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General Chat Thread, Owning your own home..... in General; Originally Posted by crc-ict No doubt CPLTD will be along a minute to call me financially irresponsible too, I only ...
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    Quote Originally Posted by crc-ict View Post
    No doubt CPLTD will be along a minute to call me financially irresponsible too, I only wish I had any other choice.
    Call you irresponsible? Ha ha thanks - no not at all. Not too sure what you are getting at there tbh?

    Chris

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    Quote Originally Posted by localzuk View Post
    Not quite. Our parents managed it by saving, sure, but the amount they needed to save was significantly smaller. My parents got a mortgage that was 3x the size of my dad's salary (single earner), and they were lucky as my mom had some money from an inheritance for the deposit. Now, the amount available is basically 5x salary maximum and that will not get most people a house.

    Just look at the price increases shown above by chazzy - £32k to £142k in less than a decade. Inflation hasn't increased that much, nor have wages.

    Also, £120k for a 3 bed place? Wow. Where I'm about to move to, a large 3 bed place will set you back a large £200k+... Anything less and you're buying a shoebox. A 1 bed flat is £80k+...

    I can see that it is more now, but the principle is still the same - they saved over 3 years, as oppose to 5 but they still saved! 3 x your salary is still a fair old task no? Well it is for me anyway.


    Chris

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    Quote Originally Posted by CPLTD View Post
    I can see that it is more now, but the principle is still the same - they saved over 3 years, as oppose to 5 but they still saved! 3 x your salary is still a fair old task no? Well it is for me anyway.


    Chris
    No, they didn't save over 3 years, the morgage the required was 3x his annual income. I borrowed 4x my income but I had a 20% deposit, otherwise it would have been 5x.

    eeps, actualy I did borrow 4.25x if you count my net pay. Plus the £1000 cost of the mortgage it's self! (I have to pay money to give you more money?)
    Last edited by chazzy2501; 25th July 2012 at 12:21 PM.

  4. #64

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    Quote Originally Posted by CPLTD View Post
    I can see that it is more now, but the principle is still the same - they saved over 3 years, as oppose to 5 but they still saved! 3 x your salary is still a fair old task no? Well it is for me anyway.


    Chris
    Kinda missed what I said. They didn't save anything for their deposit - they were very lucky (and careful when they bought, as they managed to get a repossessed place which needed work!)

    But, most people didn't have that. Instead they had to save 20% of the mortgage, which in my parents case would have been 3/4 of a year's salary. So, it would have taken a while to save, but doable. Also, their first place was a 2 bed.

    Now, a 20% deposit for a single place would mean saving around a year and a bit's salary - which is an increase. Which would be for a 1 bed flat. A 2 bed like my parents' would mean about 3 years of salary saving...

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    Quote Originally Posted by aerospacemango View Post
    That seems to be a rather harsh appraisal of what was said, Either you've not paid attention to the answer you were given....or you just don't want to read it.

    As I understand it, @AMLightfoot said that the deposit was a loan arrangement between herself, her significant other, and her parents. Is this any different to someone taking out a loan for a deposit from the banks? (Other than a favourable interest rate!) Therefore, it is a bit nasty to suggest that "someone else put them there". This is one way that many people scrape together the deposit.....Are they ALL in the wrong?
    No they aren't "wrong" and I have never sad at any point they are "wrong". What I said was, it is a bit rich to say it is more secure and not throwing money away and you should get on the ladder when the only reason you are there is because your parents saved and helped you get there, I stand by it.

    If you are lucky enough for your parents to do this for you then that is great but you cannot really offer others advice and to be honest I would be a little shy about it - not proud to the point I am offering advice to others to get on the ladder and not throw your money away renting which is what was said previously. That is just the way I am.

    How can you take loan from the bank for a deposit, as well as pay the mortgage and call yourself fiscally responsible? You are piling debt upon yourself from both sides - the people I know who have done this are the same people who are now really struggling and for what to "own" a house?

    "not paid attention..........or I just don't want to read it" not very constructive but cheers @aerospacemango




    Chris
    Last edited by CPLTD; 25th July 2012 at 12:28 PM.

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    Quote Originally Posted by localzuk View Post
    Kinda missed what I said. They didn't save anything for their deposit - they were very lucky (and careful when they bought, as they managed to get a repossessed place which needed work!)

    But, most people didn't have that. Instead they had to save 20% of the mortgage, which in my parents case would have been 3/4 of a year's salary. So, it would have taken a while to save, but doable. Also, their first place was a 2 bed.

    Now, a 20% deposit for a single place would mean saving around a year and a bit's salary - which is an increase. Which would be for a 1 bed flat. A 2 bed like my parents' would mean about 3 years of salary saving...

