Advice on buying a new build apartment!

GlynD

I disagree. Take the plunge. Best investment you'll ever make. It'll take 4-5 years before you start to see a return on your money but it will come.

T-faz

Thank you for all your replies, please find my answer to your comments as follows:

If you are looking for 95% on mortgage, that is over £128k. This will cost you far more than £600 a month. You might need to adjust your expectations.

You'd be looking at a minimum of £750 a month I expect but more than that you'd be borrowing a lot compared to your income.

I have calculated the monthly costs according to the most attractive NewBuy mortgage deal. Natwest offers a 2 year fixed 4.79 per cent (previously 4.29%) which will cost £613.29 per month.

I will apply for this mortgage deal to see if my application is accepted.

Can you buy an older place with a friend?

Don't like older places, I have seen a few and I was put off by the horrible condition they were in.

As for buying with a friend, not possible as none of my friends are financially stable. Even if they were, I wouldn't want to share a house with a friend.

I don't have a partner either, I would like to have one but that is another story. Ideally, I would like to settle down after acquiring my own place, and this would help me gain a personal place to act on this plan.

Basically I want to make it all work by myself for now.

new builds are overpriced, small, usually of poor quality and you are very likely to lose money on your investment.

What doesn't lose money the minute you purchase it?

I understand negative equity but its true for any purchase. The good thing about these flats is that they are going for high monthly rent.

Have you ever lived in a "small" 1 bedroom "apartment" ? - if not, why not rent one for 12 months to see if you like it ?

Yes, I have.

I was brought up in one and I am accustomed to living in a small apartment.

Why are you so interested in this house/apartment ?

I want my own place, and this fits my requirements very well. It is also close to where my parents live, and this would help me reduce some costs.

I do not want to waste money by renting a place, and rent can be substantially high in London.

This is a ground floor apartment so it has a small garden space and its the closest thing to a modern house that I would like to have in the future.

You don't say what your current circumstances are or where you live now.

I rent a shared room and spend some time in my parents house too. Neither is ideal as I do not have any personal space and I have to sleep in dreary conditions.

I will continue to spend time with my family even if I've bought this space.

One bedroom limits market when you need to resell.

I might not want to sell this and perhaps rent it out or have my parents live here.

2 bedroom and 2 bathroom would be much better

A 2 bedroom apartment would be considerably expensive and this would result in high monthly mortgage payments. I risk great financial difficulty with anything priced higher than this apartment.

SAVE, SAVE, SAVE and wait for a while

A similar apartment to the one I want to buy will be completed by this December and that gives me time to save.

geoffky

Dont do it..buy a proper house... have room for the future is a good saying...

Mobeer

I actually like new builds so won't discourage you there. The builder will expect (probably) some negotiating; you don't have to pay the advertised price. A discount would help reduce your loan to value too.

A 95% mortgage would worry me though.

kingstreet

Ordinarily in today's climate, lenders like Halifax (80%) and Nationwide (75%) are restricting lending on newbuild flats to reduce the risk to them.

You should take this as a good guide. They don't want to lend more, so you should approach borrowing more than that very carefully.

NewBuy means a lot more for builders than it does for you. It means they can stick difficult to sell property in the scheme and make it attractive and the lenders will lend on it because they get repossession protection from the government fund.

Approach this very carefully. You can have your pick of the whole housing market with just 5% extra deposit.

Acc72

GlynD wrote: »

I disagree. Take the plunge. Best investment you'll ever make. It'll take 4-5 years before you start to see a return on your money but it will come.

To the OP - as this is the only post that you have "thanked" I guess that you have already made up your mind ?

I am not really sure what is going to happen in 4-5 years time but good luck.

Chimpofdoom

Acc72 wrote: »

To the OP - as this is the only post that you have "thanked" I guess that you have already made up your mind ?

I am not really sure what is going to happen in 4-5 years time but good luck.

Indeed, the problem is no one knows what's going to happen in 4-5 years time!

Acc72

Chimpofdoom wrote: »

Indeed, the problem is no one knows what's going to happen in 4-5 years time!

Surely he will "start to see a return for his money" ..... won't he ? ...

GlynD

OP seems confident in his own thinking and rationalisation. I wish I'd been able to take this step when I was his age so more power to his elbow. By the time he's 40 he'll be so much better off because he is well up the housing ladder.

GlynD

Acc72 wrote: »

Surely he will "start to see a return for his money" ..... won't he ? ...

Of course he will (in my opinion). He's buying at a time when the housing market is severely depressed. I've certainly seen this happen before and was lucky enough to get a cash injection by buying at the right time myself and then selling a year later. The fact that I own my own home outright now is largely down to sensible buying and selling practices.