Preparedness for when

GreyQueen

:eek: Uggh, greenbee, my calves and feet are now itching sympathetically.

Know what you mean about neglected homes. Although I rent my flat, several of my friends have bought fixer-uppers as it was all they could afford, and the neglect was appalling. Several places need gutting and I have seen bathrooms in hues fit to give me nightmares.

Although there are grants available to private owners in financial straits, there are a lot fewer of them than there once were, as I know through approaches from the public via my work. I come across home-owners who have been able to fund nothing by way of home improvements themselves for 30+ years; what has been done has been done on the public's shilling.

If you keep your eyes peeled, you can see plenty of neglected properties, where maintenance hasn't been done on any decent schedule. I know people who have knowingly left their gutters completely blocked for 20 odd years, with water running down their wall and then are all surprised that they have a penetrating damp problem.........!

Keeping the place decluttered and cleaning regularly, taking note of things which need repainting/ repairing/ cleaning out/ replacing is all part and parcel of home ownership. You need to be on top of your game or your investment is depreciating around your ears.

nuatha

mardatha wrote: »

The other thing that's just as important as having money is having your health.

I consider health to be a far higher priority; speaking as another ME sufferer, I have less of either than I'd wish.

GreyQueen wrote: »

I think the issue about mortgages is to consider what you want to achieve by home ownership. Owning one's own home is such a central part of British life that we often don't consider that it's an option to do otherwise. It's positively heretical to question the home-ownership meme, it just isn't done.

...
I know people who have been put in terrible positions because they needed to move and couldn't sell, or couldn't sell at what they believed was the right price for their home, and all their 'wealth' was tied up in bricks and mortar. Your work could move to the other side of the country, your present location could go down the tubes and become a dangerous slum or an economic desert, you could need to relocate to provide support for family members, or to recieve such support, and not be able to do so.

There are plenty of negatives to home-ownership and, because it's such a sacred cow in our culture, I think it's important to think those through, rather than just blindly reaching towards it.

The sacred home ownership meme only became particularly widespread after Thatcher decided to sell the country's housing stock. Prior to that the growth in home ownership was rising but so was renting of social housing (which peaked in 1981)
Figures from the 1971 census show something very close to parity between ownership and renting, ownership peaks in 2001 at 69% and then falls over the next decade to 64%. Incidentally London returns to parity between ownership and renting by the 2011 census.
We chose to buy because it was substantially cheaper per month than renting would be, and that was without estate agents charging major fees every 6 months for credit cheques and signing a new rental contract (effectively another moths rent). We chose a house with the same maximum commute time for Herself (though twice the distance as the crow flies) that met the criteria we drew up. The mortgage repayments for a three bed house were £150 per month cheaper than the two bed room flat without any garden, yard or garage (or for that matter nearby on street parking). The landlord planned on renovating that flat and putting it back on the market at double the rental. (We'd ended up renting it because my previous landlord had decided to withdraw from renting properties in the area I lived in and was selling his stock off.) There wasn't a lot of choice that would allow me to pay the full contract rental up front as I wouldn't pass a credit check.

The outstanding mortgage is well below market value, which gives us the option of handing it back to the bank, knowing it will cover the outstanding debt. In that scenario we'd still be substantially better off from the monthly savings from not renting.
I appreciate that logic may not work for everyone, and frankly, I'd rather things didn't get to that state, it would be nice to enjoy a few years with only maintenance to fund. If our benefactor enjoys a couple of holidays or a new car after we're gone, then good on him.

As I said our logic may not work for anyone else and our original plans have had to be severely amended due to health problems making a substantial difference to incomes, but thinking through options and playing with what if scenarios hopefully makes making your own choice easier.

TiredTrophy

Here the tax system discourages having less than 60% mortgage -you inherit the debt-and doing work on the house improves your tax situation . You are taxed on your assets every year! We rent a small flat.

Planning for SHTF is different for us....but we hope one day to move back to the UK so we are trying to save within the pension provision....we can take some of this with us when we leave and this is not taxed every year saving us 20%

When we lived in the uk we only bought as we could not get a rented house for our many children when the home we had was knocked down. The landlords wanted 6 months rent as deposit .We would not have been able to afford to buy according to new rules so I do not know what folks do now.
Not being able to get a home at all is a real SHTF...we had been on the housing list for 12 years and were told there was nothing suitable and the family would be divided into two BandB 20miles from the childrens schools and 33 miles from work!....it was going to cost more than the mortgage ended up as.
I hope this is not too rambling....

GreyQueen

The trouble with health and wealth is that they are very closley intertwined. Because I am ill, I work part-time, because I have a part-time wage, I am poorer than a full-time worker. Having had ME since I was 20 years old (it struck after a go-round with glandular fever) plus another chronic illness, I will have racked up a significant wealth-reduction by the end of my working life.

Hey-ho, worse things happen at sea, one just has to get on with it.

I can quite see why people facing private rents in excess of mortgage repayments would want to buy rather than rent. Even at southern-England prices, it sometimes happens here. What we also have is a situation where there is a whole rentier class funded by the buy-to-let mortgage sector who are pouncing on the smaller, affordable homes and adding them to their rental portfolios.

