House Market Opportunity?

[Dag_Nabbit]

Friends of ours have recently moved abroad and kindly offered their house at a reduced rent when their current tenants lease has expired (4mths time). Since our houses are identical (same size, same street) would it make sense to jump off the housing ladder, bank the property equity in an interest account and pay less in monthly rent than current morgage payments. Or will house price inflation (even though slowing down) continue to outstrip any interest accounts available and result in a backward finacial step. I would really like to know people opinions, as the bottom line is, I like my house and would really be quite upset if the effort resulted in little or no gain, but this seems an opportunity to be considered.

[WoWo]

I find these sort of threads can get a little heated and sometimes we read into each others posts something thats not there. So sorry if any of my posts seem that way as they are not meant to be. My decision to do what I have done is based firstly on a quality of life issue and the secondly on the financial aspect. Both my wife and I work in London and we travel for long hours every day. By doing what we have we will be able to spend much more time together and thats at the core of why I'm doing it. Its not such a risk for me as in my scenario with the money I save even with house prices rising in line with interest rates I'll still be able to get back on the ladder.

[WoWo]

As for the greed element, I don't think there's much wrong with trying to secure a safe financial future.

[darth vader]

I had considered this idea too. Unfortunately it is very risky and IMHO will not work. Many analysts are predicting that the Bank of England (now it's under governmental control) is getting it's sums right to stem the housing market inflation and that house prices will slow down and stop, though will not crash as in previous cases. Indeed the Independent reported today that house prices have stabilised in the south to the point of 0% inflation of prices, over the last 2 months, and that it is very unlikely the BofE will need to increase the base rate any further (remember it has been in past cases, the sharp increase in the base rate which has triggered house market crashes as people can no longer afford their mortgage and enter a selling frenzy/get repossessed)

[darth vader]

my html tags went a little wry there. I meant to say that now the Bank of England is not under governmental control