How does anyone get onto the property market??

Dave_6

Sad fact is you're right Thrugelmir and it most probably isn't a wind up, poor money management and people living beyond their means.
Have a number of friends my age who have got loans out and now really really regret it, sad thing is they have nothing to show for them either

tyler80

What you're essentially doing is saving up the deposit for a mortgage on the bigger place. If it's, say, £150k and you can only borrow £100k then you need to come up with a £50k deposit.

The friends I know who bought around 1998/1999 moved up the ladder on the back of rising house prices, they didn't save whilst paying a mortgage. They bought, sold for more than double what they paid and put the money towards a new house. House prices in this area have not risen proportionally. Houses at the lower end of the market have increased in price more than those more expensive so rising house prices did not put the next step out of people's reach.

Those friends who bought later not only have seen their houses fall in value, but find that any move is out of reach due to the tightening of lending criteria.

These groups of people in general have made similar financial decisions, the second group are no more responsible/irresponsible than the first. The only difference is the timing of their purchase. Yet from a financial viewpoint the first group are hugely better off. This is mostly luck rather than judgment.

GDB2222

tyler80 wrote: »

The friends I know who bought around 1998/1999 moved up the ladder on the back of rising house prices, they didn't save whilst paying a mortgage. They bought, sold for more than double what they paid and put the money towards a new house. House prices in this area have not risen proportionally. Houses at the lower end of the market have increased in price more than those more expensive so rising house prices did not put the next step out of people's reach.

Those friends who bought later not only have seen their houses fall in value, but find that any move is out of reach due to the tightening of lending criteria.

These groups of people in general have made similar financial decisions, the second group are no more responsible/irresponsible than the first. The only difference is the timing of their purchase. Yet from a financial viewpoint the first group are hugely better off. This is mostly luck rather than judgment.

People need to take responsibility for the timing of their purchase. Prices in 1998 were at or below trend. Prices in 2008 were well above trend. People who buy at the top of a bubble suffer serious consequences. Simples!

puddy

people will buy when they need to buy, not necessarily with 'investment' in mind as its their home

i bought in 97 and sold a couple of years ago for 3x what i paid for it. am i clever? no, i had no idea about the housing market and dips and bubbles and what have you. i just wanted a home.

we have now bought a house in 09, for 136.

immediately a house opposite (we live in a street of identical houses, 1930s semis) sold for 70k,,,, yes 70k. it then sold about 2 months later for 105, it was a refurb but the stats on sold prices wont tell you that.

about 6 months after that, the house next door but one to the 70k property sold for 50k, this had gone to auction, i think it had been let out previously. the pictures on rightmove didnt look too bad to be honest, so i dont know what else was wrong with it

that then sold again almost immediately, i think it was within the same month for 80k. whether this was a couple buying each other out or not i couldnt say.

so the 'average price' for our street now when you look back the past 2 years (our purchase is outside this timespan) is 75k!!!!!!

to put into perspective, next door bought theirs 18 months before we did, so they bought at the end of 07 and paid 168k!!!!!!!!!

are they (or we) bad financiers? no of course not. its just the way it is. im glad ive got a small mortgage though, thats all i can say.

theres a house now for sale on this side of the road, pictures show it in perfect condition, its up for 140-160k. it will be interesting to see what they get

tyler80

i bought in 97 and sold a couple of years ago for 3x what i paid for it. am i clever? no, i had no idea about the housing market and dips and bubbles and what have you. i just wanted a home.

You're confused. You mean you went without shoes and walked 3 miles in the snow to afford a deposit, and carefully considered the financial implications of your purchase. The problem with youngsters today is they want everything without working for it. Fancy today's youngsters just wanting a home, talk about entitlement ;-)

puddy

tyler80 wrote: »

You're confused. You mean you went without shoes and walked 3 miles in the snow to afford a deposit, and carefully considered the financial implications of your purchase. The problem with youngsters today is they want everything without working for it. Fancy today's youngsters just wanting a home, talk about entitlement ;-)

of course, but what i didnt tell you is that saved from all my jobs (from the age of 13) saturday jobs, car washing, baby sitting, had more than one job at any one time, worked all through university, didnt get any help from my parents, lived in bed sits blah blah blah. worked unbelievable amounts of overtime and always had second jobs. now im knackered.



got no pension though

Simon11

I'm 22, living at home and with a £23.5k job in London.