I'm not having a dig at individuals who post on these boards, as some of our regulars are landlords, but landlordism does have powerful social and economic consequences which are negative for many people. We have a small handful of landlords in my city, each with several hundred properities, often ex-council stock. Their doings (and some of them get prosecuted by the council from time to time) dramatically shape the lives of thousands of city residents for the worse.

I talk to people about RTB during the course of my work. Some of them are so unworldly that they haven't grasped that trying to buy even a heavily-discounted house with benefit-only income is unwise, to put it mildly. Or haven't understood that once that house is signed for, they are responsible for the repairs, the annual boiler service etc etc. I know it sounds hard to believe, but it's happening IRL. We also see people who lose their RTB property into bank repossession in less than a year.

It's hard not to see a conspiracy of the central government and the mortgage sector to remove as many of the publicly-owned assets into private hands as possible. Central government also decides to do extra mailouts to council tenants about RTB, there are posters up in bank and building society windows. The latter amuse me, in a grim way, as the small print at the bottom of the poster invariably says;

Your home may be at risk if you do not keep up repayments.

I love the 'may', it's so much more comforting than pay your mortgage or we'll take you to court and repo that house so fast you'll have friction burns as we evict you.

[Deleted User]

It's a nice feeling to actually own the house, we made some hard but sensible decisions when we had redundancies or cash enough to continue paying the mortgage at the highest rate of interest level because we could, just! We own the house because of making those decisions over having extras, holidays, posh clothes, jewellery, new furniture, new cars, in a word 'STATUS'. We prioritised home over fripperies and it was the right decision for us as a family. Now I know we are lucky to both see the world from more or less the same platform so making the decision to actually have and do less wasn't a problem for either of us so we're not LUCKY to have the house, we are feet on the floor sensible and probably a bit dull. These days many folks seem to expect to have all and everything they think they 'should' have and to feel pretty hard done by if they don't get these things instantly. We still have very little that is bought 'new' we have a home full of carefully refurbished and cared for second or sometimes third hand things that we value. I don't see the point in jewellery, designer names, big hotel holidays, posh frocks, shoes, handbags or perfume or changing the decor and contents of the house every time a new fashion or colour scheme appears in the media. It's not now and never has been a world in which ordinary folks in the street just like us can have all we think we should, it's just the impression in the media and constant reinforcement of that impression that has made most people think they can and are entitled to and that is why there is this huge feeling of discontent throughout the population. I can understand fully though the 'need' to own your own home, it's a security thing and I think if you can achieve it it will make you less anxious but there is nothing detrimental either about renting, the biggest problem with renting, looking in from the outside is landlords who aren't prepared to do the upkeep or repairs on their let properties. Time after time we read posts of things going wrong or breaking or wearing out and time after time there is a real fight by the tenant to get any action at any level, that's such a wrongness and must be grindingly wearisome and that was partly why we made the dicision to bite the bullet and actually buy a home.

DawnW

GreyQueen wrote: »

I think the issue about mortgages is to consider what you want to achieve by home ownership. Owning one's own home is such a central part of British life that we often don't consider that it's an option to do otherwise. It's positively heretical to question the home-ownership meme, it just isn't done.

Also, regardless of the age at which a lender is prepared to extend a mortgage offer to you, what is your aim in having one? If you start out young enough, you could perhaps aim to be mortgage-free in your forties and look forward to several years before you die with no direct housing costs beyond maintenance and improvements.

But you will always have maintenance costs, a house or other form of home doesn't just sit there inertly, things are wearing out. You could be in the position at the latter part of your life where you are a property-owner but cash-poor and are unable to afford to maintain your home. And, if you will be paying a mortgage into your sixties and dying (probably) in your eighties, how much benefit will you accrue from those mortgage-free years?

Of course, some people have their eye on posterity in that they'd like to leave their property to their children, but if you have more than one heir, what you leave is liable to be so carved-up that it won't be a life-changing amount of money to your offspring. Your careful husbandry of your resources might equal a couple of nice holibobs and a new car for your heirs.

TPTB love home ownership because they take a piece of the action when property is bought and sold. It also ties you down and controls your behaviour. I could get out of my tenancy in 4 weeks and I don't know anyone IRL who has managed to complete the sale of their home that fast.

I know people who have been put in terrible positions because they needed to move and couldn't sell, or couldn't sell at what they believed was the right price for their home, and all their 'wealth' was tied up in bricks and mortar. Your work could move to the other side of the country, your present location could go down the tubes and become a dangerous slum or an economic desert, you could need to relocate to provide support for family members, or to recieve such support, and not be able to do so.

There are plenty of negatives to home-ownership and, because it's such a sacred cow in our culture, I think it's important to think those through, rather than just blindly reaching towards it.

