Deposit +?

bodmil

Hello all,
I'm a FTB in the very beginning stages of thinking about buying! I earn approx 33k and have used the calculators and get an average of 125k quote for a mortgage. Having had a browse on rightmove it seems I will need a minimum of 170k to get a decent place where I want to buy, so I am budgeting to save for a deposit of 45k.
I am then a little iffy on the extra figures required... So far from reading posts here I am suggesting - 3k for costs (survey/solicitor etc), 5k for furniture and start up bills as I get settled, and I would like 5k in a savings account and 1k in my current account as a minimum always.
So 59k, I like round figures and to over estimate so 60k to my name before I make any move.

Can I hear a collective gulp?

I do like to over estimate but am I wildly off the mark with any of my figures? Could I perhaps cut a few months off the expected time to purchase?

Fire_Fox

Why do you need £5K for furniture? Surely you have many items already, you could get freebies, second hand or IKEA best to begin with for loss than £1K. Also what is your £6K float for? I don't mean that you shouldn't have savings (in fact I applaud you), but I do think sometimes people save for a 'rainy day' that never really comes!

Assuming you have a full structural survey plus recommended electrical and heating checks, you should not get any nasty surprises before you have chance to save up again. I would certainly say you need three months mortgage payments, as this is the period between you needing benefits and support for mortgage interest kicks in. If you do not have children it is only your lifestyle that will be affected by, say, a redundancy and you can always live like a hermit to ensure the mortgage is paid!

If you are looking at a two bedroom or above for just you, there is always the option of taking in a lodger should money become tight. The income is tax free up to just over £4K so could be used to quickly replenish savings if you so desired. Matched betting (NOT gambling, see Loopholes board) is another good way of bringing in tax-free income quickly.

bodmil

Thanks very much for the swift reply!
I really don't want cheap furniture. I am happy to make do with borrowed/very cheap stuff for non-essentials and buy proper stuff as I go along. I suppose 5k is for nice bed, cooker, microwave, hoover etc, all the start up stuff. I've only ever rented furnished rooms or lived at home (I've not been out of uni long) so I have nothing of note to bring with me.
6k float is just something I'm used to having I suppose. I currently have a dodgy car so it would either go on that or a new one. After seeing what is relatively heeeaps of money in my account at the moment I think I would panic like mad if I had any less.
I am getting a 2 bed with the particular reason to have a lodger but I'm likely to be picky; I'd rather have no one than a plonker so I won't rely on that income just yet.

Perhaps I'll do a bit of non-Ikea internet window shopping to get a better idea of furniture costs. I do feel like I'm being overly sensible, but I hope that's a good thing?

maninthestreet

How much deposit do you currently have saved? Even for just £45K, it's a lot of money to save- even if you could save £1000 a month, it would take you almost 4 years.

bodmil

I have 29k in total (including 6k float). I save on average 1.5k month, but try (more so from now) to exceed that significantly. You're right, I currently expect it to take me until the end of next year, hence joining this website; I've never really looked at my outgoings before and could definitely crop a lot.

overandout_2

bodmil wrote: »

I have 29k in total (including 6k float). I save on average 1.5k month, but try (more so from now) to exceed that significantly. You're right, I currently expect it to take me until the end of next year, hence joining this website; I've never really looked at my outgoings before and could definitely crop a lot.

Congratulations on managing to save at least 1.5k minimum. May I enquire how you manage to do so on a 33k salary?

As a MSE, I would like to see whether there's anything else on my expenses can be minimised.

bodmil

By working away from home where all my expenses are covered and time off is spent sponging off Mummsy. :beer:

PasturesNew

£5k for furniture etc. I'm old enough to be your mum and I've never had that much furniture/stuff.

You really don't need anything like £5k's worth. Free or cheap doesn't mean rubbish/naff. Look at it this way .... if 6 months into house ownership you lost your job, would you rather have £4k in the bank to fall back on, or would you like to be job-hunting whilst sitting on a leather suite, drinking freshly made coffee from your top of the range bean-grinder/roaster .... but with £0?

PasturesNew

overandout wrote: »

Congratulations on managing to save at least 1.5k minimum. May I enquire how you manage to do so on a 33k salary?

I'd have thought the answer would HAVE to be "Oh, I set that aside from this month's pay cheque". £33k is a monthly take-home of £2057. I know if I were earning £33k and renting privately alone and paying all the bills myself and running a car to get to/from work up to about 20 miles away I'd still be able to save £1k/month.

verytricky69

You could afford to get a £170k property now with a 15% (£25,500) deposit. and money left for fees.

Though it'd be more sensible to save a bit longer (while you can) to get a bigger deposit=better interest rate.

We've gone for the ikea route- that way when you get bored (as fashions change) you can change the look of your place by buying a whole new batch without feeling too guilty!

I think we'll go for expensive furniture when we are older and are in 'the forever house' However we did spend a fair bit on a big fat tv!

overandout_2

PasturesNew wrote: »

I'd have thought the answer would HAVE to be "Oh, I set that aside from this month's pay cheque". £33k is a monthly take-home of £2057. I know if I were earning £33k and renting privately alone and paying all the bills myself and running a car to get to/from work up to about 20 miles away I'd still be able to save £1k/month.

Not if you are working in London. I work in central London and have stayed in a Zone 6, 1 bedroom flat + transportation (just a railcard).....would have cost me around £750.....I haven't even counted utilities yet...

I have friends that rented a spare room with all utilities included (Zone 3) + transportation would still cost around £500....

And that's not inclusive of food and any other basic necessities....

London is just expensive....