Option 1: Buy 25% of a 1 bed flat, the share is worth 125k, the property is worth 450k for 100%. So mortgage would be for 100k and I would pay rent/service charge for the 75%. Mortgage + rent + service charge is coming to about 1.5k/month.
Option 2: Mortgage (25 years) of a 1 bed flat, worth 400k. Repayment comes to about 1.7k/month.
Assume I have 25k deposit. Both are in the same location and otherwise similar. Both are affordable on my salary.
I don't plan on living in a 1 bed flat for my life, so after say 3-5 years, can I 'sell' it, pay off the mortgage pending, and use the proceeds to buy a new place? The issue is I doubt a 1 bed will appreciate that much in 3-5 years, say by 20k, but interest on a 375k mortgage > 100k mortgage.
Any advice on what is a better option here?
Submitted May 05, 2019 at 04:38PM by lseactuary http://bit.ly/2LkCEpI
