How do people afford houses in this day and age?

[tek-monkey]

We can but hope!

 

[Lucy]

There's no way I'd be able to buy now. I bought my house 2 and a half years ago, and despite earning almost 10k more now I don't believe I'd get a mortgage for the value I have. In hindsight if I was still on the same salary I'd probably be struggling; I only put down a 5 grand deposit and have a 35 year mortgage (although the interest rate crash mean I'm overpaying massively to cut this). I'm doing the house up slowly, still need a new kitchen etc., but I figure I can deal with that in a couple of years if I get a better job or payrise. I feel sorry for anyone who is trying to purchase at the moment, it seems impossible.

 

[db]

As said, I got the 40% load off the gov to use as the deposit. Actual capital? All negative!

ah right, so it is possible to buy a house with absolutely no capital behind you at all? that's good to know.. as i say, between us me and the missus have a few grand squirreled away, so it's nice to know we have options..

were you limited to location? cos i'm so chuffed with the area i'm in now i really can't see me ever wanting to live anywhere else lol..

There's no way I'd be able to buy now ... I feel sorry for anyone who is trying to purchase at the moment, it seems impossible.

to be honest, that's sort of what i wanted to hear.. as in, i wasn't sure if it was just me who felt like i had no chance of buying, with no prospect in sight.. from the responses in this thread, it sounds as if all new-buyers are in the same boat, so i might as well just forget about it lol..

 

[shoes]

Glad I'm not that only person who was wondering this. When I was living with my ex, we had a very comfortable income but the the options for buying a house were so limited at that point, we had no choice but to borrow 15k off of her parents and then take a mortgage which would have meant a pretty reserved social life, all to buy a terraced house on oxford gardens, which I would never do because my parents live on that street

Thankfully we never went for it, it would have probably made life fairly miserable. What kind of a mortgage can you get on 25k anyway? The flat above us on peter james court went for £122k (good old land registry ) which is almost five times £25k. This means no lender will even let you have a mint imperial from their desk, let alone enter into a serious discussion about home ownership with you. Maybe home ownership is reserved for the twee couples who are very careful with their money and have reasonable income between them.

In the meantime, house prices in south africa just keep going down so if you don't mind a few gun weilding insurgents keeping you on your toes, then thats an option

 

[shoes]

Its all here: http://www.ownhome.co.uk/servlet/Satellite?cid=1213946567253&pagename=CFScombi/Page/CFSCtplBlank

excellent, ta

tbh i think i'm barking up the wrong tree anyway.. the only reason i want in that house is because of the gorgeous, modern fitted kitchen, and the nice living room, etc.. the house i'm in at the moment looks like it was built by drunken one-eyed morons, but as i say i can't go about fixing anything because i don't own the place.. i guess, rather than plunging my heart and soul into saving for a house which i will inevitably have to throw money at in order to get it up to scratch anyway, i would be much better just looking to rent a better house that's got everything i need "out of the box"!

I'll send you some photos of my house, or you're more than welcome to come have a butchers' if you like, its fairly typical of the houses on the hill and i think you'll like it. The kitchen in particular, despite being a little small (9' x 9' or thereabouts) is fitted out beautifully. It's also on the doorstep for where you work too.

 

[John Marwood]

Forcast:

House prices to fall by 17 per cent in the years 2010 - 2011

Who will give me odds?

 

[tek-monkey]

Thats a pretty precise figure, what is your margin of error?

 

[John Marwood]

ten per cent?

to you

eight

 

[Lucy]

Glad I'm not that only person who was wondering this. When I was living with my ex, we had a very comfortable income but the the options for buying a house were so limited at that point, we had no choice but to borrow 15k off of her parents and then take a mortgage which would have meant a pretty reserved social life, all to buy a terraced house on oxford gardens, which I would never do because my parents live on that street

Thankfully we never went for it, it would have probably made life fairly miserable. What kind of a mortgage can you get on 25k anyway? The flat above us on peter james court went for £122k (good old land registry ) which is almost five times £25k. This means no lender will even let you have a mint imperial from their desk, let alone enter into a serious discussion about home ownership with you. Maybe home ownership is reserved for the twee couples who are very careful with their money and have reasonable income between them.

In the meantime, house prices in south africa just keep going down so if you don't mind a few gun weilding insurgents keeping you on your toes, then thats an option

I was offered up to 5 times my salary when I bought; but I think I'd only get 3 and a half times now, as long as I had a deposit.

 

[dylanf]

I dont think ill ever buy my own house unless I had the cash stashed away in my bank to buy it outrite.

The interest you pay on a mortgage is horrific.

According to the BBC, the average house price in the ST17 9Y.. area is £174,699

If I baught this house id need £17.500 as a deposit.

