Alexander

Mortgage protection insurance is not a legal requirement. However if you are taking out a mortgage to buy a property, your lender may ask you to have this insurance. This is to protect them against the possibility of you losing your income and defaulting on your payments. You do not have to take out the mortgage offered by your mortgage lender though, so shop around for the best deal.

From a monetary point of view it is almost certainly much cheaper to buy a house than to rent. After all despite taking on a frightening amount of mortgage borrowing you should eventually pay it all off and be left with a real tangible property which you own outright. Historically it should also be worth (far) more than you paid to buy it. By contrast if you choose to rent you will never own your property and thus will have to rent until the day you die! A number of surveys have shown exactly how much more you will pay to rent over your lifetime than to have bought!

Even if your circumstances change and you end up not being able to pay all of your mortgage off you should still, hopefully, find that you have at least some equity built up over time to show for your mortgage payments.

There are of course other factors at play such as job mobility and maintenance costs which favour renting compared to the security of ownership and freedom to decorate as you like which favour buying. In my experience it is also often cheaper to buy via a mortgage than to rent the same property - in other words you may well find you are paying less every month to buy than to rent the same place - certainly as time ticks by this will be the case. Think about it. If you have reduced your mortgage to £50,000 on a £200,000 house the monthly repayments will be far less than renting a similar sized property. Indeed as a professional adviser I have often found that people pay less for their mortgages than they receive back in rent.

Finally not only will you be renting for life but those rents will rise (every) year - perhaps as your ability to meet ever rising rental costs reduces especially once you retire. Meanwhile those who have bought have typically paid off their mortgages by the time that they retire and so face reduced living costs compared to those who must still pay rent.

If this is an investment question then matters may be different. Renting avoids maintenance costs, estate agent and lender fees, letting fees and gas safety inspection costs etc and leaves capital free to invest elsewhere where it might perform better. Certainly, as we should all be very well aware after recent events, property can (and does) fall in value as well as rise. You should therefore not mix up buying as a home to live in with investment. However you may be lucky and enjoy both!

This is a huge question, so I can only note down a few pointers.

If asked, ''what is my house worth?" there is only one answer: "it is worth what someone is prepared to pay for it." In other words, like most investments, its worth depends upon sentiment seasoned with other influences.

If people are confident about the economy, house rises will rise (it is a feedback loop - conversely, if house prices rise, people become confident about the economy). With current economic insecurity, we have seen house prices fall, of course.

Affordability is another issue, with mortgages dependent upon income. The more money available to buy properties, and the lower the rates, the freer are people to obtain loans. A major effect of this is to increase the cost of the house they would have bought anyway, with a marginal possibility that they could buy a better (as opposed to more expensive) property.

An influence here is earnings. Earnings tend to rise a little faster than inflation, so progressively more money comes available to fund house purchases - hence house prices will also tend to rise.

Locally there will be other influences on house price movements, such as unemployment levels, the influx or otherwise of new industries, the catchment area of a school with a good reputation, regeneration plans or proposed new wind farms or recycling centres, for instance. The quality of the immediate neighbourhood is critically important.

Finally, consider that it is impossible, mathematically, for house prices to rise indefinitely, as it is also impossible for indefinite growth of any investment. If they could, then the value of those investments or house prices would tend towards infinity.