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  1. #31

    CPLTD's Avatar
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    Quote Originally Posted by AMLightfoot View Post
    Funnily enough this is spot on - It sounds counterintuitive but it's true! I have always prided myself on never being in debt. Never had a loan, paid my credit card bill on time. LeBoyfriend has a long string of car and motorbike loans in his past and now another fresh one for his current car, plenty of overdraft action and credit cards and the mortgage broker said to us that he was concerned about my rating! Luckily I came in just inside the threshold (*Phew*).



    I both agree and disagree here. Owning your own property isn't just about 'achievement' - it is also about security. When landlords encourage obnoxious neighbours to force their tennants to break contract (I read something shocking about a landlord that made a habit of doing this in order to make a profit) and where renting a property is so costly, owning is sometimes the CHEAPER option. It is also nice to know that you aren't going to get home and find an 'I'm selling the house, you have 3 weeks to move' letter on the door mat (I've lost count of the number of friends that have had this done to them). I don't need that sort of uncertainty and stress in my life. I also want to be able to do what I like, how I like in my own home. If I accidently put a hole in the wall LeBoyfriend and I giggle about it, sort out a fix and get on with it. Or live with it. In the case of our house: Old 1950's houses have a tendancy to have rubbish upstairs interior walls and a previous owner decided it was easier to dot-and-dab stick thin plasterboard everywhere than to fix or level them off but the 'dot-and-dab' is too thick creating 'danger zones' in the walls where an accidental impact can leave a large hole that needs filling and plastering over...

    That being said, home ownership is not for the fiscally irresponsible. My grandfather always says that a roof over your head is more important than anything else. You can live without Sky, you can live without the internet and you can get a pay-as-you-go SIM card - but to have your own roof over your head is a security like no other. But if you are frivilous with money renting is the best option as owning a home is a huge responsibility and commitment on your finances. You also cannot move as easily if you hate your neighbours - at least if you rent and your neighbours are a nightmare you can report them to the landlord and then start looking. It's just a lot of upheaval.

    Also, why SHOULDN'T we own our own homes? Why should we work hard to line the pockets of some greedy grasping property-hogging landlord? We work hard for our money and why shouldn't we reach the end of 30 years of paying £800 a month with something to show for it? When you rent you have nothing to show for it. No equity to fall back on in your twilight years.

    Lets look at this in a mercenary way. When I get to the end of my 30 year mortgage term, I will have a 3 bedroom semi-detached house (or better, depending on if we move, but for the purposes of this illustration let us assume I don't). I will OWN this house outright, so whatever it is worth (regardless of whether that is more or less than what I paid for it in relative terms) is MINE. If I need nursing care in my dottage or need to downsize to a smaller place, I can sell my big old family home and use that equity to support myself. When a renter has worked 30 years and paid out the same or MORE than I paid for my mortgage, what do they have to show for it? Do they have any savings? Investments? All things being equal, let us assume that me and renter are in the same situation. We don't earn enough to have sufficient disposable income to properly save and invest. But in my case, my payments ARE investments - I get to own a house. What does renter have? Nothing. Nothing to show for that big ol' chunk of money paid out every month. THAT is why there is so much 'drive' to own a house. Not because of 'achievement' or some other obnoxious reason, but because ultimately, mortgages and rents are more or less equal, except if you're paying a mortgage you at least get some of that back in equity. Renters get nothing but a cheeful F-off you old fart - can't pay the rent, can't live here.

    Fiscal responsibility - Didn't you say your parents laid down the deposit for you?

    My view and choice have nothing to do with fiscal responsibility or lack of it - just personal preference and living my life. I can do the same as you after 30 years and have all of my care paid for - which let's face it is what we all would do rather than having to pay for it ourselves. I won't have to hide the money from my house or donate it to my children. The only difference being I wouldn't have worked my whole life, to in effect hand to over to my children for them to get on the ladder. Security as you call it is double edged to me. It revolves around your job/career and if you lost your job, how long can you realistically keep up your mortgage repayments before your house is repossessed. Then how much security do you have and what have you gained.