That leaves a mortgage of £157,199

At an interest rate of 4% over a 20 year mortgage id be paying £952.60 per month.

Over the 20 year period, id pay back £228,624 at 952.60 per month.
(http://www.moneymadeclear.fsa.gov.uk/tools.aspx?Tool=mortgage_calculator)

Thats £71 425 in interest alone.

Im currently paying £475.00 a month in rent. So in theory im saving £477.00 per month.

Now granted ive got my house cheap, but looking at rightmove I can get some nice house in Stafford for £700 per month. Thats still a saving of £300.00 oer month, plus I dont need to worry about all the added expense of owning a house.

If I chucked the £477.00 per month into the stock market, i bet I could make some serious returns. Much more than a property going up in price.

My two cents.

 

[Gramaisc]

The key word is 'currently'. When I bought mine I was paying £80 a month rent - and that seemed a lot at the time. What will your rent be in 25 years? You will indeed pay back more than you borrowed, but, then, you've had somebody else's money for 25 years. I would have liked to pay cash for it, but I would never have caught up.

 

[John Marwood]

An Economist writes.. ( Actually a bloke reading a copy of The Economist at Heathrow Airport drinking a glass of breakfast Rose )


"Twelve years ago a 3 bed modern style semi in a goodish road in Stafford was £63,000 while the average pay was around £18,000

That made it 3 and a bit times the annual income of one person

Today the average ( arithmetic mean ) salary is around £25,000 making a 3 bed modern style semi, proportionately priced at around £85,000

A similar property to the one purchased is advertised in the Newsletter at £164,950

Even if you can afford to buy a residential property this year it would be have serious risk of losing its value over the following decade"

Go to gate 111

 

[My Name is URL]

The interest you pay on a mortgage is horrific.

Like anything in life... you save up and buy outright or you take a mortgage and pay interest but get to live in the house in the meantime.

According to the BBC, the average house price in the ST17 9Y.. area is £174,699

If I baught this house id need £17.500 as a deposit.

I'm making a lot of assumptions here but if you have never owned a house before, IMHO you shouldn't be thinking about jumping straight into the "average house"........ (unless of course you can afford it but then you shouldn't complain about them being too much), you should be looking to start at the bottom and work up, not just jump into the "average house" You can pick up a 2 bed semi in Stafford for £80k and £100k..... deposit on these would work out £8 to £10.... not an unreasonable figure to expect people to save up IMHO.

At an interest rate of 4% over a 20 year mortgage id be paying £952.60 per month.

Might want to re-check that 4% figure.... And "normally" mortgages are taken over 25 years so would be better to use that too for comparative purposes.

Thats £71 425 in interest alone.

Overpaying can cut that figure in half easily..... obviously only if you can afford it, but just saying it doesn't have to be that much.

Im currently paying £475.00 a month in rent. So in theory im saving £477.00 per month.

Are you comparing like for like though... i.e. are you currently renting this "average £175,000 house? Plus you don't account for house price appreciation (although you did mention it), the fact that after 25 years you have somewhere to live rent free etc.

Hope this gives a different perspective on things.

 

[tek-monkey]

Needs a bit of work, but what about this:

http://www.rightmove.co.uk/property-for-sale/property-23795884.html?utm_content=ealertspropertyimage&utm_medium=email&utm_source=emailupdates&utm_campaign=emailupdates_jan09&utm_term=buying&onetime_FromEmail=true&sc_id=4313214

 

[cookie_monster]

Needs a bit of work, but what about this:

http://www.rightmove.co.uk/property-for-sale/property-23795884.html?utm_content=ealertspropertyimage&utm_medium=email&utm_source=emailupdates&utm_campaign=emailupdates_jan09&utm_term=buying&onetime_FromEmail=true&sc_id=4313214

my immediate thought was whats wrong with it at that price....and the answer is its non-mortgageable.

that would mean you would already have to have a massive amount of capital i.e. another house (so not for first time buyers) to put toward buying it. or very very nice relatives!


x

 

[dylanf]

Interesting article

http://www.everyinvestor.co.uk/property/property-investment/is-renting-your-home-better-than-buying-

 

[Gramaisc]

Does 'Non Mortgage Able' mean non-mortgageable? i.e., cash only?

 

[My Name is URL]

Wonder why its non-mortgageable?

 

[dylanf]

It means the banks are not willing to underwrite a mortgage secured on this property.

This could be several factors. I had it happen to me when I tried to buy a flat several years ago.

The banks said that in princaple I could take out a mortgage on the property, but after the property survey the banks said "Computer Says No"

There was something fundamentaly up with the property I was trying to buy.

 

[Gramaisc]

There were a couple of 'abandoned' houses on Park Avenue. They were on the other side from where their map shows this to be, but there may be potential for an ownership dispute.