    But it is doable - it just means sacrificing...... that is what I meant.


    Chris

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    Quote Originally Posted by CPLTD View Post
    But it is doable - it just means sacrificing...... that is what I meant.
    No. You've missed the point *again*. It isn't doable! I can afford to save around £150 a month. That's the lot. Which means I would have to save for around 14 years to afford a mortgage for a 1 bed flat.

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    Quote Originally Posted by cpltd
    I just find it a bit rich to give advice on buying a property and suggest to people they should get on the property ladder due to security and not throwing money away on rent. When, the only reason they are on the ladder in the first place is because someone else put them there.
    So that makes our experiences and opinions less valid? It makes my observation that it is WORTH looking at shared ownership worthless? We looked at it. We did the maths and had the meetings. It is always worth doing the exercise as you cannot make an informed decision without having done the exercise. Getting on the property ladder isn't easy, but if you have the opportunity DO. If you are going to rent anyway, yes, shared ownership shaft you, but IMO it is better to have some equity than none at all, but there are caveats and you have to be cautious - we learned a valuable lesson and nearly got stitched up and I feel that my experience is worth sharing. As for 'these aren't personal comments', that sounds pretty personal to me. I want to make it clear that NO-ONE 'put me there'. That implies that a relative died and left me their house in their will and here I am having inherited a house pontificating sanctimoniously at non-home owners. That is offensive and cheapens the work we have done and the effort we have put into getting on the property ladder. It makes me out to be greedy and grasping when the very opposite is true. LeBoyfriend and I were lucky enough to have parents in the position to help us buy our house, but it is not without cost. As it happens, 2 years ago my parents paid nearly £10,000 for my sister's wedding - does that make her greedy and grasping too? Instead of paying for a big ol' party, my parents lent me my 'wedding fund' to help me buy a house, but I have to pay it back one way or another (as I said, the full details are private and I shan't be divulging them). LeBoyfriend's parents have also helped us, but that doesn't mean that it's 'free money' either! The point I was making to the OP was that there are always options to look at. It seems desparate but there are lots of schemes out there to help you get on the ladder, you just have to be careful. As it happened, we nearly ended up in a Taylor Wimpey scheme but my father was horrified so they got together with the Inlaws and worked something out for us. If they hadn't been able to, they would not have, and we would have been living in the Taylor Wimpey house instead of the bigger, cheaper, slightly neglected, fixer-upper that we ended up with.

    Quote Originally Posted by aerospacemango View Post
    That seems to be a rather harsh appraisal of what was said, Either you've not paid attention to the answer you were given....or you just don't want to read it.

    As I understand it, @AMLightfoot said that the deposit was a loan arrangement between herself, her significant other, and her parents. Is this any different to someone taking out a loan for a deposit from the banks? (Other than a favourable interest rate!) Therefore, it is a bit nasty to suggest that "someone else put them there". This is one way that many people scrape together the deposit.....Are they ALL in the wrong?
    Indeed - I am under no illusions that when my children come to buy a property they will turn to me and LeBoyfriend for help. Even if it just means getting a loan on their behalf using the benefit of our much better credit rating to get a lower interest rate. When my parents were starting out, 100% mortgages still existed! My dad didn't NEED a deposit for his house! He worked hard and paid it all off. But the world changed. My Grandfather paid £3000 for a 3 storey townhouse in Goodmayes, London back in the late 40s/early 50's. My father bought his house for £70,000. It is now worth over £200,000!!! Perhaps the 'RELATIVE' worth hasn't changed, but it is still hard to get a £15,000 lump sum in todays world! They don't even do 95% LTV mortgages anymore unless you buy a newbuild and this is another thing that is worth looking at - bovis and taylor wimpey subsidise you to buy their new houses so you put in 5% and they put in 5% and you get a 10% LTV then depending on the scheme, either you repay it or they 'gift' it (i.e inflate the house price). That means you only need £7,500 which is more reasonable, but it's still pretty hard to have that sort of lump sum just 'lying around' when you're in your 20s.

    Quote Originally Posted by localzuk
    No. You've missed the point *again*. It isn't doable! I can afford to save around £150 a month. That's the lot. Which means I would have to save for around 14 years to afford a mortgage for a 1 bed flat.
    Exactly. By the time you've saved enough for a deposit for the price of a house NOW, that house will have doubled in cost and you'll still be in the same position. That £15,000 you saved is now only a 5% deposit (obviously inflation dependant). Now assuming you get out of Uni at 21 and get a job and start saving that £150 IMMEDIATELY (which ofc no 21yo will - you have a life to live!), you'll still be 35 by the time you have anywhere near enough money and that is assuming that you don't live your life, go on holiday, get a car, get made redundant, have emergencies that end up costing a lot of money. Wow, that sounds like a THRILLING life to me!
    Last edited by AMLightfoot; 25th July 2012 at 12:47 PM.