    As I said when it comes to it I will of course get on the ladder, but it will not be an over exertion and I won't put myself in potential trouble because it is the "secure" responsible option!


    Chris

  2. #32

    dhicks's Avatar
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    Quote Originally Posted by cpjitservices View Post
    Shame I cant find him and try to do a deal.
    This is the kind of thing a decent private detective should be able to handle for you - an investement of a couple of hundred pounds should secure you some contact details.

  3. #33

    nephilim's Avatar
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    The mrs and I could never afford our own property...the deposit alone was enough to make it vastly difficult for us...so the Mrs uncle bought the house we wanted...we "rent" it from him, effectively paying the mortgage and a bit extra for his services, and he does the whole landlord bit for us if needed (only ever asked for a new boiler, the rest we did ourselves). Could be a good way to get a house - get someone else to buy and you draw up a contract where you pay back the mortgage payments etc and you own the house when it is paid off. We are 4 years in, so nearly 1/5 of the way

    He bought it as a "buy to let" property, and at the end of the term, we will own the house as per the contract drawn up
    Last edited by nephilim; 24th July 2012 at 07:11 PM. Reason: added an additional line

  4. #34

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    Quote Originally Posted by nephilim View Post
    The mrs and I could never afford our own property...the deposit alone was enough to make it vastly difficult for us...so the Mrs uncle bought the house we wanted...we "rent" it from him, effectively paying the mortgage and a bit extra for his services, and he does the whole landlord bit for us if needed (only ever asked for a new boiler, the rest we did ourselves). Could be a good way to get a house - get someone else to buy and you draw up a contract where you pay back the mortgage payments etc and you own the house when it is paid off. We are 4 years in, so nearly 1/5 of the way

    He bought it as a "buy to let" property, and at the end of the term, we will own the house as per the contract drawn up
    this government and the last thought along similar lines, and came up with shared equity. Heard so many stories of people who could never extend beyond owning a small portion of the equity, and they just seem to end up paying through the nose without ever owning outright. Sounds like purgatory to me.

    The majority of houses for occupation in this country were built during the inter-war years. That's a relatively recent surge of housebuilding that we're unlikely to ever see again despite the resources at the disposal of the government. Not that it really matters to most people as they want to live in prime locations near to good schools, shops and transport. In built up areas redevelopment opportunities for family housing are few and far between even if there was an interest in building.

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  6. #35

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    I'd never recommend anyone shared equity. You actually end up paying for a property several times over. For example (for those unsure) a house that's worth £100K with a shared equity of 50%.

    You get a mortgage for 50% (£50K) and you pay the housing association x amount per month. Two mortgages in a way. After a year or two, you may be given the option to buy 10% of the shared equity (totalling 60%), but that 10% would have been paid by yourself several times already.

    Basically if my maths are right, you could end up paying £250K + for a house that's only worth £100K and even worse, you won't ever be able to own 100% of it.

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  8. #36

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    See we don't pay anyone else but the Mrs uncle. We effectively own 1/6.25 of the house we live in. Next year it will be 1/5...and continue accruing until we own it all. As soon as the mortgage is paid, its ours

  9. #37


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    Have you been to a mortgage advisor? They tend to have access to deals you don't or might not find on your own.

    I bought my house almost 1 year ago with a 15% deposit. Although I had been in the same job for 6 years I don't believe they required 3 years, they only asked for 3 months pay slips.

    My advice is take what you can now and grin and bare it for a couple of years, by which time you should be in positive equity, mortgages will be easier to get anyway, and hopefully you will have saved a few bob extra as well giving you a decent deposit for a decent house.

    You'll not get a Mortgage for a property that needs renovation (short version).
    Agreed. They will put a retention on it which basically means you might spot a house which needs 10k spent on it to make it livable. The bank will then want a "deposit" of at least £10k (probably double) to cover the work they would need to carry out to sell it should you not pay the mortgage. Add that £10-20k to your original deposit and you now own a house. Ok great you can now work away on the house and make it livable in your own time, right? Wrong. You will have around 6 months (iirc) to carry out the work which obviously means you need the £10k sat in your bank as well as your retention and as well as your deposit... as well as your solicitors fees, checks, etc... and then after all that you will need the money to furnish and decorate.

