Embarrassed FTB seeks advice

DoubleOhScrimp

princeofpounds wrote: »

Make use of stamp duty boundaries - you can typically do quite a bit better buying something for 250k than 230k for example, as more properties that would be priced at 260-270 might be prepared to take a 250k bid.

Having thought about this some more. Being able to buy a 270k place for 250k would be great ... until its my turn to sell. I'd have to hold the property for a long time and be sure it was worth well in excess of 250k before being able to sell. Effectively the property would not appreciate at all for many years and then suddenly undergo a step change in value once it was clear of the cliff edge. Thinking about all these scenarios makes ones head hurt :eek:

ognum wrote: »

I haven't yet been to see the new houses in Trumpington, is it really the Cambridge hotspot?

That was intended to be somewhat tongue in cheek. There's nothing special about Trumpington except in the eyes of the developers who seem to think its the new Mayfair and price accordingly.

ognum wrote: »

As for BTL are you going to do this in Cambridge, house prices are high and it's hard to get a good return, of course village properties are cheaper but the demand is less and so is the rent.

I get the impression that BTL yields in Cambridge are not lower than other areas e.g. Newmarket based on actual BTL figures given to me by an IFA who owns BTLs in and out of Cambridge. Figures I was given were: Cambridge: £200k = 900pm rent, Newmarket: £150k = 550pm rent. But as I dont actually have any BTLs take anything I say with a wheelbarrow of salt. There are probably actual Cambridge LLs on these forums who could provide more accurate figures.

Another thing I have to think about: I dont particularly want to live in Cambridge (Prefer living in a village with a proper garden and I really want a garage for my workshop) but (presumably) property within Cambridge would be more stable and appreciate more. Decisions, decisions, ...

Fire_Fox

DoubleOhScrimp wrote: »

Having thought about this some more. Being able to buy a 270k place for 250k would be great ... until its my turn to sell. I'd have to hold the property for a long time and be sure it was worth well in excess of 250k before being able to sell. Effectively the property would not appreciate at all for many years and then suddenly undergo a step change in value once it was clear of the cliff edge. Thinking about all these scenarios makes ones head hurt :eek:

You should be looking to do that anyway, property is a sound investment longer term - ten years plus - but a gamble shorter term, look at the last five years. Thinking longer term is particularly important when we are in a recession, prices are static or rising slowly in most areas. Some areas increase faster than others, for example family homes in villages with excellent schools or great transport links.

You need to be prepared for different scenarios: what if you end up with a pregnant partner sooner than planned, you are offered a dream job outside the area, you are ill or injured and cannot work, property prices start falling again. Will you want or need to sell early, do you have options like taking in lodgers, is there is enough equity for consent to lease, can you add an extension or loft conversion and so on.

Learn from other's mistakes: too many buy houses or apartments that they will grow out of within five years, borrow too high a percentage, don't factor in all the costs of buying and selling. Then the market falls and they are tens of thousands in negative equity, in some cases can neither get consent to lease nor permission to sell. People are still coming on MSE wanting to get on the property 'ladder', imagining they have been missing out these last few years!! Too many are being repossessed IMO because they massively overstretched themselves and completely failed to plan for changes in circumstances.

You seem a whole lot more switched on than that tho. :T

DoubleOhScrimp

Thanks for all the advice Fire Fox ... I'm mulling over all you have said. And will post a response when I have my thoughts in order.

In the meantime I found something I didnt think existed ... a not horrible detached house in Cambridge WITH garage for 270k (my max offer 250):
http://www.rightmove.co.uk/property-for-sale/property-34467862.html
I might have to go for living in Cambridge after all ...

Fire_Fox

And the prize for the laziest estate agent goes to ..... no room sizes, barely any photos?? I wonder if you could build over the garage eventually?

DoubleOhScrimp

Fire_Fox wrote: »

And the prize for the laziest estate agent goes to ..... no room sizes, barely any photos?? I wonder if you could build over the garage eventually?

Its not big. I find it mind blowing that 70 square meters of living space costs £270k. Isnt that London pricing?

Aside from the price it kind of looks reasonable as an eventual BTL to my naive eye. Transport, schools, proximity to CBD, ...

Fire_Fox

DoubleOhScrimp wrote: »

Its not big. I find it mind blowing that 70 square meters of living space costs £270k. Isnt that London pricing?

Aside from the price it kind of looks reasonable as an eventual BTL to my naive eye. Transport, schools, proximity to CBD, ...

A good part of Cambridgeshire is London prices: plenty of commuters, plenty of students with two universities in the city, plenty of work for those with post grad qualifications. The house looks well worth viewing IMO.

DoubleOhScrimp

I could go for it at £250k but it would require 1950s style super scrimpage for 2 years to get the LTV down to 75%. And then more years of scrimpage to get a BTL deposit ready.

Sounds like a worthy challenge for doubleOhScrimp :doh:

Edit: Looking at zoopla almost makes me think its overpriced:
http://www.zoopla.co.uk/house-prices/cherry-hinton/lucerne-close/?price_frequency=per_month&q=LUCERNE%20CLOSE%2C%20CHERRY%20HINTON.%20CAMBRIDGE&results_sort=newest_listings&search_source=home

The closest I can find is:
22 Lucerne Close, Cherry Hinton, Cambridge CB1 9YR
Detached, Freehold, 3 Beds, 1 Baths, 2 Receps - Edit
220k

Fire_Fox

You've found MSE, all the answers and challenges are here! Once you have your own place you can do loads of 'in house' socialising - you can get hammered and serve up a great meal for next to nothing. Not running a car is the way forward if it is at all practical, obviously depends on work. You could easily have a lodger if you wished.

ognum

DoubleOhScrimp wrote: »

Thanks for all the advice Fire Fox ... I'm mulling over all you have said. And will post a response when I have my thoughts in order.

In the meantime I found something I didnt think existed ... a not horrible detached house in Cambridge WITH garage for 270k (my max offer 250):
http://www.rightmove.co.uk/property-for-sale/property-34467862.html
I might have to go for living in Cambridge after all ...

Hmm, that is not Cambridge its in Cherry Hinton, a very large housing estate outside Cambridge! Well it does have a Tescos I suppose.

DoubleOhScrimp

ognum wrote: »

Hmm, that is not Cambridge its in Cherry Hinton, a very large housing estate outside Cambridge! Well it does have a Tescos I suppose.

Anything on that side of the M11 & A14 is Cambridge to me

Although I was initially very averse to the idea I'm now thinking a lodger wouldnt be a bad idea at all. The +£400 pm (presumably) would make it easy to get to 75% LTV in 2 years. I wouldnt have to scrimp much if any :beer:
In a 3 bed 2 bath place it wouldnt be that much of an inconvenience either ...