Tighter lending rules mean 10-year wait for first-time buyers

davilown

MoneyMiser wrote: »

Exactly, the Yorkshire Bank is offering a 95% LTV mortgage. The rate is 6.99% for three years which isn't great but FTB's should know that their first home will not be their dream home, mereley a step in the right direction.

As a FTB myself, this is what I am looking at doing the the near future.

MM

Why should FTBs just be looking at the bottom of the ladder? I'm a FTB but I'll be buying a four bed semi/detatched house when I buy.
Why? Because I'll save a 25-30% deposit to be able to afford to buy it. £50k in 2-3yrs means no holidays, no new car, no new phones, no new computer etc.

As to Raggs suggestion that 5% is enough for a deposit, thats mad advice in the current climate where there is so much uncertainty in jobs as well as house prices.

davilown

IveSeenTheLight wrote: »

It's quite refreshing to see a FTBer with such an understanding and realism of what is required tobe a homeowner.

somone who doesn;t just expect it to happen or for it to be handed on a plate to them.

Well Done :T

So perhaps they should just give the banks more of their hard earned money instead of saving for the extra year in order to lower the IR?:eek:

chucky

davilown wrote: »

Why should FTBs just be looking at the bottom of the ladder?

they shouldn't they should be looking at what suits their circumstances, family etc... taking into account what they can afford too.

the benefit of the last couple of years has been that people can skip a rung or two from this mythical housing ladder. i can't see them getting another good opportunity like has happened in the short or even medium term.

there maybe smaller windows of opportunity but not as good as 2009.

Raggs_2

davilown wrote: »

Why should FTBs just be looking at the bottom of the ladder? I'm a FTB but I'll be buying a four bed semi/detatched house when I buy.
Why? Because I'll save a 25-30% deposit to be able to afford to buy it. £50k in 2-3yrs means no holidays, no new car, no new phones, no new computer etc.

As to Raggs suggestion that 5% is enough for a deposit, thats mad advice in the current climate where there is so much uncertainty in jobs as well as house prices.

OK, the current job climate is a bit of a risky one, but 95% LTV mortgages are available. And not all jobs are at risk. And 5% is !!!!!! all.

As for fluctuation in house prices, the 95% is only risky if you are intending to move again in the next 5-10 years. If not, you have plenty of time to overpay, and for house prices to normalise. Fine, they will have to pay more in interest, but they can get on the ladder, and the topic is about them getting on the ladder, not getting in at the middle.

FTB shouldn't be looking at the bottom of the ladder, however to claim that it takes them 10 years to get on the ladder is crazy, as you yourself show. 3 years for 50k, for a 10-15% on a good property. I'd bet you could afford the 100k property in 6 months, not 10 years.

@Iveseenthelight. Coming on this board to browse the green and ethical got me to saving cash at the debt free wannabes (only debt I have is student loan, but they're good habits), and then to mortgage board. It made me realise if I want my own house I have to work at it now, for it to become a reality in 4/5 years time. OH is thankfully also aware that this is the situation.

davilown

Raggs wrote: »

OK, the current job climate is a bit of a risky one, but 95% LTV mortgages are available. And not all jobs are at risk. And 5% is !!!!!! all.

As for fluctuation in house prices, the 95% is only risky if you are intending to move again in the next 5-10 years. If not, you have plenty of time to overpay, and for house prices to normalise. Fine, they will have to pay more in interest, but they can get on the ladder, and the topic is about them getting on the ladder, not getting in at the middle.

FTB shouldn't be looking at the bottom of the ladder, however to claim that it takes them 10 years to get on the ladder is crazy, as you yourself show. 3 years for 50k, for a 10-15% on a good property. I'd bet you could afford the 100k property in 6 months, not 10 years.

@Iveseenthelight. Coming on this board to browse the green and ethical got me to saving cash at the debt free wannabes (only debt I have is student loan, but they're good habits), and then to mortgage board. It made me realise if I want my own house I have to work at it now, for it to become a reality in 4/5 years time. OH is thankfully also aware that this is the situation.

I think one of the biggest problems is knowing what jobs are the risky ones. I believe that all public service jobs could be viewed a risky, banking always remains a risk whilst they sort their books out, leisure industry could be hit in some ways but gain in others ie increase in people holidaying in the UK etc.

As to the comment about working hard - its so good to see this ethic making its way through those I know! makes life easier when you're not trying to keep up with those next door!

davilown

chucky wrote: »

they shouldn't they should be looking at what suits their circumstances, family etc... taking into account what they can afford too.

I think that this is the main point - what they can afford. there are still some on here that believe you should be buying a 1/2 bed flat if you're a FTB! My kids would kill each other by nightfall of day 1:D

FTBFun

davilown wrote: »

I think that this is the main point - what they can afford. there are still some on here that believe you should be buying a 1/2 bed flat if you're a FTB! My kids would kill each other by nightfall of day 1:D

Its all to do with personal circumstances really! I'm an FTB buying a 1 bed flat, but I don't have kids nor am I married, so not really a problem yet.

Harry_Powell

davilown wrote: »

I think that this is the main point - what they can afford. there are still some on here that believe you should be buying a 1/2 bed flat if you're a FTB! My kids would kill each other by nightfall of day 1:D

There are some others on here who would say that perhaps you should have bought a house before having kids? They might add that even birds build a nest before laying an egg.

neverdespairgirl

treliac wrote: »

Two points:

• How many have rich parents? Not a huge number I'd guess. Far too many middle-aged parents are still struggling with their own mortgages.

• What's wrong with having to save for a deposit, prove affordability and waiting to buy with more confidence of being able to service the debt? It's the way things used to be done and they used to work fine.

Even those of us who do have well-off parents might very well not tap them for cash, too!

PasturesNew

davilown wrote: »

Why should FTBs just be looking at the bottom of the ladder?

Well ... I think the clue is in there somewhere. If FTBs aren't buying at the bottom of the ladder, who is? It's called the bottom of the ladder (er, ponzi) because that's where you start out.

You're theoretically then going to meet Mr/Ms Wonderful, who will also have such a place of their own, you'll both have fabulous careers and progress, with oodles of dosh coming your way and then you decide to sell both your bottom of the ladder places and buy into suburbia, where you can produce offspring.

On the other hand, if you never meet Mr/Ms You'll Do, you'll stay on the bottom of the ladder (ponzi).