FTB - Should you stretch to buy the best available?

MMG

Hi there,

Myself and my partner are currently looking around at homes as first time buyers.

Have been looking at properties in and around the 200k mark which are nice, and seem to have no major downsides.

However, I've seen a new house in a fantastic location, 4 beds, 2000 sq ft, garage. It's up for £270k and there isnt much negociation to be had on this.

It seems that the difference will be approx £250 - £300 a month mortgage wise between the houses we were looking at, and the one I'm mentioning now. At the most expensive end of the spectrum, it would still leave us approximately £1000 "disposable" income to share between us.

Is it worth stretching yourself for a fantastic property? I honestly could see the house being suitable for at least 15-20 years in advance.

superfran_uk

When your fixed term ends and mortgage rates are up at 10, 15%, will you still be able to afford it?

lincroft1710

With larger houses come larger maintenance costs, higher council tax bills, more to heat/light/clean/maintain/decorate. 2,000 sq ft is a BIG house, about twice size of average 3 bed semi.

What may be £250/£300 pm now could well be a lot higher in a year or so's time. Mortgage rates will rise.

You don't mention how much you have saved for a deposit, this will affect your chances of getting higher mortgage.

MMG

According to the bank, mortgage wise its fine. Hoping to fix for 5 years.

There is a smaller house in the same development for approx 40k less, however it is 600 sq ft less with no garage etc, so it seems that for the price difference the bigger one would be the better bet in the long run, and also perhaps increase in value by a bigger amount .

Liz33

How much deposit do you have to put down also, because if you have say 10% for the £200k do you have the extra so you can put down the same deposit level?

£1000 desposible income seems a good amount at the moment left over at the end of the month

superfran_uk

Liz33 wrote: »

£1000 desposible income seems a good amount at the moment left over at the end of the month

Depends how much you start with!

MMG

Combined salary of approx £55k, have about 40k of a deposit for the house. Does this seem completely unreachable?

superfran_uk

MMG wrote: »

Combined salary of approx £55k, have about 40k of a deposit for the house. Does this seem completely unreachable?

That is one hell of a mortgage you'd be taking on. £230,000... I dread to think of the monthly payments - that's almost double what ours will be! And we earn a very similar amount.

I'd say keep looking around, bide your time, and don't fall in love with anywhere and pay over the odds. Or see if you can make a lower offer, get the best of both worlds.

Geenie

Could one partner manage the costs if the other was taken ill, got made redundant or became pregnant and gave up work for a bit? My advice would be to never stretch yourself. It is also good to be able to have money to put away for emergencies, savings etc.

MMG

Geenie wrote: »

Could one partner manage the costs if the other was taken ill, got made redundant or became pregnant and gave up work for a bit? My advice would be to never stretch yourself. It is also good to be able to have money to put away for emergencies, savings etc.

Yes, just about though, with a bit of scrimping!

House was originally marked at near to 450k when the development was due to be released.

Geenie

MMG wrote: »

Yes, just about though, with a bit of scrimping!

House was originally marked at near to 450k when the development was due to be released.

That is quite a drop from 450k to 270k! Is it just the housing market or are there other problems with the build that may need some researching......ie a Nuclear plant going up behind, mine shafts underneath!