Have £40k saved up through jobs with no debt from uni and £20k gift from grandparents. 2 bedrooms start from around £150k in the local area, with £200k for a nice 2 bed property in a nice area+Garden ect.

Even with £40k in saving, its the salary that is holding me back, not deposit! I can only hope for around £95k mortage loan

I always want to move out as parents are annoying sometimes However atm I'm saving close to £1k a month and if I was to move out, I would spend all my income on mortage+bills ect.

So to get a better place, and be better financially for the longer term, I'm trying to hold back

Its darn hard though

jahudson72

Like Simon I got on the ladder the hard way. I saved, didn't go on flash holidays and moved back in with my parents for six months to save the legal fees. I slept on a campbed til I could afford a sofa, which I slept on til I could afford a bed. Ten years down the line I have a small mortgage as my salary has increased and I've been paying over the mortgage.

It's great moving out of home and going to Uni etc but you never want to move back home - if people today want to get on the ladder they need to start young, make sacrifices, work hard and possibly contemplate living with mum and dad (if they'll have them) instead of wasting money on rent because it gives them "Freedom"

To the OP, patience.

claire16c

jahudson72 wrote: »

Like Simon I got on the ladder the hard way. I saved, didn't go on flash holidays and moved back in with my parents for six months to save the legal fees. I slept on a campbed til I could afford a sofa, which I slept on til I could afford a bed. Ten years down the line I have a small mortgage as my salary has increased and I've been paying over the mortgage.

It's great moving out of home and going to Uni etc but you never want to move back home - if people today want to get on the ladder they need to start young, make sacrifices, work hard and possibly contemplate living with mum and dad (if they'll have them) instead of wasting money on rent because it gives them "Freedom"

To the OP, patience.

I didnt start renting after uni for freedom I did it because there isnt really enough room in my parents house for me, them and my boyfriend - now husband, and I dont think it would be fair on my parents to do that to them now they finally have their house to themselves after myself and my sister have grown up and they didnt either. Most people I know went back home for 2-3 months and then moved out because they pretty much had to. Not all parents want their kids coming back.

Also lots of people move out because they have to move somewhere to get a job. Renting isnt always a preferred choice.

claire16c

Dave_6 wrote: »

Another FTB here, in the south east, ages 27 + 24, joint income of 38k so hardly big earners

We are just buying a house, offer accepted at 155k, 24k is our deposit and 131k mortgage
It’s a 3 bed semi. (5k of the deposit was a gift from my Dad)

We both have cars but they are worth 4k each & have done under 50k miles, nothing too special but they are reliable. We go on 3 holidays a year but we’ve always saved up for stuff we want, not borrowed.

We haven’t had children yet and haven’t had loans or finance on cars,

After the story in the papers this week about trolling + then seeing your post and signature I’m almost tempted to say the OP is a wind up


I’ve always said I wouldn’t have kids until I owned a house, mainly because I knew that if I had them then I’d struggle to save to ever buy

You must live in a very 'cheap' area of the south east. The 1 bed maisonette across the road from me just sold for £130k and it needs new bathroom and kitchen and is tiny. Youd never get a 3 bed semi for that price round there.

Infact my parents next door neighbours just sold their semi and it went for £249,999 and that was a 3 bed. So thats the type of price I have somehow not only got to save a deposit for, but also be able to get a mortage big enough for based on our salaries.

So then as that gets delayed in time, you realise you only have x no. of years left to have kids, and thats why people end up having kids before buying a house, then needing more bedrooms, so then they need a bigger deposit etc. It can go on and on.