Yes, there are negatives, but when the option is the private rented sector, where you might face having to move every six months, and the sheer cost of the rent and all the fees etc each time you have to renew the tenancy.... If there were more council /housing association tenancies, or the rules were more like those in say, Germany, fewer people would think it so important to buy. I don't think it is purely a cultural thing. Right to buy, which has led to a shortage of social housing for those that need it, some people losing their previously secure homes because they fell on hard times and couldn't pay the mortgage, and others cashing on on what had been a publicly owned asset, has had a big impact

GreyQueen

The trouble with the private rented sector is that successive changes to the law have placed all the power into the hands of the landlord, with very little redress open to the private tenant. And with the Section 21, all they have to do is serve 2 months' notice and you're outta there. No wonder that many private tenants are afraid of rocking the boat. When the housing market was hot, I've known parents who have had a private rented home sold out from under them thrice in 18 months. Try navigating that with a school aged child.

Private tenants regularly contact the council seeking our assistance against their private landlords in the matter of redress over disrepair. Oftentimes the landlord lives overseas, either ex-pat Brit or a foriegn investor, the property is with a letting agent and all they care about is getting the money in.

If any political party was serious about increasing the well-being of the private tenant, there would be swinging reforms of private tenancy law, and rules about charges for renewing contracts etc. Renewing a rental contact as a cost-of-doing-business to the letting agent, it shouldn't be a fee levied annually or bi-annually on the tenant. There are letting agents here who are nothing but shysters and are widely despised, but they control access to so much city property (about 25%) that there are few choices about doing business with them; it's a case of choosing the least-dirty shirt.

moneyistooshorttomention

The house I recently bought had been substantially neglected since the 1970s - a bit of cheapie work that will "do" done and some cheapie work that was so "cowboy" it had to be ripped out and replaced instantly. I wouldn't count it as having been safe and it definitely wasn't even functional.

Loads of money spent later:( and its now safe/functional/reasonably modern/etc. A lot more money needed yet before its finished...but at least I've got it to "Will Do" standard currently.

Tell me about it re missing out on luxuries. On one single persons salary, I can count on one hand the number of holidays I've had in my lifetime (now in my 60s)/fashionable clothing = very rarely/even had to think about whether to pay a bus fare to get somewhere (which resulted in more often than not foregoing whatever bus trip I had just decided to make:().

So, it took effort...a LOT of effort...to deal with what I saw/see as No. 1 priority...and a good dose of luck at one point:T. I saw it as the Triple Whammy of poor pay/expensive city/single. I could have coped with one of those things, maybe two of them at a push. But having all 3 and that Triple Whammy made it very hard and I had to be very determined indeed.

I'm hazarding a very very rough guesstimate that, once the house is finished (and lets hope to goodness it doesn't need any "maintenance" whilst I'm getting the money together to do that.....) that it will take somewhere around £500-£1,000 pa to maintain it (including the yearly gas service). So, I will be quids in on renting - eventually...sigh....

EDIT; One point that wouldn't affect a lot of people on the renting front, is I was very conscious that "political animals" (as I used to be for some time) could - and did - lose jobs because of that. One way or another - directly or indirectly - I needed to own my own place much more than I would have if I hadn't been a "political animal". People like that are penalised financially sometimes for being that way and I, quite definitely, lost one job and didn't get given another to my certain knowledge because of that fact and so I knew I had less financial security than many because of that. In rented accommodation - even if I had always been able to find the money to pay the rent ok - I would always have wondered if someone elsewhere on the "political spectrum" might be a friend of the landlord and I would find my notice in the post because of that.

There's always the option of going for "put up and shut up" and toe the line and not consider myself entitled to having been that way....but I wasn't going to do that...hence the mega-drive for security I personally have. I could see that people from wealthy backgrounds "said their piece" regardless, but people from ordinary backgrounds such as my own often regard that as being an unattainable luxury for us..but there ya' go. Some of us do decide to "say our piece" regardless, but still want a normal standard of living.

[Deleted User]

I was a stay at home mum as I couldn't get a job that would pay enough for both girls childminders fees and also give me any return for my services. We managed on a single salary and made what we felt were the right decisions and managed our finances accordingly. We've never bought a property either that was in tip top condition, in fact we've been in this house for 21 years now and have only within the last month found ourselves in a position to have the original avocado 1970s bathroom suite replaced. There are still things to do here but we will budget for them and go without other things in order to achieve the necessary cash to do them. When we moved here to Hampshire it wasn't from choice but via a job change and we came from a deprived area in mid Kent to a very affluent area of Hampshire where properties were at least twice as expensive as at home. That's life, we managed, again JUST!, don't feel hard done by in the least and have a good life, not the same style as neighbours who still fly off to overseas destinations 3 or 4 times a year and don't have to watch the pennies but, we enjoy our life, we lack nothing and we're content with out lot!!!

moneyistooshorttomention

This is the thing...we all go for what is most important to us personally. To me personally, I was determined to own a house regardless of there only being one income coming in because of being single. Other people are equally determined to have children. I guess I had the option of getting married to have two incomes coming in ..but turned down my chances at that...because I knew myself well enough to know it had to be The One or No-One, as I knew myself well enough to know that if I'd married Mr Wrong For Me, then I would certainly have been unfaithful to him and eventually divorced.

You pays your money and takes your choice and we all we make our own personal decisions of "What We Darn Well WILL have" regardless.