Should buy a house or save?

[damien]

Hello,
im a bit new to all this. I know how much prices have gone up in the last few years. I inherited ?20k 3 years ago, and because im living with my mother, i can afford to save ?500 a month (earning 5% interest). The ?20k is also earning 5% interest. I was thinking about buying a house/flat 3 years ago. My question is: taking my financial situation into account, would i have been better off buying that house/flat 3 years ago (in which case ill be forever kicking myself!). and another big question:- will it be better off in 5 years time if i buy a house now and lose all my savings and interest earned and monthly savings and the interest earned on that?
Cheers
Damien

[daniel]

Hi Damien,
You would have been better off buying back then, but so what that was then and this is now. I would buy a one bed flat so that I was on the property ladder but not stretched too much financially. If she will put up with you, you could even rent it out and still live with mum. That way the rent cover the mortgage you just have to be prepared to cover ?voids? (gaps where you have no tenant and therefore no rent). If you move into yourself later on you will not have pay Capital Gains Tax because it will be your one and only property (your home) BUT you would have to pay income tax on the rent.
Keep in touch
Daniel