New House :)

PeterJames123

Hi Guys,

My wife and I are currently living in my parents house and now looking to buy our first house. We bring in around £2000 a month and have expenses of about £30 on mobile bills. We have managed to save £38k and now do not want to make the wrong step when it comes to buying a house. Can somebody please advise me on a price we should be looking at for a house. We will be looking to starting a family as soon as we move in so the income would only be £1300. Thanks

nementai

Based on my experience, I'd suggest the following;

Step 1. Find a house for sale online that meets your basic needs. Doesn't have to be perfect, just an example of area, space etc. You can use this for getting your projected figures.
Step 2. Work out how much 'spare' cash you'll have per month, after likely council tax (for the property you found above), energy bills, food etc. Maybe ask your parent about this, and remember to factor in the baby!
Step 3. Using the pricen the house in step 1 is on for, use a mortgage calculator to work out what your likely repayments would be. i.e. if the house is £100k, and you have £38k, look at fixed rates (so there are no surprises 6 months down the line) for a 62% mortgage, and check out your monthly repayments.
Step 4. Compare step 2 and 3 figures. Try not to cry.
Step 5. Start modifying the house (ie. find something cheaper), lengthen the mortgage term, etc. until it becomes affordable. If your money will only get you a studio flat in bumtown, keep saving, or delay the baby!

I found when I started looking, that the size of house and area I wanted were completely unobtainable. A few compromises can make a world of difference.
And don't forget to factor in rate increases. I was amazed at how much more an extra 1% on the interest made to monthly repayments.

Pitchshifter

I'd say don't buy yet, prices are still way overpriced for people with normal incomes.
Leave it 2 more years and I think the prices will have come down to a point where they can be bought easily by average earners.
Saving at the rate you are currently, you could have saved another £47,000 in 2 years, putting you in a position to get a better house with a much smaller mortgage.

bobothebear

Expenses of about £30 a month!!

Do you not eat?
Drive a Car/Public Transport?
Wear Clothes?
Wash?

As others have suggested i'd keep on saving.But it all depends on where you live as prices can vary so much from north to south.