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  • FIRST POST
    • Louise1234
    • By Louise1234 15th Oct 16, 10:01 PM
    • 23Posts
    • 89Thanks
    Louise1234
    Is it always worth buying just to get on the ladder?
    • #1
    • 15th Oct 16, 10:01 PM
    Is it always worth buying just to get on the ladder? 15th Oct 16 at 10:01 PM
    A maisonette has come up in my town, 3 bedrooms for the price of a 2 bedroom in the area. It has been on the market since May and keeps being reduced. It has no parking and no garden but you can see the local park from it. We have seen it and nothing seems wrong (obviously no surveys done yet). The only downside that I can see is that it is opposite an old school that has been given permission to be knocked down and 64 new homes / apartments will be built in its place. Each house has a driveway / 2 parking spaces and each 1 bed flat has one space. The maisonette we like has no parking, dead end road directly opposite the new site. Nothing has started being built yet but permission was given in 2015 so presume it will be soon.

    My question is.... is it worth buying (as it is cheap and a step on the ladder) or would you wait and hold out for something else but will be more expensive. We have recently moved in with my mum so no longer paying £1250 in rent.

    I am a bit concerned we may get stuck there and not be able to move. It is big enough for our family but not our perfect home.

    Any opinions welcome
Page 2
    • Kynthia
    • By Kynthia 17th Oct 16, 7:32 AM
    • 4,695 Posts
    • 6,712 Thanks
    Kynthia
    Buying just to be on the property ladder is risky as it doesn't always work out. Buy somewhere you can afford, you are happy to live for at least the next five years. Buy somewhere that you can sell, or at least let, quickly should something unexpected happen. Following those three rules minimises the risks of ownership.
    Don't listen to me, I'm no expert!
    • Mortgage Moog
    • By Mortgage Moog 17th Oct 16, 8:08 AM
    • 140 Posts
    • 30 Thanks
    Mortgage Moog
    I was in a similar position recently. I had the choice of renting anywhere or buying but having to move a few miles further out than would be ideal but would only add a 10 to 20 minute drive on to some journeys I do.

    I chose to buy because it's the right deal for me in the long term. Sure it's a bit of a pain sometimes having to drive that bit further but it'd be much more of a pain paying twice the amount I am for my mortgage on rent so someone else can have their mortgage paid off for them!

    There's a lot of rubbish talked about how owning a home can cost more. What if the roof needs changing? What if the boiler packs up? If you're living in a maisonette (as I do) then those costs are tiny because they get split between everyone living in the same block. My block has 6 maisonettes in it so even if we got hit with an 18k bill for a roof repair it would only cost each property £3000 and that can be spread over 3 years so you're talking about £100 a month. Same for the boiler, a whole new system would only be £3000 and I could spread that over 3 years. Boilers and roof repairs are always used to scare people out of buying but they don't just blow up at random every year or two. A new roof and boiler would add value when you sell or you could knock some money off if the buyer would have to take over the payments. Either way you get it back give or take a little bit.

    Many renters have a false sense of security thinking that EVERYTHING is covered by their rent. Wrong. If you rent then the landlord can put the rent up by any amount they want at any time they want. Do you really think a landlord is just going to take a hit of several thousand pounds and not get it back through your rent? Even if you have it written into your contract that they can only put it up by 10% per year then they can get around that by simply ending that contract and starting a new one. Don't want to pay the new price? You've got a few weeks to find somewhere else to live then.

    It isn't always better to buy than rent but it's rare that you're better off renting. If prices are falling then rent but they'd have to be falling a lot for it to work out better buying, I mean thousands per year which is highly unlikely.

    I planned my move well over several years and could sell up now for more than I bought it for as I held out for the right property and got it at a crazy price due to the seller being in a rush after his previous sale fell through. Don't rush in to buying just anything or you could regret it but choose carefully and you can be paying off your mortgage instead of someone elses.

    I'll be moving as early as this coming summer because I saved up enough to cover moving fees before I moved in and have so much spare income that I can be ready to upgrade on in as little as 6 months.

    To sum up, don't just buy for the sake of getting on the ladder but don't be afraid to get on because it really isn't hard to get off if you change your mind so long as you're aware of the costs of selling and buy the right place to begin with.
    Last edited by Mortgage Moog; 17-10-2016 at 8:11 AM.
    • seven-day-weekend
    • By seven-day-weekend 17th Oct 16, 8:39 AM
    • 27,822 Posts
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    seven-day-weekend
    Things were probably a bit different in my day, but there is absolutely no way I would rent if I had any choice. Having said that, I would not overcommit myself either, so there might not actually BE a choice.