    Basically if you find a wrecker house for £50k you will need at least £35k sat in your bank to stand a chance of buying it.


    Have you looked at auctions? You can get some bargains and it's not actually as daunting as it initially seems.

    Good luck
    Last edited by j17sparky; 24th July 2012 at 08:57 PM.

  10. #38
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    Quote Originally Posted by AMLightfoot View Post
    Funnily enough this is spot on - It sounds counterintuitive but it's true! I have always prided myself on never being in debt. Never had a loan, paid my credit card bill on time. LeBoyfriend has a long string of car and motorbike loans in his past and now another fresh one for his current car, plenty of overdraft action and credit cards and the mortgage broker said to us that he was concerned about my rating! Luckily I came in just inside the threshold (*Phew*).


    I both agree and disagree here. Owning your own property isn't just about 'achievement' - it is also about security. When landlords encourage obnoxious neighbours to force their tennants to break contract (I read something shocking about a landlord that made a habit of doing this in order to make a profit) and where renting a property is so costly, owning is sometimes the CHEAPER option. It is also nice to know that you aren't going to get home and find an 'I'm selling the house, you have 3 weeks to move' letter on the door mat (I've lost count of the number of friends that have had this done to them). I don't need that sort of uncertainty and stress in my life. I also want to be able to do what I like, how I like in my own home. If I accidently put a hole in the wall LeBoyfriend and I giggle about it, sort out a fix and get on with it. Or live with it. In the case of our house: Old 1950's houses have a tendancy to have rubbish upstairs interior walls and a previous owner decided it was easier to dot-and-dab stick thin plasterboard everywhere than to fix or level them off but the 'dot-and-dab' is too thick creating 'danger zones' in the walls where an accidental impact can leave a large hole that needs filling and plastering over...

    That being said, home ownership is not for the fiscally irresponsible. My grandfather always says that a roof over your head is more important than anything else. You can live without Sky, you can live without the internet and you can get a pay-as-you-go SIM card - but to have your own roof over your head is a security like no other. But if you are frivilous with money renting is the best option as owning a home is a huge responsibility and commitment on your finances. You also cannot move as easily if you hate your neighbours - at least if you rent and your neighbours are a nightmare you can report them to the landlord and then start looking. It's just a lot of upheaval.

    Also, why SHOULDN'T we own our own homes? Why should we work hard to line the pockets of some greedy grasping property-hogging landlord? We work hard for our money and why shouldn't we reach the end of 30 years of paying £800 a month with something to show for it? When you rent you have nothing to show for it. No equity to fall back on in your twilight years.

    Lets look at this in a mercenary way. When I get to the end of my 30 year mortgage term, I will have a 3 bedroom semi-detached house (or better, depending on if we move, but for the purposes of this illustration let us assume I don't). I will OWN this house outright, so whatever it is worth (regardless of whether that is more or less than what I paid for it in relative terms) is MINE. If I need nursing care in my dottage or need to downsize to a smaller place, I can sell my big old family home and use that equity to support myself. When a renter has worked 30 years and paid out the same or MORE than I paid for my mortgage, what do they have to show for it? Do they have any savings? Investments? All things being equal, let us assume that me and renter are in the same situation. We don't earn enough to have sufficient disposable income to properly save and invest. But in my case, my payments ARE investments - I get to own a house. What does renter have? Nothing. Nothing to show for that big ol' chunk of money paid out every month. THAT is why there is so much 'drive' to own a house. Not because of 'achievement' or some other obnoxious reason, but because ultimately, mortgages and rents are more or less equal, except if you're paying a mortgage you at least get some of that back in equity. Renters get nothing but a cheeful F-off you old fart - can't pay the rent, can't live here.
    I couldnt AGREE MORE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! !!!!!!!!!!!!!!!!!!

