FTB - Should you stretch to buy the best available?

Catblue

Totally fine to buy an expensive house - if you've got the money.

You don't unfortunately. You are putting yourself in horrendous hock for years to come when there is simply no need to. Buy a cheaper house that is cheaper to run, maintain and furnish. You'll sleep better at night.

You might have horrendous neighbours/split up/move jobs/become ill/whatever and need to move sooner than 15 - 20 years.

And if, as you say, the houses have already dropped 40% on that estate then it might not be the highly desirable place that you initially think it is.

MMG

Thanks for the input so far. I guess I'm basing it on the fact that the minimum price range of house I'll be buying will be approx £200k. Over the course of a 25 year mortgage that makes a difference of approx £350 per month.

I am still in two minds whether or not it's worth the extra bit now, so that a truly long term home is purchased..

Catblue

MMG wrote: »

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 .

And also decrease in value by a bigger amount if the market continues to slide?

Just make sure that you do your budget very precisely. Will you really have £1K disposable income left over between you every month?

Have you factored in petrol, car buying, maintenance and insurance, TV licence, phone, mobile phones, broadband, council tax, house insurance, electricity, gas, water rates, etc? There are budget planners galore around this site if you want to use them. Remember that bigger houses will cost more in council tax, heating bills and maintenance.

Even if you have factored in all of the above and you do have £1K disposable income between you each month, that gives you each £125 per week for everything else such as food, clothes, going out, holidays and buying stuff to furnish the house. And presumably you'll want to build up some savings out of this £125 per week each.

And then if you decide to have kids, your budget will be even tighter with reduced money coming in and/or childcare costs.

Don't mean to be on a downer but if you do go ahead with this, you have to make sure that the figures are exactly right.

Geenie

MMG wrote: »

At the moment, we are renting and have beds/sofas/drawers/electronics etc. All the basics. All would be needed would be the tiling, and carpeting/flooring to some of the essential rooms to begin with.

Would like to keep a buffer of say 5k saved for a rainy day in case something were to go wrong.

Appreciate the comments/replies.

I would want more then 5k as a buffer.

ess0two

MMG wrote: »

Thanks for the input so far. I guess I'm basing it on the fact that the minimum price range of house I'll be buying will be approx £200k. Over the course of a 25 year mortgage that makes a difference of approx £350 per month.

I am still in two minds whether or not it's worth the extra bit now, so that a truly long term home is purchased..

Go for it, if you listened to half of it in here,you'd never do anything.

Too many if,but,what ifs to be concerned with.

charliee_3

my parents in law bought a house outside their means about 22 years ago because they fell in love with it (new build), they had 3 kids and then the mortgage rate went up to 20% or somesuch ridiculous figure.. he got made redundant, but they still made it, he was working 2 or 3 jobs to pay for it, coming home from one and going out again to work nights and she was working too, but they recently sold up for lots of dosh and moved to france.. it was really really hard at the time, but they loved that house and made it work when they could have given up..and it got easier again...

i suppose it doesnt help much, but i just thought it could be your story if you want it enough, but it might not be easy going.....

good luck!!

toby3000

If I loved a house I'd stretch myself- but is it really this house you love? Aren't most new builds quite samey, other than size/location? Do you really need 4 bedrooms right now?

I moved into a flat I couldn't really afford and have spent 6 months stressing about money, and it's really, really horrible.

On the other hand, £1000 seems alot of disposible income. Do you expect to have been promoted in 5/10 years? What's a struggle now could be affordable by then

DiggerUK

MMG,
I'd never advise anybody to stretch themselves thin in the boom, let alone now.
Look at the problems the developer has got themselves into. They seem stretched to me.

Dropped from original price to what it is now! Says a lot.

Best to view it like clearance offers in supermarket, they're cheaper than normal, but they will still be selling at a profit.

Have faith that the developers banker will be helping you. The developer will have incurred debts to build, the bank wants repaying. There is every chance that the developer is more desperate to sell than you imagine.

Prioritise what you can afford, not what you want, and remember it's a buyers market.

Best of fortune.

SUESMITH_2

like everyone says fine now but when the rates go up which im sure they will - we had a mortgage when rates were at 15% or something horrid - we cut back and lived on beans on toast and no going out, our friends wh o had stretched themselves had to try and sell cos they just couldnt afford their payments