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notabikeranym... |
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notabikeranym... World Chat Champion
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bhinso |
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bhinso World Chat Champion
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Posted: 22:25 - 08 Nov 2020 Post subject: |
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My experience is there's never a bad time to buy a house so definitely make it a plan.
Save everything you can. The deposit is the key thing. I think you could get something like 80% loan to value so 50k would be good for a deposit, but the mortgage rates would be relatively high.
Having said that I can't see the interest rates rising by much if anything over the next 5 years.
As for savings accounts, your guess is as good as mine. I got 32p interest from Nationwide this month |
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MarJay |
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MarJay But it's British!
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piazza |
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piazza Brolly Dolly
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Riejufixing |
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Riejufixing World Chat Champion
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Posted: 23:48 - 08 Nov 2020 Post subject: Re: Money/first house question. Is it too late/how do I do t |
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Be careful if you want to change jobs. Make sure you are onto as safe a bet as possible.
Are there any opportunities for advancement with your current employer?
Can you live cheaper? What is the cheapest house within not-too-costly in terms of time and money commute to your current work?
Don't forget that lenders are currently covering themselves by asking larger deposits. They foresee a likely price drop, C. 10%. My guess is from March next year. That is not certain, but they are talking action.
Don't keep your money in a low-interest savings account. Use a low-cost investment vehicle such as an investment trust, the wider the range of its assets the better. Specialist trusts may gain or lose more, you want some sort of average. F&C Investment Trust (BMO) has a reasonable history. Save as much as you can in ISAs.
If there's a sudden drop in share prices, invest more than when they're high. A regular monthly saving into shares such as in the above takes advantage of pound cost averaging, but if you have spare cash to drop in from time to time, so much the better.
Do not be tempted to sell your shares to spend on wasting assets such as new vehicles.
Edit: "So far I've got £15k to my name which is fuck all in the grand scheme of things"? I'd call that not doing too badly, and a decent start. |
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P. |
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P. Red Rocket
Joined: 14 Feb 2008 Karma :
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Posted: 00:24 - 09 Nov 2020 Post subject: |
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I'm literally moving away because it's cheaper. I'm keeping my current job and comfortably moving to a house that's around 100k for a 3/4 bed near the sea, rather than 250k+ for a 2 bed in a rank area, that saving means more to me than anything else
15k isn't a lot in all fairness. It's a good chunk, but if you intend to stay down south, I'd want triple that. |
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Robby |
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Robby Dirty Old Man
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stinkwheel |
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stinkwheel Bovine Proctologist
Joined: 12 Jul 2004 Karma :
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Posted: 01:26 - 09 Nov 2020 Post subject: |
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You need to decide between what you want and what you can afford. Seems like the two circles on your venn diagram do not overlap currently.
Most first time buyers don't get the house they want. You've heard the phrase "property ladder", you're looking at the bottom rung. Can't climb a ladder without stepping on it.
Get one you can stand living in, can afford and isn't fucked (or fucked over by leasehold agreements), pay as much into the mortgage as you can reasonably afford. When circumstances change, all that can be rolled over into the next property, plus appreciation on the property, less inflation on the capital. ____________________ “Rule one: Always stick around for one more drink. That's when things happen. That's when you find out everything you want to know.”
I did the 2010 Round Britain Rally on my 350 Bullet. 89 landmarks, 3 months, 9,500 miles. |
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wr6133 |
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wr6133 World Chat Champion
Joined: 31 Dec 2013 Karma :
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Posted: 08:47 - 09 Nov 2020 Post subject: |
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If you plan to save for a few years then you have time to possibly locate an area out of London you like and if not wanting to commute then a decent job.
If you do plan to commute I believe Marjay does Basingstoke to central London and I know people as far away as Tidworth where I live who drive 8 miles to Andover station and are in Waterloo in a bit over an hour (I think this is too long commuting but for some it's ok). My nextdoor neighbour drives to Hounslow every morning
For an idea of what biting the bullet and commuting that far gets you, in London even further out than your current I'm guessing 250k is a flat, Leasehold? Here a bit under that got me a 3 bed end terrace house, driveway, garage, small garden and views toward Salisbury Plain, Freehold. Basically the further you can get from London the more rungs up the ladder you can start.