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  12. #39

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    Being fortunate enough to be at the other end of the cycle from you guys - I can't recommend buying your own property enough - I've paid off the mortgage and now we can survive on a single wage without all the worry. Its a weight off your shoulders and a boot off your neck - we can give "the finger" to "the man" and not have to dance to his tune anymore. Yes we were fortunate that house prices were a lot lower when we started out - but conversely interest rates have been a LOT higher - 17% really made my eyes water and made the repayments quite a bit bigger than one of our salaries, which made being redundant quite stressful, though I agree with the post that reckoned prices are to high and interest rates will rise...though I've been thinking that for several years and it hasn't happened yet - I'm not sure the govt can take the pain that would be caused by mass repossessions as happened 20 years ago, but we'll see. At least you're in a cheap part of the country - or you could just take over the house across the road and squat and save your money...

  13. #40

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    If you see yourself moving well up the ladder of earnings, then investing in a house has (in the past) been a reasonable plan as a basic savings vehicle and of course you get to have a lot of control over your living arrangements.

    And of course it fulfills the human nesting instinct that a lot of people have.

    But renting is by no means (and quite possibly the most sensible) a daft option if you just see your self trundling through life, enjoying it where you can.

    its always been the way, that if you want a house, its going to cost you a lot to get on the ladder and a lot (compared to income) during the first 10 years. Most people have familys during this time and if your income is not increasing beyound inflation and/or interest rates then a lot of pain can follow.

    Educational IT support is not renowned for its progression and good salaries

    Good Luck

    Simon
    PS I married someone who already had a house so I was lucky

  14. #41

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    Quote Originally Posted by SpuffMonkey View Post
    Being fortunate enough to be at the other end of the cycle from you guys - I can't recommend buying your own property enough - I've paid off the mortgage and now we can survive on a single wage without all the worry. Its a weight off your shoulders and a boot off your neck - we can give "the finger" to "the man" and not have to dance to his tune anymore. Yes we were fortunate that house prices were a lot lower when we started out - but conversely interest rates have been a LOT higher - 17% really made my eyes water and made the repayments quite a bit bigger than one of our salaries, which made being redundant quite stressful, though I agree with the post that reckoned prices are to high and interest rates will rise...though I've been thinking that for several years and it hasn't happened yet - I'm not sure the govt can take the pain that would be caused by mass repossessions as happened 20 years ago, but we'll see. At least you're in a cheap part of the country - or you could just take over the house across the road and squat and save your money...
    imho the mass repossessions thing won't be happening again. Neither will high interest rates. plus i can't see the cycle of house price boom - then bust - repeating itself. A lot of people were fortunate to be able to trade up or move back into rental (the STR's) with a massive amount of cash because of short bursts of massive house price increases through part of the eighties, the late 90's and early 2000's. If, as i'm starting to believe we are, in a period where prices don't fluctuate much at all because we're in a semi-permanent 0% interest-rate economy - then it'll be that people stay put where they are for longer. trading up is a lot easier if you get the benefits of big house price inflation every 4 or 5 years of owning, if that's no longer a guarantee then instead you'd have to be a good earner, and be in a position to be big savers or mortgage overpayers. Otherwise your stuck and your one less property coming on the market, and the only consolation is low repayments because of rates kicking around at .5%.

  15. #42

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    I don't think .5% is going to last. While I agree we're unlikely to the heady heights of 17% again, 1% buy christmas is likely. Within the next 5-10 years I think we'll see 5-6% again. The question is when and how fast?

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    I bought a house with my other half about 3 years ago (so during the recession) with a 10% mortgage and no money lent from our parents.

    However, we have a distinct advantage compared to a lot of people in this thread, both working and no children. Now I don't know exactly how much children cost, but I am imaging they cost enough to make saving for a deposit difficult.

    As for getting a renovation project, we did. Don't worry about what people say about mortgage not touching them, a mortgage company never sees the place, a surveyor does. I got a house that was on the market for 100k for 85k, as long as the surveyor thinks it is worth what you are offering then a mortgage company doesn't care.

