Millionaire Challenge

lessonlearned

Kitten - I wrote you a proper reply about the government scheme and it's possible effect on the housing market. However, I had to dash off because I could smell the potatoes burning and lost the reply.:rotfl::rotfl:

Too much multi tasking obviously......

Will try again later.

Laters .......

lessonlearned

Kitten - I think you could well be right - this latest government initiative could well jump start house prices.

In fact this is why I am so keen to help my boys out.

As I understand it the new build part is already in place, with the help for "pre-loved" properties coming into play next January.

As I mentioned in my last post I have been seeing brokers this last couple of weeks. The good news is there are plenty of good deals for 10% deposits. Until fairly recently you had to be finding 15 or even 20% to get a hope of a mortgage.

Obviously the higher the deposit then the better the deal you can get and the lower the interest rates. Realistically though these amazing deals don't kick in until you have 25% at your disposal and there can't be many FTB's in that happy position.

So I think there are two choices here.

1. Carry on saving for a bigger deposit to grab the best interest rates and hope that house prices don't soar.
2. Go with a 10% deposit (assuming of course that you can get that together) and buy now, hoping that interest rates don't soar.

It is impossible to forecast where interest rates might go, however you can fix them for a few years to give you some stability.

I have lived and worked as an EA through previous "Mortgage Famines". In every case as soon as borrowing restrictions were relaxed and the money started to flow again then house prices rapidly climbed again.

I think there is currently a great deal of pent up demand - many renters are desperate to buy but high deposits and the banks unwillingness to lend have been a real stumbling block.

We are now in the ludicrous position where people can comfortably afford rents and yet cannot take out a mortgage which can often be several hundred pounds a month cheaper.

If we look at the new government guarantee schemes then together with the proposal to help with deposits and the general loosening of lending criteria that I have mentioned, then I am pretty certain that house prices are set to rise quite sharply and quickly.

Judging by the pent up demand I can envisage the flood gates opening. The next "housing bubble " could well be a monster.

I would advise anyone who has some deposit money available to them to start thinking very seriously about buying sooner rather than later, preferably this year.

Start looking out for the 10% deals. They are not confined to "dodgy lenders" - even the high street banks have them now.

Although I can probably buy outright even I am looking out for a small mortgage.

Why not - as all the gurus tell us we should use the principles of OPT and OPM to help us on our quest to financial freedom.

Other People's Time and Other People's Money. OPM is about making the banks etc give us money so that we can then invest it.

For all the highs and lows of the property market I still believe that bricks and mortar are one of the best investment anyone can make.

Investing in your own home is more than just about money though. It's also about security of tenure and being "lord or lady of your own little manor", being able to do what you want.

An Englishman's home is his castle and all that.

To me owning my own home is at the core of financial freedom.

lalapalooza

saphydog wrote: »

. Friends call me tight :-D, il re-use a postage stamp if it hasnt been franked.

I reuse my green tea lemon t-bags two or three times as they are not cheap!

ElleWoods

Lesson, I'm in that place you mention where I pay more for rent than a mortgage on the same size and type of property would cost. I pay £500pcm rent. A colleague of mine has a very similar property and pays £375pcm mortgage. However her parents helped her by loaning/giving her the deposit (not sure which) but unfortunately mine aren't able to do that.

I wish I could buy, I really do, but I don't have the deposit to do so. Of course interest rates could rise and, as discussed on this thread, there are other costs associated with home ownership so it's not just down to the monthly repayment but taking that in isolation, it's very frustrating. If prices rise further, as a single buyer I'll be priced out of the market altogether.

lessonlearned

Oh dear Kitty - how frustrating for you. Perhaps this new scheme may be able to help you with your deposit.

I would imagine you are just the kind of person this scheme is designed to help.

I really don't know enough of the details to advise you, but I am sure there must be some info out there by now. I may be wrong but I seem to recall that the buyer would need to put down 5% and the government would top up the deposit. ??? I believe the top up takes the form of an interest free loan, with payments deferred for 5 years.

Don't quote me though. Perhaps one of the govt websites might have posted up some info by now.

Perhaps if you posted the question on the Housebuying Thread someone could point you in the right direction.

TBH my boys would not be able to even look for houses without me helping them out.

It is very very tough for young people to get on the housing ladder.

Have you considered shared ownership at all. There are pros and cons of course, and you would need to do "due diligence" but it might be worth looking at.

citizenkitten

LL - thank you for such a level headed common sense language reply. this has helped un muddy my thinking on this subject.

as you all know, I have one wedding to fund so got to do this before anything else. When we find out more details of how much our wedding will actually cost I think we shall crack on to find some brokers.

after all you need to know what you can and cant do.

lessonlearned

Have you set your wedding date yet.

I notice from your signature that you have set yourself a budget of £3500. Can I just say how impressed I am.

Apparently the "average spend" on a wedding is around the £25K mark. Madness. :rotfl:

I am sure that your wedding will be just as lovely and ......you won't be getting yourself into debt paying for it.

Clever girl.

lessonlearned

Good morning all

Well I've hurt my back again so that's the next few days more or less cancelled. So frustrating.

So I shall use the time to do some reading and research. I'm going to pluck up courage and have a go at matched betting. Will have to really do my homework first though because I am completely clueless.

citizenkitten

lessonlearned wrote: »

Have you set your wedding date yet.

I notice from your signature that you have set yourself a budget of £3500. Can I just say how impressed I am.

Apparently the "average spend" on a wedding is around the £25K mark. Madness. :rotfl:

I am sure that your wedding will be just as lovely and ......you won't be getting yourself into debt paying for it.

Clever girl.

yes it is sep 20 - on our 8year anniversary. it was the day we met and i am terrible with remembering dates etc so we decided we couldnt think of a better date and it was going to be this date come rain or shine.

but this is now where i get embarrassed lol - that is just MY part of the wedding fund. Our wedding will not however cost 20 grand....

i know people say - it is your wedding do it your way, and if it truly was up to me then my wedding budget would be just 3.5k and would be just us in vegas and then spending the rest on a glorious holiday. and if it was my other half's wedding it would be just a church ceremony and a long holiday. BUT I/we have certain duties to fill, for us the wedding is our duty, the marriage is for us. I dont expect many people to understand my position but then it is extremely unusual.

but I dont regret how my wedding will hopefully turn out and how much will get spent on it, no matter what, i am sure it will be one of the best days of my life to marry the person i love. Money can be replaced and enjoy the ride for what you can get out of it.

sorry to hear about your back LL - rest up.

droopsnoot

lessonlearned wrote: »

I'm going to pluck up courage and have a go at matched betting. Will have to really do my homework first though because I am completely clueless.

I keep trying to motivate myself on this one, too. I even signed up and paid for a service that will tell me exactly what to do and how to make 'cannot lose' opposing bets. But I am still persuading myself to make that first move. I've sat down and worked through the examples and convinced myself it's not a scam, the numbers do actually add up, just somehow feels wrong and I have to get over that feeling.