while you're young then I don't see why you should feel that you can't.
Edited by Silver on Friday 13th July 22:45
Biccaroo said:
Hmm, I don't know anybody who's paid their mortgage off by the age of 40. In fact, most people I know are still paying off their mortgages well into their 50's. That's a substantial amount of their lives. And these people have never owned flash cars either...
No, but I bet they've blown a substantial proportion of the value of their house on the depreciation on a succession of new or nearly new family hatchbacks or similar...If you are fairly frugal and don't take out finance on depreciating vehicles, then it's quite possible to pay off your first or second house by the time you're 40.
(Think about it - £250 / month, for, say, 15 years... that's £45k with very likely nothing to show for it other than a 5 year old mundane car... that's 1/3 of the value of my (paid off, at 35 years old, a few years back) house).
Silver said:
Yes, but buying a house isn't the be all and end all. No-one HAS to buy property. If it doesn't suit their lifestyle or working patterns then what's the issue?
This is what I've considered. Why do we HAVE to buy a house at all? The government takes everything from you when you die above the average value of a house anyway! But seriously, surely there are different ways to live your life, or are we all programmed to do everything the exact same way? I've got plenty of friends who have taken the tried-and-tested route and I never see them any more because they can no longer afford to enjoy their lives. They just sit at home watching crap on TV or moaning about their money worries. And this all stems from having a bloomin' mortgage! Biccaroo said:
This is what I've considered. Why do we HAVE to buy a house at all? The government takes everything from you when you die above the average value of a house anyway! But seriously, surely there are different ways to live your life, or are we all programmed to do everything the exact same way? I've got plenty of friends who have taken the tried-and-tested route and I never see them any more because they can no longer afford to enjoy their lives. They just sit at home watching crap on TV or moaning about their money worries. And this all stems from having a bloomin' mortgage!
People have mortgages because it's more cost effective than renting, which is just taking a big chunk of your money and effectively setting fire to it every month. But seriously, surely there are different ways to live your life, or are we all programmed to do everything the exact same way? I've got plenty of friends who have taken the tried-and-tested route and I never see them any more because they can no longer afford to enjoy their lives. They just sit at home watching crap on TV or moaning about their money worries. And this all stems from having a bloomin' mortgage! HeatonNorris said:
No, but I bet they've blown a substantial proportion of the value of their house on the depreciation on a succession of new or nearly new family hatchbacks or similar...
If you are fairly frugal and don't take out finance on depreciating vehicles, then it's quite possible to pay off your first or second house by the time you're 40.
(Think about it - £250 / month, for, say, 15 years... that's £45k with very likely nothing to show for it other than a 5 year old mundane car... that's 1/3 of the value of my (paid off, at 35 years old, a few years back) house).
You're right and I agree with you. I just hate that it has to be like this! As I said in the previous post, for many people a mortgage is the ball-and-chain of their life and prevents them from living life to the full. I don't want this but it would seem we have no choice. It's a subject that I could discuss for days so I'll stop now. At the end of the day, I just need to decide whether to buy a hedonistic vehicle or keep it sensible.If you are fairly frugal and don't take out finance on depreciating vehicles, then it's quite possible to pay off your first or second house by the time you're 40.
(Think about it - £250 / month, for, say, 15 years... that's £45k with very likely nothing to show for it other than a 5 year old mundane car... that's 1/3 of the value of my (paid off, at 35 years old, a few years back) house).
HeatonNorris said:
People have mortgages because it's more cost effective than renting, which is just taking a big chunk of your money and effectively setting fire to it every month.
Quite. But this country appears to exist on the notion that it's everyone's right to own property regardless of their circumstances, desires or needs. If one has no need, desire or feel that it's their right to a mortgage then there's no reason for them not to spend their money on something they enjoy. Biccaroo said:
Okay, scrap the £8-12k budget. What can I get that's not an MR2 but is as good as a Boxster or Elise but for around £4-£6k instead? A Renault Clio 197? Honda Integra? What would you suggest?
Well, you could get a Boxster... or the predecessor to the Elise - the M100 Elan. It's FWD, but has bulletproof Isuzu oily bits, and the best handling FWD chassis of all time.HeatonNorris said:
People have mortgages because it's more cost effective than renting, which is just taking a big chunk of your money and effectively setting fire to it every month.
It all depends on the situation though. And buying a house now has just as much chance of leaving you in negative equity as it does to leaving you with capital growth. I'm happy renting, I'm paying 1.3% of the house value per year as rent - I can get more than that in interest by keeping the cash in my bank, and I think the prices will drop before they increase again (villa worth a few million on a golf course in Portugal)Biccaroo said:
HeatonNorris said:
You're right and I agree with you. I just hate that it has to be like this! As I said in the previous post, for many people a mortgage is the ball-and-chain of their life and prevents them from living life to the full. I don't want this but it would seem we have no choice. It's a subject that I could discuss for days so I'll stop now. At the end of the day, I just need to decide whether to buy a hedonistic vehicle or keep it sensible.
For some yes. For others it's cheaper than renting. For example it would be roughly £500-600 more a month to rent an equivalent house to the one I'm paying the mortgage on. It's also something to take the long term view on. For the first year, maybe two things will be tough but beyond that the mortgage drops relative to income. Our last house started with a mortgage that was ~50% of my net wage, by the time we moved it was 16%.Anyway, to move back to cars the trouble comes when people want more than they can afford. Which is where it comes back again to people buying new cars that cost more than their yearly salary!
There are a million older hedonistic vehicles that can be had and run for relative pennies. By spending 12k on one car you will lose a fortune. Over the same period spend 12k on a 3k car every year and you'll lose virtually nothing and can enjoy some fantastic metal.
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