Should I buy my dream home ?

Entertainer

How safe are your jobs? We are in the biggest depression since the 1930's remember.

Its gonna cost me £1000 more or less per month on the mortgage (including insurances)

Interest only or repayment? What's the interest rate?

GDB2222

If you do decide to go ahead, I strongly suggest you consider fixing the mortgage interest rate for a long time. By long time, I mean preferably the life of the mortgage, but in any case a minimum of 5-10 years.

These long term fixes are available. As examples, Britannia offer a 15 year fixed interest loan at 5.59%, Manchester BS offer 30 years fixed at 5.89%. There are some hefty early redemption charges on these, up to 7% on Britannia, 3% on Manchester. I am not recommending either loan, just showing that these are available.

BTW, I am expecting the drop in prices to continue, with probably another 20% drop to come, but who knows whether I am right?

QTPie

GDB2222 wrote: »

If you do decide to go ahead, I strongly suggest you consider fixing the mortgage interest rate for a long time. By long time, I mean preferably the life of the mortgage, but in any case a minimum of 5-10 years.

These long term fixes are available. As examples, Britannia offer a 15 year fixed interest loan at 5.59%, Manchester BS offer 30 years fixed at 5.89%. There are some hefty early redemption charges on these, up to 7% on Britannia, 3% on Manchester. I am not recommending either loan, just showing that these are available.

BTW, I am expecting the drop in prices to continue, with probably another 20% drop to come, but who knows whether I am right?

It is all a big game of "Chicken" really...

... what is right for some people, isn't right for others. The biggest gamblers can sometimes be the biggest winners, but can also be the biggest loosers...

I think that the property market is all about working out what is right for you, in your specific situation, and doing it. Do your research and make sure that you are aware of all of the risks. Don't over-extend yourself TOO far (if you lost your job, could you find a new job or fill in work and still cover your mortgage?).

QT

GDB2222

QTPie wrote: »

It is all a big game of "Chicken" really...

... what is right for some people, isn't right for others. The biggest gamblers can sometimes be the biggest winners, but can also be the biggest losers...

I think it is a big enough gamble buying a house at the moment, without also gambling on future mortgage interest rates.

QTPie

GDB2222 wrote: »

I think it is a big enough gamble buying a house at the moment, without also gambling on future mortgage interest rates.

Completely agree - if you look at my previous post (no 10 on this thread), you will see that I suggest a long-term fixed rate (probably 10 years): so at least the OP has fixed mortgage outgoings for the longer term...

QT

tiff

I wouldnt do it with the financial situation the way it is at the moment. A lot of people here would love a mortgage of £69k and income of £3k. Move to a bigger house yes, but not £1000 extra per month.

ILW

rickswords wrote: »

Could anyone help persuade me to buy my dream home

Think you may do better buying a real one.

debbieallan

We only had 4 yrs left on our mortgage but have decided to move to a much bigger house which we are paying off over the next 10 yrs max. The monthly payments will be much higher but so will our standard of living. We had looked at bigger houses before but they were crazy prices. The house we are buying is good value and we believe it can only go up. We can also remember interest rates of 15% but we have fixed ours for 10 yrs at 5.4% so there won't be any nasty surpises (hopefully). If one of us loses our job it will be hard but there is risk involved in everything. We also plan to downsize when we retire and give our daughter a deposit for a house from the proceeds. PS. We sold our house in 3 weeks and got a mortgage no problem so don't be put off by all the stories of doom and gloom.

Radiantsoul

Well the mortgage does not seem to be an unreasonable proportion of your income, you have a lot of equity in the property(it is doubtful prices will fall by much more than 10% in the next year).

If you are in it for the long haul then why not I don't think the financial strain is massive. On a short term basis you might regret in a couple of years time not holding out for a few years.

GDB2222

QTPie wrote: »

Completely agree - if you look at my previous post (no 10 on this thread), you will see that I suggest a long-term fixed rate (probably 10 years): so at least the OP has fixed mortgage outgoings for the longer term...

QT

I saw that, but I couldn't see why you were saying it's a game of chicken. That implies taking unnecessary risks for fun, with no benefit.