    As for the property under discussion, the lack of parking might be a problem in a three-bedroomed place, but once the building work opposite ids done, I think it will enhance rather than detract.

    Is there nowhere at all to park, n ot even in the road?
    To love someone is to learn the song in their heart and to sing it to them when they have forgotten it
    'I believe in Christianity as I believe that the sun has risen. Not only because I see it, but because I see everything by it': C.S. Lewis
    St. Augustine — 'In essentials, unity; in non-essentials, liberty; in all things, charity.'
    • Person_one
    • By Person_one 17th Oct 16, 9:29 AM
    • 26,010 Posts
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    Person_one

    And as you said, what happens if they become ill or disabled and are unable to work for a long time? Unemployment insurance only usually pays out for a year, that's if it pays out at all, and the insurance company doesn't pull an excuse out of their hat to not pay you!!!

    As you said, if someone had lost their job 6 months after buying the house, they would be up the creek. If they were renting, they could claim housing benefit.
    Originally posted by Peter333
    If you buy, its a good idea to have 6-12 months mortgage payments in savings, or as much as possible, as a buffer.

    If absolutely everything goes wrong and you definitely can't pay your mortgage anymore, you sell your house and live off the proceeds until you hit the threshold where you qualify for housing benefit. It would suck, but buying a house does not mean that you'd be in any different a position from anybody else who found they couldn't work ever again in the long run.

    If, as is far more likely, you don't have a terrible accident or life changing illness and continue to work until retirement, then you have a secure home, no rent payments and an asset that you can release equity from if you need to.
    • alchemist.1
    • By alchemist.1 17th Oct 16, 9:48 AM
    • 792 Posts
    • 616 Thanks
    alchemist.1
    I wouldn't be taking a risk on 3 bed maisonette without a garden or parking. Especially with newbuilds across the road. It will be difficult to sell on at a later date.

    My personal opinion is that once you get into the 3-bd range you are looking at families as potential buyers. You wont get that without a garden even with the park.
    • ScorpiondeRooftrouser
    • By ScorpiondeRooftrouser 17th Oct 16, 12:37 PM
    • 1,098 Posts
    • 1,503 Thanks
    ScorpiondeRooftrouser
    I wouldn't be taking a risk on 3 bed maisonette without a garden or parking. Especially with newbuilds across the road. It will be difficult to sell on at a later date.

    My personal opinion is that once you get into the 3-bd range you are looking at families as potential buyers. You wont get that without a garden even with the park.
    Originally posted by alchemist.1
    It won't be difficult to sell on at the right price.
    • ognum
    • By ognum 17th Oct 16, 12:48 PM
    • 4,321 Posts
    • 6,284 Thanks
    ognum
    Three bedroom flats are unpopular for BTL unless they can be let to families which if you have no garden is less easy.

    Once you have three unrelated tenants living in a property it comes an HMO with all the additional regulations.

    This may be why this particular flat is a less popular buy, it would also be a less popular resale.
    • Ozzuk
    • By Ozzuk 17th Oct 16, 1:10 PM
    • 835 Posts
    • 1,276 Thanks
    Ozzuk
    Rent vs buying aside (as we could debate that until my mortgage is paid off!) it really depends what your priorities are. For me the lack of parking with the added likelyhood of even more parking needed would be an instant no.

    You've already said this isn't your perfect home so its more an investment. As much as I'm pro-property I would want to be very sure of a good return within my intended payback period, especially if it is a house I didn't want to live in long term.

    I've bought houses previously as an investment and have done well - but I was sure I was paying a price I could make money on. If you aren't that sure then its likely not worth the risk IMO.
    • Cakeguts
    • By Cakeguts 17th Oct 16, 3:01 PM
    • 897 Posts
    • 1,122 Thanks
    Cakeguts
    What is the local aspiration in terms of housing? If this property is in an area where most people buy flats as a first purchase then it is a good idea but if first time buyer properties mostly consist of small terraced houses and new builds are houses rather than flats then a 3 bed maisonette would have to be very very cheap to be worthwhile because you would also have to sell it very cheap.
    Last edited by Cakeguts; 18-10-2016 at 12:15 PM.
    • Out, Vile Jelly
    • By Out, Vile Jelly 17th Oct 16, 3:28 PM
    • 2,977 Posts
    • 9,557 Thanks
    Out, Vile Jelly
    A 3 bed leasehold with no parking or garden has a fairly limited range of potential buyers. If it's not your forever home I wouldn't bother.
    They are an EYESORES!!!!
    • bris
    • By bris 17th Oct 16, 3:47 PM
    • 6,145 Posts
    • 5,104 Thanks
    bris
    It's on the market since may and keeps being reduced, you would be mad to buy it just for the sake of it.


