Buying a house

cruisinmanly

Hi

I know that everyone is running around spouting about this credit crunch, But my boyfriend and I are actually in a very comfortable position (after a few years of studying, working and saving). We have no debt and are planning on buying a house. We have decided to wait till next year to buy, possibly end of the summer 09...

Now, my query is that I don t understand what kind of credit disaster is going on, as I don t have any...But we are thinking of buying a house for £90 000 and putting a 10 000 dep down...we earn a combined salary of £50 000 with not many outgoings, Is the situation so bad that we would be refused a mortgage?

I m sure everyone has an opinion on this, so fire away let me know the situation, cause if its going to get worse, then I ll take our savings and have ourselves a very extended and nice holiday.....

lisyloo

Is the situation so bad that we would be refused a mortgage?

You will not be refused a mortgage with a 10% deposit.

Personally I think house prices will drop a lot further.
This is because they've been rising for 10-15 years so it's simply not logical for it all to be over in 12 months.
You may well be fine in 2009, but you might be much better off waiting and buying a few years later.

What is the rush to own if house prices fall?
Why not rent and save money each month?
You can still have your privacy and make something on a "home" in rented accomodation.

happybroker

In respect of what the "credit disaster" is....the banks basically have less money to lend and so are reducing the ranges of mortgages and also tightening the criteria. Previously mortgages were sold to other companies which is how banks kept finding new money to lend (securitisation) and it's this process that has stopped.

It's difficult to say what will be available in a year's time, it could be better, it could be worse but I doubt it given your circumstances.

If I were in your situation I would keep saving and get some good mortgage advice before you start looking at houses so you know where you stand.

When you do start making offers be cheeky with them...what's the worst they can say? I have had 2 clients this week have offers of £120k accepted on houses advertised at £150k! Happy days.

Good luck

_Andy_

I'd also suggest saving on top of the deposit - e.g. for emergencies, house repairs, etc etc. E.g. money in case the boiler breaks down or whatever.

sarkin

The problem you may face is the credit crunch starts affecting the wider economy, People in the building trade are loosing thier jobs, solicitors, surveyors, brokers and estate agents also. As people start spending less others business start to suffer i,e retail shops, restaurants, car dealerships. So my question is what do you do for a living and is it resesion proof, teacher, nurse, any goverment job.

You could find in a years time house prices are 30% lower but either you or your partner are out of work in which case you still will not be able to buy.

CHARDONNAY_3

You have had some very good advice which I also agree with. You don't mention much about your current circs (eg what job you do, where you currently live) but as said they should be taken into account. Could you lose your job? If you currently rent an affordable flat/house or live with parents, what is the rush?

With such a high income, I would expect you should get into the habit of saving alot more (my bf&I earn half your joint wage but have saved almost the same amount)

Looking at £90,000 houses on a £50,000 joint income seems very sensible and even if it becomes harder to get a mortgage, I can't see it becoming too much of a problem for you both. I also think it is realistic to wait at least 12 months. By then we will all have a better idea of what is going on - the houses you are looking at may be 10% less and your deposit may be £20,000. Keep saving and good luck!

cruisinmanly

Hi

I work for the police and my boyfriend works in IT....I suppose we can wait, and I had never thought about saving more for those repairs....more thinking required...also I m happy to receive more advice....

I suppose the rush is that we have been renting forever, and I m fed up with worrying about damaging the property etc...I want to be relaxed in my house....But we can always save more....(and hopefully resist the tempatation to blow it all)...

It seems more logical to wait to see what the market does in the next 12 months.....and thats what we ll do

cheers for the advice!