FTB - Are we mad to buy now?

MrMalkin

cmart021 wrote: »

Also, there are very little nice houses for let for the same money in this area, and id be gutted to pay out 800 a month in rent knowing that a mortgage would cost just over 1000.

But a £1000 mortgage payment for the first few years will consist of more than £800 interest which you'll never see again. If you hold off, you'll be able to save up for a bigger deposit, which will reduce future mortgage payments, prices will continue to decline, which will also reduce future mortgage payments, and you'll potentially have another year of pay increases or promotions, which will give you more breathing space. I bet if you wait a while and scale back your expectations you'll have a good chance of getting a mortgage with repayments of less than £800...

mlz1413

Cmart have the rents gone up in your area? Eariler you said you could rent for £700 ish now your saying renting a lesser house will be £800 - is this a real increase or one that makes you feel better about an I/O mortgage for over £1000 pm?

You seem convinced that the house is a bargain at £190k, maybe you could go into a couple of EA and ask them to value it for mortgage purposes (not resale), remember a mortgage company will only lend on what a surveyor says it is worth and that could be less than EA valuations.

I think you need to have a serious look at the house - when will windows, boiler, carpets, kitchen need replacing these will all be your responsibility when you own including things like a slates and arieals blown and off the roof in high winds. Have you looked at how much buildings insurance will be added onto the extra mortgage cost?

cmart021

mlz1413 wrote: »

Cmart have the rents gone up in your area? Eariler you said you could rent for £700 ish now your saying renting a lesser house will be £800 - is this a real increase or one that makes you feel better about an I/O mortgage for over £1000 pm?

You seem convinced that the house is a bargain at £190k, maybe you could go into a couple of EA and ask them to value it for mortgage purposes (not resale), remember a mortgage company will only lend on what a surveyor says it is worth and that could be less than EA valuations.

I think you need to have a serious look at the house - when will windows, boiler, carpets, kitchen need replacing these will all be your responsibility when you own including things like a slates and arieals blown and off the roof in high winds. Have you looked at how much buildings insurance will be added onto the extra mortgage cost?

Thanks for the reply. I have seen 1 house similar to ours in a near neighbourhood for 800 pcm although lesser houses are around 700 pcm, just to clear that. I may indeed have an agent look at the house, not a bad idea. The house is up bout 10 years so im hoping windows will not need replaced, as for carpets etc, we are in a nice position to have family that are tradesmen and with approval from the LL we have already replaced some of the crapets to make it comfortable for us ( I know the ultimate sin spending money we will not see again).

The mortgage broker has given us a quote for buildings insurance and it has been added to the outgoings list on budget.

Just one more question, due to us missing the band for not paying stamp duty, do you think we would be able to bargain for the vendor to pay stamp duty?

I have recently found out that if we dont take the house it would leave him in a pickle, after an offer is accepted is it possible to maybe take him down more?

Just chancing my arm.

mlz1413

You are in the very best position to barter, LL has no EA fee to sell to you so thats approx £2000 saved. He will receive rent up until you buy whereas if you moved out of house he could have 1 to 6 months without rent (only if new buyer exchanged and agreed to wait for your 2 month notice period to be served would he be in that same position - and I can't imagine anyone exchanging on a property with tenants in it)

I have heard of buyers and sellers agreeing to a stamp duty threshold price and then paying for 'fittings' like curtains and furniture, so basically you pay cash for the amount over stamp duty - you may struggle there as I guess all your cash is for the deposit and the rest is mortgaged.

I'd see what the EA say its worth then approach LL with an offer / conditions.

alchemistkevin

Chance and chance once more.With what I've read about NI and your position there alongwith the house never being on the open market, I'm pretty sure you can show your LL a case of saving a ton of money and having a hassle free sale if selling to you.

Try and get under £175k for tax purposes.