    No one wants it just now then it's not desirable, why lumber yourself with an undesirable property?


    When it comes to you wanting something you really like your stuck with the undesirable property no one wants, unless another mug comes along to take it off your hands. By that time your accepting reduced offers just to get rid of it, if your lucky.
    • alchemist.1
    • By alchemist.1 18th Oct 16, 10:28 AM
    • 792 Posts
    • 616 Thanks
    alchemist.1
    It won't be difficult to sell on at the right price.
    Originally posted by ScorpiondeRooftrouser
    Indeed.

    Buying it for the right price may be difficult though seeing that its been on sale since May.
    • ScorpiondeRooftrouser
    • By ScorpiondeRooftrouser 18th Oct 16, 1:37 PM
    • 1,098 Posts
    • 1,503 Thanks
    ScorpiondeRooftrouser
    Indeed.

    Buying it for the right price may be difficult though seeing that its been on sale since May.
    Originally posted by alchemist.1
    That might well be true, but there's no such thing as a house that's inherently a bad buy or difficult to sell. Paying too much for this one just puts you in the same position as paying too much for a 3 bedroom semi with parking.
    • Jack Johnson the acorn
    • By Jack Johnson the acorn 18th Oct 16, 11:23 PM
    • 1,008 Posts
    • 1,029 Thanks
    Jack Johnson the acorn
    So many people sing the praises of buying a property, but really, unless you are properly well-off (like on the mid 6 figures per year between you,) buying is often a struggle. And many people who DO buy won't admit it.

    Social housing is really the best bet for many these days. Shame there's not enough for everyone who wants it to have it.
    Originally posted by Peter333
    What a load of drivel. Social housing is best for many!
    Yes let's all aspire to live in an area full of benefit claimants, where crime is high, achievement is low and desirability is close to zero.

    Me and the wife bought in our early to mid 20's (5yrs ago). We earned less than £50k combined and we managed just fine... Within that time we even got married, had a baby & paid out for a new roof and windows .... shock horror. We should be mortgage free within 8-10 yrs.

    Yes owning a home will have it's drawbacks but in the long run over a 20-30 yr mortgage your chancing of being worse off than a rentier is close to ZERO. Especially with interest rates being so gloriously low, we would be paying £200-£300 more a month in rent for a similar property.

    And in 10 yrs time I will be 40, living in a home worth £150,000.00 (at present) with no mortgage/rent to pay for the next 30+ yrs hopefully. Upon our death we will be able to pass down our remaining wealth to our child. What could be better than that...... In Peters world paying £700pcm for the next 30+ yrs is the best option (£252,000.00 well spent he reckons..... based on a hypothetical no increase to the rent)
    Last edited by Jack Johnson the acorn; 18-10-2016 at 11:29 PM.
    • Crashy Time
    • By Crashy Time 19th Oct 16, 4:14 PM
    • 2,907 Posts
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    Crashy Time
    What a load of drivel. Social housing is best for many!
    Yes let's all aspire to live in an area full of benefit claimants, where crime is high, achievement is low and desirability is close to zero.

    Me and the wife bought in our early to mid 20's (5yrs ago). We earned less than £50k combined and we managed just fine... Within that time we even got married, had a baby & paid out for a new roof and windows .... shock horror. We should be mortgage free within 8-10 yrs.

    Yes owning a home will have it's drawbacks but in the long run over a 20-30 yr mortgage your chancing of being worse off than a rentier is close to ZERO. Especially with interest rates being so gloriously low, we would be paying £200-£300 more a month in rent for a similar property.

    And in 10 yrs time I will be 40, living in a home worth £150,000.00 (at present) with no mortgage/rent to pay for the next 30+ yrs hopefully. Upon our death we will be able to pass down our remaining wealth to our child. What could be better than that...... In Peters world paying £700pcm for the next 30+ yrs is the best option (£252,000.00 well spent he reckons..... based on a hypothetical no increase to the rent)
    Originally posted by Jack Johnson the acorn

    Yes, some would be "rentiers" will be feeling the pinch pretty soon it looks like....
    http://www.telegraph.co.uk/personal-banking/mortgages/the-buy-to-let-borrowers-marooned-on-high-rates-for-life/...
    • hohum
    • By hohum 19th Oct 16, 5:09 PM
    • 469 Posts
    • 972 Thanks
    hohum
    I think it is worth buying (says the very experienced home owner of one year ) but within certain 'yes and' caveats.

