Getting on the Ladder

heather123_2

Ah, he has the deposit! Probably why I'm not too keen on him having to get another job to fund my expensive hobby!!

Do you really think his £600 and my £350ish is enough to run a 3 bed house?

lynzpower

why do you guys need a 3 bed house?

do oyu have kids now?

lisyloo

Do you really think his £600 and my £350ish is enough to run a 3 bed house?

OK, I think this is the first time that a 3 bedder has been mentioned.

Personally without wishing to cause offence I think your expectations are very high for lowish salaries in a quite expensive part of the country.
I think that ringo is right and you need to do some hard thinking.
Why do you have to have a 3 bedder? Most people starting out go for something much smaller (although it's not great I agree but this is what people usually have to do).

First thing you need to do is work out an SOA (statement of affairs).
A bit like you did in an earlier post but more detailed i.e. I think you need to include essentials like food.
If you run your own home, you will need to include council tax, food, utilities (gas, electric, phone, broadband, water), also house insurance (buildings and contents). You should be able to find out what these cost from friends and family with similar size houses.

Also be aware that you will need a lump sum for stamp duty, removals, legal fees etc. and any furnishings you will need (which could be a lot if you currently live at home).

My list for ongoing costs is :

mortgage
pension
existing loans
food
water bill
gas
electricity
phone
broadband
house & contents insurance
council tax
clothes
glasses/contact lenses
dental costs
holidays
entertainment
presents (birthdays, xmas)
any insurance you might need (life, sickness, accident, redundancy)
furniture
house repairs and maintenance
mobile phone
car insurance
car tax
car MOT
car recovery
car repairs & servicing
horse costs (don't know how these break down)

Then you need to decide what you can afford.

My gut feeling is that 2 people on £20K salaries cannot afford a 3 bed house in Guilford plus a horse (and at least one car).

Do you really think his £600 and my £350ish is enough to run a 3 bed house?

Sorry to sound harsh, but quite frankly no.
See my list above for all the costs you need to take into account.

You need to detail your affairs in much more detail so you understand how much you have left (your earlier list left out a LOT of stuff).
Then once you have the figures to hand, you need to decide on your priorites.

Do you need a 3 bed?
Do you need a private car or could you move (for example) close to a railway station? or close to where one of you works?
Could you share a car to save expense?
Could you stay with parents for longer whilst you save up?

Sorry if it sounds harsh but I think you think you need to do this and ask these kind of questions.

heather123_2

No, but a 4 year plan! And I don't see the point in paying money for a smaller property which we would have to pay to move from (removals etc) in a couple of years time when we might as well not move anywhere and save that money... I don't think the market in the area is going up at the minute so I can't see us making much profit from buying something smaller and moving in a few years anyway.
I don't really get on with my parents either and I want to move out - its just difficult to find the money to get what we want... Well, difficult for me! I think the answer is going to have to be that he pays more than half to start with?

lynzpower

I don't think the market in the area is going up at the minute so I can't see us making much profit from buying something smaller and moving in a few years anyway.

With respect love, thats not the point. The point is, would you be able to afford to pay for it? Answer, probably not, as you yourself say you just about break even now.

there are few things you need to consider.
1. Your income multiples. its usually 3.5 your joint income ( altohugh some lenders will go higher on affordibility, but you sohuldnt really overstretch yourselves, as you will end up in the poo) Which will give you a budget of 140 to buy with.

2.a quick look on rightmove shows the cheapest 3 bed place is 187k. The repayments on this per month mortgage only on a conservative estimate of 5.5% ( there are some cheaper products about, but this is about what many offer) is repaying at 1164.83 pcm. Clearly the higher the deposit the less the monnthy payments would cost you.

3. you need to factor in buildings & contents, life cover, repairs etc on top Buildings & contents & life cover for me is about 75 per month, Id expect to double that for you guys as a couple. So a further 150 per month on top.

4. of course there are umpteen costs for moving such as stamp duty, sols fees, searches etc, which you would need to price up as well.

these are of course of the top of my head figures, if you want a mortgage, best to go to a broker and see what you could get.

heather123_2

Lisyloo I think you are right - I didn't go into more detail in my earlier post because I don't have a property or those kind of out goings at the moment. We could afford it if we pooled our money and my partner paid the mortgage and I paid bills and food plus we would have "emergency" money.

Also, furnishings aren't a problem as he had a property before (ex g/f) and still has the furniture.

A 3 bed in the areas we are thinking would be around £200k. A car where we want to be is essential, and we would both be close to work so maybe cost of petrol would go down. Although I wonder if we hanged for a few months... my job is such that if I was to move in a year I could earn quite a lot more money.

Your not harsh... just realistic!!

lisyloo

No, but a 4 year plan!

If this means that you intend to have kids in this period then obviously you need to account for the additional cost of feeding, clothing and entertaining them on top of the loss of one income (probably - but you don't enough to cover a nanny or child care).

And I don't see the point in paying money for a smaller property which we would have to pay to move from (removals etc) in a couple of years time when we might as well not move anywhere and save that money...

I agree with you that transactional costs on properties are high.
However it's not only about running costs, it's also about gettting a mortgage.
My guess is that you won't be able to get a big enough mortgage for this size of house in your area.
You can go on to some lenders webites and see how much you can borrow from their calculators and then see what type of house you can afford.
My feeling is that you will unfortunately be very dissapointed.

I don't think the market in the area is going up at the minute so I can't see us making much profit from buying something smaller and moving in a few years anyway.

This brings up another point.
House prices are relatively very high at the moment.
There is a chance of falls.
So whilst no-one here can predict the future we can say that the risk of falls is higher than at other times.

There is a graph here from which you can try and predict which way prices could go.

http://www.housepricecrash.co.uk/

I don't really get on with my parents either and I want to move out

Have you considered renting? It would avoid most of the buying/selling costs.

its just difficult to find the money to get what we want...

That's because you can't afford it.

I think the answer is going to have to be that he pays more than half to start with?

It's quite possible to have an uneven split.
It doesn't have to be 50/50.
On the deeds of the house you could own 33% and he could own 67% (or whatever numbers you like).
BUT I would still question whether you can afford it together.

Have you looked at mortgages or house prices?

seek_2

imo you should really get rid of the horse think about it for a second your letting a horse say what type of lifestyle you can have.

lisyloo

Also, furnishings aren't a problem as he had a property before (ex g/f) and still has the furniture.

So all the curtains in his last house, will fit the size of all the new windows in your new house precisely? and you won't have to purchase a thing :-))

I used all my curtains on my last move.
Admittedly it was to a 5 bed house, but I spent £2K and I didn't have anything particularly fancy.

heather123_2

I feel like ripping my hair out now!! Its a hell of a lot to think about - your all right, I don't think we can afford it! We (royal we) would have a deposit so could look at things at about £200K and there's always a plan of how much everything would cost, but its the same if I work out at the moment what I spend - even if I do it to the penny from the last few bank statements I always seem to spend more than I think! I lived with someone before (who was a lazy **** and didn't pay his share) but we struggled with a £500 a month rent plus bills etc... Hmm... thinking / planning time I think! Thanks so much for all your help and advise - I will spend some proper time looking through and working out more exactly!!