Don't over stretch. We had a large deposit and could have mortgaged something pretty huge, we didn't we chose something that easily meets our needs and was affordable on a 10 year fixed mortgage. Many of my friends take the opposite track and have bought bigger with small deposits on 90% mortgages for 25 years, I personally don't see this as wise. Monthly payments absorb most of their income so they are stuck for 25 years toiling for more house than they need, comparatively my monthlies are small enough to pay on a part time minimum wage job if I wanted to but in the main I know once I'm paid off I no longer need to be grinding at work to maximise my income. I plan to be working a 4 day week by 40.
TLDR, get the fuck out of London, don't over reach and pay off as fast as you can. |
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arry |
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arry Super Spammer
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Polarbear |
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Polarbear Super Spammer
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rpsmith79 |
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rpsmith79 World Chat Champion
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GSTEEL32 |
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GSTEEL32 Traffic Copper
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Posted: 11:04 - 09 Nov 2020 Post subject: |
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Be careful about for forward planning for a house worth "X", in your case 250k.
Houses, like any commodity, are subject to price moves for a variety of factors. What may be 250k house now, may very well not be in 5 years time.
Milton Keynes, Northampton, Corby, Peterborough have seen some areas increase by 30 - 40% in 5 years. Other area's, such as Newcastle have pretty much flat-lined since 2010.
I appreciate you're saving £1,000 a month now, which is very commendable, but you may find that this number is being dwarfed by the increase in house prices on a monthly basis. You may also find you are unable to save this over a 5 year period consistently (there are many reasons why this may by the case).
Case in point, we moved to Essex in 2013. Sold in 2015. The house (and to be clear, we did nothing more than revamp the bathroom) did 40%. There is absolutely no way I could have saved that money a month, as well as paying rent.
People have been warning of a price crash for years, the fact remains, so long as the population increases at a rate which is not being met by new build houses, the price of the commodity will rise.
Factor in that people are living longer, so can be offered more finance over a longer term (making repayments seem more "affordable"), and people will continue to be comfortable borrowing more outright "notional" value. Interest rates (defacto "inflation" under the Keynes economic model, however low) still erode the value of money over time.
My worry, long term, is that houses will become like car finance and be offered on a "PCP" type basis. This way, instead of effectively paying off the car depreciation over 4 years, you effectively buy into the expectation that you will have a house that is worth more after 4 years than the money you put in. You'll never ultimately own the home, but you'll be inclined to live in places that you think have the best opportunity for growth, which you will then "bank" at the end of the 4 year term. You then use any residual as a "deposit" for another PCP type agreement.
It will make "rent" feel like ownership, even though the bank ultimately hold the deeds. The bank would price the "rent" at a number which also buys them insurance against a default. Stamp duty on PCP deals would be scrapped as the government coffers will be swelled by all the additional activity in the financial services market.
Ironically, this will increase house exchanges dramatically, naturally driving up the prices, It would be a self fulfilling prophesy, but a financial time-bomb long term.
Apols - Tangent. TLDR - I agree with everyone, buy now, lock yourself in to current price levels. |
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iooi |
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iooi Super Spammer
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A100man |
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A100man World Chat Champion
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Diggs |
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Diggs World Chat Champion
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Posted: 15:37 - 09 Nov 2020 Post subject: |
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Move up north. You can still get a 3 bed terraced house for less than 100k in an area that isn't the wild west if you are canny.
If you need to work elsewhere at any point, give it to a letting agent so you don't have to worry about tenants etc. ____________________ Now - Speed Triple, old ratty GS550, GSXR750M
Gone (in order of ownership) - Raleigh Runabout, AP50, KH125, GP125, KH250, CBX550, Z400, CB750FII, 250LC, GS550, ZXR750H1, Guzzi Targa, GSX750F, KH250 x2, Bimota SB6R and counting... |
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TaffyTDM |
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TaffyTDM Spanner Monkey
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Posted: 17:36 - 09 Nov 2020 Post subject: |
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Prices can fall as much as rise, so dont buy the "property is foolproof" mantra.