    Don't be disheartened by people telling you how hard it is to get on the property ladder, you got to do the leg work yourself sometimes to. My other half was a postgraduate student (with a tax free stipend for research), all mortgage brokers told us no one would recognise that income so they wouldn't lend us money. I didn't believe no one would and got a mortgage directly myself, with my first question as I rung round places being regarding this income. It was probably a lot more effort then using an adviser but I am better for it. I know exactly what is going on etc.

    Also remember buying a house is for the long term and can take months anyway. You need to speak to a company and work out what they would lend you if you had a 10% deposit, then your problem is finding a house and getting the deposit together, you don't need to provide proof of deposit till you are actually getting the money from the mortgage company. Then obviously you need the money when you are asked to transfer it.

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  18. #44
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    I took out a mortgage in 2000 and to be honest I'm glad I got out of it. I didn't like the idea of being tied down, or the hassle of selling and buying again, and the whole chain.

    It's nice to own your own house (but isn't it the bank's until you pay it off?) but there's the associated repairs and upkeep. And what happens when you die? It gets sold and then your kids argue over who gets what percentage which they'll probably blow on a car or holiday. Is it really worth all that effort?

    I much prefer my philosophy of renting and then moving on when I get bored of an area, not have to worry about repairs and just enjoy my life.

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  20. #45

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    Quote Originally Posted by CPLTD View Post
    Fiscal responsibility - Didn't you say your parents laid down the deposit for you?
    So you're saying that just because I didn't have £15,000 lying around at the age of 24 that I am fiscally irresponsible? Seriously? Do me a favour! A person can be responsible with their money but still not be in a position to save. I left university at the age of 21 - up until that point I'd only had a weekend/part time job - certainly not a salary. It was only enough to keep me going at University, run my car and buy my textbooks. However I left university with minimal student debt - my student loan is very nearly paid off. Does that sound like someone financially irresponsible to you? When I left university I (like thousands of others) struggled to find a job, so rather than sit on my ar$e and claim off the social, I took a minimum wage job. This was barely enough to live on but it was enough to cover my various outgoings. Not enough to save though. But still, I was responsible, didn't get into debt, didn't buy things I couldn't afford or go on holidays I couldn't afford (backpacking in the aolian islands was hardly luxury 5*). I'm still struggling to see how I could have saved £15,000 though. So having worked this minimum wage job and stuggling to get a job without practical experience, I took another job opportunity with a MINOR salary increase. I was now only slightly above minimum wage. I did this job for a year before I was MADE REDUNDANT. Yeah, I sound really fiscally irresponsible right now. So instead of moping about on the social or going back to a min wage role, I took the oppotunity to do my PGCE. This was grant funded but not salaried. So how am I supposed to be saving my £15,000 CPLTD? The grant barely covered living expenses. It was only when I moved into IT that I started earning anything approaching a reasonable salary. At this point I started saving what I could (once living and travelling expenses were taken into account), but my first IT job still wasn't brilliantly paid. So far I am a LOOOOOOOOOOOOOONG way off my £15,000 and I am 25 at this point and LeBoyfriend and I had only just met and were in no way ready to move in together.

    There are a LOT of costs associated with buying a house. What makes you think that just because our parents helped us with the deposit that we didn't plough our savings into the other costs - the solicitors fees, the furniture, the survey, etc? These little costs eat money really quickly.

    I find your comment offensive, actually. Suggesting that we are irresponsible with money simply because we needed help with the deposit. There is a HUGE difference between needing help with the deposit and being fiscally irresponsible. An irresponsible person is a person who fritters their money away on pointless things, expensive holidays they can't afford, running up credit card bills, living beyond their means. A Responsible person is a person that lives within their means and saves for their luxuries and only has what they can afford. We couldn't afford to have a holiday AT ALL this year, so we didn't. We've been saving specially and can afford a week in Andorra in January. This doesn't make us irresponsible. If I was constantly crying to Mum and Dad whinging about not having any money and asking for handouts, I'd say I was irresponsible. But we don't. We live within our means and have a modest amount left after all the bills are paid to invest in the house (there is a lot of work to do and we'd rather do the house up and increase our equity share than 'save' it) and to save for a little holiday.

    I'm quite angry now. I assume that was your intention with your offensive little jibe.



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