    - are you within your means? Having witnessed the housing boom and bust of the past 10 years, I was pretty keen that we kept within our fairly tight budget.

    - are you buying just for the sake of having property? I'm not convinced that is a good idea. We bought because we wanted somewhere to live, and because we got the opportunity to buy

    - how much of a risk are you taking on resale? The property we bought is in an area I consider to be undervalued, with fairly substantial shopping/ transport developments over the next few years. The area isn't really a buy to let proposition, so our resale market would be young families. It looked like prices remained fairly stable, apart from in the mid 2000s where they reflected the national housing price boom

    We had some fairly tight criteria, and it took a reallllly long time for us to find the right property. Ours had been sat empty, and had been on the market for over a year. I don't think this necessarily indicates a problem property. It had some absolute howlers in terms of interior decor that probably put people off, plus they'd put the wrong postcode on property listing sites so it wouldn't have showed up in area searches. It was listed at offers in the region of £105k, and we got it for £96k. The big expenditures were replacing ridge tiles (£2300 because scaffold), and a leaking water mains pipe under the house. We managed to get the water company to contribute toward replacement (I said things about duty of care to water conservation) and paid £500 over 10 months of interest free installments. The ridge tiles were flagged in survey, the water mains we only discovered when we lifted the access hatch in the kitchen. Oh, and we weren't connected to the gas for 5 weeks after moving in. Bad decorative order will usually mean not a lot of maintenance, so we allowed for a bit of additional expense that way.

    However, it is very typical of it's market and right for our needs. We are mindful in that it's not a local market that will bear fancy extravagant home improvements I'm not sure that this maisonette is such a bargain, though. There's no point making one of the biggest purchases of you life just because it looks like a bargain. Although I confess, I do feel like ours was a bargain due to our ability to see past artex and strand board decorative panelling ( ) and I like bringing our little home out from under the weight of bad decorative decisions past.

    It is very much cheaper for us to buy rather than rent in terms of running costs. The mortgage on our 3 bed home is £100 cheaper a month than the rent we paid on our 2 bed home, and £200 cheaper than the market rate. The improvements we made we factored in to the purchase cost. Our running costs are also slightly lower in terms of utilities etc.

    Oh, and it's a little naive to think social housing is linked to lack of aspiration. It would probably be better than the situation we have now, where private individuals profit from taxpayers money in the form of housing benefit for private tenants.
    • amateur house
    • By amateur house 20th Oct 16, 12:07 AM
    • 76 Posts
    • 66 Thanks
    amateur house
    Very true. And despite stories on here from people who reckon they purchased their home less than 10 years ago, and have paid their entire mortgage in 4, 5, or 6 years or thereabouts, the fact is that the vast majority of people will not pay for their house until they're past 70! And the chances of them getting ill for a long spell, or being out of work for a long period of time, or losing one wage because of one partner looking after children, is quite high!

    And as you said, what happens if they become ill or disabled and are unable to work for a long time? Unemployment insurance only usually pays out for a year, that's if it pays out at all, and the insurance company doesn't pull an excuse out of their hat to not pay you!!!

    As you said, if someone had lost their job 6 months after buying the house, they would be up the creek. If they were renting, they could claim housing benefit.

    So many people sing the praises of buying a property, but really, unless you are properly well-off (like on the mid 6 figures per year between you,) buying is often a struggle. And many people who DO buy won't admit it.

    Social housing is really the best bet for many these days. Shame there's not enough for everyone who wants it to have it.
    Originally posted by Peter333
    I don't know anyone still paying a mortgage at the age of 70, though that doesn't mean some aren't, but I doubt it's the majority. The first year or two of paying a mortgage are usually the toughest, but as you get pay rises and the mortgage stays the same, especially if you get a fixed rate, it gets easier. Whereas rents usually go up. We've never had anything close to a six figure salary! I doubt we would qualify for housing benefit as I still have an income, but as the rents per month being charged for houses on our street now are more than my take home pay there is no way we would be able to afford to stay if we were renting.

    I think if the OP feels this house is somewhere they would feel happy living then buying gives far more security than renting. As others have said if something like redundancy does happen they can sell up and won't be in any worse position than if they carried on renting.
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