House Prices Simply Too Expensive For The Young

B_Blank

julieq wrote: »

If you have 60% loan to value to buffer falls, who do you think you are protecting? You, or the lender?

You'll get repossessed just as quickly if you fail to make payments on a house you own 40% of as one you own 10% on. I wouldn't argue against offsetting savings, but I wouldn't be sinking money into bricks and mortar, especially if I believed it to be likely to fall in value. Worst case you get reposessed, are forced to sell at a discount, and lose the value of your equity. Keep it in cash and you can use it to support yourself for a considerable period.

This is true actually. It is good to diversify between being a borrower and a saver.

Out,_Vile_Jelly

FTBFun wrote: »

Sure. You've actually got a bigger deposit than I had.

85% LTV

http://www.rightmove.co.uk/property-for-sale/property-26696584.html

http://www.rightmove.co.uk/property-for-sale/property-27590653.html


I live nearby so can vouch for its safety.

Er, thanks. I don't earn £90k though. Not many people in Education do.

the_flying_pig

That [post 167]’s a heck of a generalisation, H.

Everyone’s different.

For example my own pre-owning days [or rather years, there were about 26 of them IIRC] were spent between sponging off parents and living in very, very, cheap HMO-type setups – my personal contribution to rental yields, at today’s prices, would have averaged around one percent p.a. at most. Anyone in a similar position today would benefit hugely by waiting for even relatively small nominal falls.

Similarly I’m waiting again now, to trade up, with my FTB mortgage being fully paid off [my total deposit for new place will probably be around 60%] I’m living rent & mortgage free, putting aside a decent amount every month, & would obviously stand to benefit hugely from waiting for nominal falls.

ILW

Out,_Vile_Jelly wrote: »

Er, thanks. I don't earn £90k though. Not many people in Education do.

Why would you need to earn £90k to buy a £200k place?

Pete111

ILW wrote: »

Why would you need to earn £90k to buy a £200k place?

Hmmm hope the're not a Maths teacher...

Cyril

Pete111 wrote: »

Hmmm hope the're not a Maths teacher...

Hmmm hope you're not an english teacher

Out,_Vile_Jelly

No, I'm not a maths teacher, but I thought mortgages were 2 or 3 times your salary. 2 x £90k gives you £180k, then the £35k deposit takes you up to the asking price of £215k. Perhaps I am confused as to how the deposit enters the calculation.

Although if I were going to spend over £200k on a flat it wouldn't be in Peckham.

ILW

Out,_Vile_Jelly wrote: »

No, I'm not a maths teacher, but I thought mortgages were 2 or 3 times your salary. 2 x £90k gives you £180k, then the £35k deposit takes you up to the asking price of £215k. Perhaps I am confused as to how the deposit enters the calculation.

Although if I were going to spend over £200k on a flat it wouldn't be in Peckham.

As a teacher you should be able to get at least 3.5 x salary.
If the area is not good enough for you, that is a different matter though.

Out,_Vile_Jelly

ILW wrote: »

As a teacher you should be able to get at least 3.5 x salary.
If the area is not good enough for you, that is a different matter though.

I'm not a teacher; I work at a university. 3.5 times my salary plus 35k deposit gets me pretty much nothing in London- that was sort of my point. My job is secure and has benefits other than pure salary so it is not simply a case of "get something better then".

I think those SE15 flats are overpriced because although East Dulwich is trendy and nearby, the overland train service is pretty rubbish. I think you can get better value for that sort of price in London.

ultrawomble

GHOULS_OWN_NOTHING wrote: »

it's the overtly restrictive banks lending practises.

Care to tell us why that is?