That being said the sooner you start, the closer you are to paying it off. So theres a balance to be struck - if you can find a place that isnt your forever home, but is somewhere you wouldnt mind getting stuck in for a while theres a blip in the future then go for it, start overpaying the mortgage rather than trying to rent and save a larger deposit at the same time. If its a place that would be attractive to renters all the better, if your life suddenly changes quicker than rightmove can keep up, its another option to keep things ticking.
And if prices do crash, as long as you arent in negative equity you wont necessarily be worse off, in fact you may be better if the next place is now in reach and you are paying less in commision and SDLT as a percentage
There are benefits to renting, but increasingly they arent worth to me the hassle of dealing with turd landlords and the lack of personal control.
Be careful of leaseholds, especially in larger blocks of flats, check the ground rent and maintenance arrangements. Personally i always preferred a small cottage etc for the freehold element if nothing else.
If you do go for it sooner, i would lock in the rate as long as you can and overpay like fuck! |
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struan80 |
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struan80 World Chat Champion
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Nobby the Bastard |
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Nobby the Bastard Harley Gaydar
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Robby |
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Robby Dirty Old Man
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bhinso |
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bhinso World Chat Champion
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Keithy |
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Keithy Spanner Monkey
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winz |
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winz World Chat Champion
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Posted: 12:15 - 10 Nov 2020 Post subject: Re: Money/first house question. Is it too late/how do I do t |
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Meef wrote: | 1. Want to buy my first house at 32 (five years from now). - Is this possible? |
Hell yes, I bought at 32 by myself.
Meef wrote: |
2. Currently renting, can comfortably save around £15k/year living frugally. Aim to have close to 90k to my name in 2025.
3. Earning £33k gross per year in a stable 9-5 at the moment, probably won't change.
4. Have 'excellent' credit according to multiple credit checkers.
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Good on ya, especially during these times where certain industries are fucked.
Meef wrote: |
5. Doing this on my own. No joint mortgage or anything like that.
Affordability calculators say I can borrow up to £150k based on my salary. Kinda want to get a house in the region of £250k. Is this realistic?
I've tried to do my homework on this but it seems I need to save up £100k to stick towards the house if it's gonna be a £250k house. |
Got to think about stamp duty, solicitor fees, searches etc too. These soon add up.
Meef wrote: | Everything under £250k between 40-50 miles of my work is a one bedroom flat, so I'd probably have to move further out if I want to get more for my money but that might be a problem unless I can blag remote working or find a new job (which comes with all types of fucking risk).
What would you do if you were me? What would you do with the savings? I've stuck it in some e-saver with a shit interest rate because I don't know any better.
I never had any guidance with this shit and never took it upon myself to learn, so any advice is greatly appreciated. Apologies in advance if I seem utterly clueless lol. |
I'd say get on the ladder as soon as you can. I bought a 2 bed flat in a part of Bristol which isn't that desirable (but certainly an up and coming place being closer to the centre and the 'cool' bars and restaurants that were opening'. Owned it for 2 years (had a 2 year fixed mortgage) and made 10% on it while overpaying the mortgage.
From having a £18k deposit I now had that plus the equity that I built up this allowed me and my parter who sold her flat in a more affluent area to buy our house.
Now I get that Bristol isn't as inflated as London, but as mentioned by someone else, times are changing in the city and remote working is becoming a lot more popular, so being further out might not be a bad thing and you can get a lot more bang for your buck. I guess it depends on what you do for work. ____________________ Current Bikes: BMW K1200S
Previous: Honda CBR929RR, Honda CBR1100XX, Honda CB600F |
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Riejufixing |
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Riejufixing World Chat Champion
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Old Thread Alert!
The last post was made 3 years, 165 days ago. Instead of replying here, would creating a new thread be more useful? |
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