FTB - How much mortgage and when to buy?

vicky_kidder

Hi,

Me and my partner are (potential!) first time buyers aged 22 and 25. We earn £52,000 between us and are thinking about buying at the end of 2009. We SHOULD have approx £20,000 saved between us by then, and both salaries are due to increase by a fair amount in a couple of years.

So,

1) How much mortgage do you think we will be able to get and for what value house?

2) Are we sensible to be looking at the end of next year or should we be waiting longer?

lincroft1710

Best advice would be wait until end 2009 then see what both house prices and mortgages are doing, if prices still falling - wait.

summermummy

Most experts say that you should not spend more than 30% of your earnings on mortgage repayments - less if possible. Buy a house when you feel comfortable with the house and the price. No one knows better than you when that time is. If you put 'first time buyer' into Google, I think there a few ftb sites that offer guidance in this area.

_Andy_

Dependent on lender, affordability and LTV it can be up to 5x joint income.

penguine

Don't know what price range you'll be looking at, but £20k would be a 20% deposit on a £100k property, and if I remember correctly the best mortgage deals are now only available if you have at least a 25% deposit so you may want to save a little harder so you can get a better rate.

lonestar1

Mortgage around 200K looking to use 20K as 10% deposit means your looking at a house at around the 220k

Houses may still be falling at the end of next year but then again could soar again (I would bet they will still be dropping or at least flat but who can say)

Keep your eye on the market and keep on saving only buy when you think the market is flattening out is my advice ( or when the convenience of owning your own home outways the fears you may have of negative equity)

vicky_kidder

THanks guys!

We're looking at a 3-4 bedroom property (as I will be working from home and we want kids down the line), and in my area you can get a decent one for about £170,000. So I think they may be lower in over a years time and hopefully affordable to me!

It's really hard trying to get such a large deposit together with prices as high as they are - sometimes feel frustrated that we may never get on the ladder!

geoffky

at last a sensible couple......well done for you for not jumping in when prices have just dropped....

vicky_kidder

Thank you very much Geoffky! :beer:

Although, I feel bad on my parents because I'm living at home whilst I try and save to afford to buy my own place. I insist on paying rent to them (they initially didn't want anything!) but I know I need to stay here if I want to be able to get enough money for a deposit!

Icey77

Firstly, well done you and your other half for saving up £20k!!!

Please remember that this will be your home, not an investment with a view to making a profit. House prices will always go up and down, it's an availability and demand thing :rolleyes:

If you wait and wait and wait you might miss the boat but if you jump on now you might pay more than if you had waited a bit longer - it's a risk you're going to have to take, we all have to take it. Sometimes it all works out and sometimes it doesn't.

What you pay for your home is up to you and only you can decide what you can afford. Make up your own mind and stick with it! And enjoy livining in your own home when you get it! :beer:

fiodyl

Hi vicky

Me and my partner are in a similar situation to yourselves- we were originally looking to buy end of 2009 but have recently put this back to mid 2010, mainly due to the information I have read on this site.

Our income is only about £21k at the moment as i was made redundant in february, but the payoff I got meant we could clear our debts and boost our savings and be able to put away extra each month.

Our original goal was to save £30k by next year but as we already have this now so have set a new goal of £50k by june/july 2010. We really need to move by then as our daughter will be starting school the following september.

I don't know if its the same for you but, we still get friends and family telling us to buy now before its too late. When we tell them we are saving they say if we spend too long saving, we will miss our chance and never be able to buy. I don't think they watch the news, either that or they think this will be the only area not affected.