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    CPLTD's Avatar
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    Quote Originally Posted by localzuk View Post
    No. You've missed the point *again*. It isn't doable! I can afford to save around £150 a month. That's the lot. Which means I would have to save for around 14 years to afford a mortgage for a 1 bed flat.
    But that is you specifically - I am saving and can afford to with my partner - we can save up to £400 a month and will still take ages but were are trying - why is that such a problem to everyone else?

    So is the answer not to try at all and borrow instead?

    That is what i am getting at.

    Chris

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    DrCheese (25th July 2012)

  12. #70

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    Quote Originally Posted by CPLTD View Post
    But that is you specifically - I am saving and can afford to with my partner - we can save up to £400 a month and will still take ages but were are trying - why is that such a problem to everyone else?

    So is the answer not to try at all and borrow instead?

    That is what i am getting at.

    Chris
    You seem to be ignoring the underlying fact here. For a lot of people now, buying a house is simply not possible. As AMLightfoot says - even if I save at my current rate for 14 years, inflation will mean that I still can't afford a house. Nothing that I can do, other than massively increase my income, will solve that. My parents generation had to save for a lot smaller time to afford their deposits, meaning inflation was less of an issue.

    £32k to £142k in less than 10 years. That's the key point here. Using the same amount of growth, if that continued, in 10 years, the same house would be going for £630k. My wage isn't going to increase to £120k a year in that time...

    I'm not advocating borrowing anything. I'm saying that your attitude that if you're financially prudent that you can do it all properly is wrong. I don't even earn the 'national average', and remember than 50% of the population don't either. So, there's a helluva lot of people like me.

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    i realise im late to this convo so if ive missed anything, apologies.

    Think i would be looking at repossessions, my current property is a large 3 bed flat that i managed to snap up for 26k LESS than the advertised price because it was a repo. Although i cant comment on the prices of housing in London a large 3 bed house with garden and garage is around the 110K mark here...


    I wouldnt borrow money as this will go against you when you apply for a mortgage, however if you can get someone else to borrow for you that then wouldn't be counted in the mortgage calculation, i also recommend renting for atleast a few months to a year. Not for any other reason than to make sure you can afford to pay bills/council tax/car, if you rent a similiar property to the one you want to buy then you will be in good standing.

    other schemes to consider is the rent for a year then buy, however be careful with this one, the idea is that you rent for a year then use the rent money to buy the house, a friend of mine got caught out and rented for 14 month then decided to buy, to only be told that he didnt have enough, when he queried they told him he had only saved two months of deposit because if you do not buy after 12 months the money goes to company and you loose it guess he didnt read the smallprint.
    Last edited by Flakes; 25th July 2012 at 01:01 PM.

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    Quote Originally Posted by CPLTD View Post
    But that is you specifically - I am saving and can afford to with my partner - we can save up to £400 a month and will still take ages but were are trying - why is that such a problem to everyone else?

    So is the answer not to try at all and borrow instead?

    That is what i am getting at.

    Chris
    The problem I had was with your dismissive and insulting attitude towards me and my opinions and the way you imply that I am not worthy to share advice because I happened to borrow some deposit. What you choose to do yourselves is your affair, but consider this: Realistically the practicalities of waiting too long to get on the property ladder will make it hard for you. Age, for example, is a surprisingly important point. Mortgages taken over 30 years have the best interest rates and obviously the lowest repayments (assuming you have a repayment mortgage not an interest-only, the prospect of which terrifies me). But to qualify for a 30 year mortgage at the current time with the current guidelines (and these may be subject to change), men must be under 35 and women must be under 30 as the bank will only lend over 30 years if you have 30 years of potential employment and stable income (yeah yeah we all know that this isn't realistic in this economic climate but thats the way banks are) blah blah blah retirement age, blah blah blah. So the government do away with retirement - how many 63yos do you know that are on the scrap heap now after being made redundant? I know a few. Regardless of what happens in the REAL WORLD, the banks still assume that you will retire at 65 or 60 and will only lend to you based on that. So if you're 40 you can say goodbye to any chance of a 30 year mortgage. You'll need a 20 or 25 year one in which case say hello to higher interest rates and higher repayments.

    This is why I believe it is so crucial to get on the property ladder however you can as early as possible even if it means organising 'private finance deals' with relatives.

    So if you borrow now and pay back your benefactor later on, you can get a mortgage over a longer term thus reducing the costs. If you bravely solider on saving by yourselves and not borrowing anything, every year that passes over the age of 30/35 is another year less they will lend over and the repayments and interest rates start to climb until you get to a point where you just can't afford it! Surely it is better to jump on that ladder as soon as you can to secure the longer mortgage term even if that means borrowing now and repaying that deposit later?
    Last edited by AMLightfoot; 25th July 2012 at 01:08 PM.

  17. #73

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    Quote Originally Posted by AMLightfoot View Post
    So that makes our experiences and opinions less valid? It makes my observation that it is WORTH looking at shared ownership worthless? We looked at it. We did the maths and had the meetings. It is always worth doing the exercise as you cannot make an informed decision without having done the exercise. Getting on the property ladder isn't easy, but if you have the opportunity DO. If you are going to rent anyway, yes, shared ownership shaft you, but IMO it is better to have some equity than none at all, but there are caveats and you have to be cautious - we learned a valuable lesson and nearly got stitched up and I feel that my experience is worth sharing. As for 'these aren't personal comments', that sounds pretty personal to me. I want to make it clear that NO-ONE 'put me there'. That implies that a relative died and left me their house in their will and here I am having inherited a house pontificating sanctimoniously at non-home owners. That is offensive and cheapens the work we have done and the effort we have put into getting on the property ladder. It makes me out to be greedy and grasping when the very opposite is true. LeBoyfriend and I were lucky enough to have parents in the position to help us buy our house, but it is not without cost. As it happens, 2 years ago my parents paid nearly £10,000 for my sister's wedding - does that make her greedy and grasping too? Instead of paying for a big ol' party, my parents lent me my 'wedding fund' to help me buy a house, but I have to pay it back one way or another (as I said, the full details are private and I shan't be divulging them). LeBoyfriend's parents have also helped us, but that doesn't mean that it's 'free money' either! The point I was making to the OP was that there are always options to look at. It seems desparate but there are lots of schemes out there to help you get on the ladder, you just have to be careful. As it happened, we nearly ended up in a Taylor Wimpey scheme but my father was horrified so they got together with the Inlaws and worked something out for us. If they hadn't been able to, they would not have, and we would have been living in the Taylor Wimpey house instead of the bigger, cheaper, slightly neglected, fixer-upper that we ended up with.
    You are still taking this very personally and I am speaking about the subject in general - I would say the same to anyone so please try and separate my views from a personal attack on yourself! I really don't mean it that way and you seem to be taking offence......again. At no pint have I said your views are less valid either again, you taking it personally. Why does it have to be personal on here- this is what puts others off posting and why the forum has so many blooming lurkers!

    I would not say get on the ladder asap when your choices are borrowing money to do it or going though shared ownership schemes, again putting yourself in more debt and paying even more over the odds for a pipe dream of having to own your own property. It really isn't worth it,. If you have been helped onto the ladder by parents or anyone else it surely isn't as easy to suggest to others to look at this route is it?

    I am sorry but I still think that is a fair point. As I have said previously we obviously aren't going to agree so let's agree to disagree...........nothing is ever black and white so I think this is a fair end to my posts.

    Sorry again if you have taken offence - I really cannot help that it is just my view.

    Chris

  18. #74

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    Quote Originally Posted by AMLightfoot View Post
    The problem I had was with your dismissive and insulting attitude towards me and my opinions and the way you imply that I am not worthy to share advice because I happened to borrow some deposit.
    Seriously you are still doing it - This is not nor ever has been a personal persecution aimed at you??

    Chris

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    Quote Originally Posted by localzuk View Post
    You seem to be ignoring the underlying fact here. For a lot of people now, buying a house is simply not possible. As AMLightfoot says - even if I save at my current rate for 14 years, inflation will mean that I still can't afford a house. Nothing that I can do, other than massively increase my income, will solve that. My parents generation had to save for a lot smaller time to afford their deposits, meaning inflation was less of an issue.

    £32k to £142k in less than 10 years. That's the key point here. Using the same amount of growth, if that continued, in 10 years, the same house would be going for £630k. My wage isn't going to increase to £120k a year in that time...

    I'm not advocating borrowing anything. I'm saying that your attitude that if you're financially prudent that you can do it all properly is wrong. I don't even earn the 'national average', and remember than 50% of the population don't either. So, there's a helluva lot of people like me.


    I am not ignoring anything at all - For a lot of people it isn't possible currently, but there are also a hell of a lot of people like me who do save and are renting currently? And it is possible - 8 out of 10 of my friends have all done this over the last 5 years so I know it is. I live in Market Harborough and the 3 bedroom property that I rent and it is currently valued at £179k so I know what you are saying but it is possible!


    Chris

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