Getting onto the Property Ladder

lucy_w86

My partner and I both live at home and need to move out soon. We can not spend the next 5 years living at home and saving for a sizeable deposit to buy a place.

At the moment, we earn £43,000 between us and therefore will only be lent around £115,000 max. I have used online calculators to work this out; Halifax, Nationwide etc...

We cant buy anything for that value around here and would also need a 100% mortgage.

Can anyone advise what to do now? What about part buy part rent?

Thanks

nobblyned

You will be able to borrow more than that (if you want to!).

See an independent broker for a chat.

Phirefly

Depending on whereabouts in the country you are, I think if you really want to move out, rent somewhere reasonable and try and save as much toward a deposit as you can. Theres really no such thing as a property ladder, while its hard not to feel like you're desparately trying to catch the bottom rung on a ship that set sail, it really isn't like that. Outside London, property prices are not rising any more in the same way they have been in recent years.

Interest rates ARE rising though and with a 100% mortgage you will really suffer as these increase. In a few years you will be earning more, have a deposit and property prices will not have risen that quickly. Things will look more rosy then

On the other hand, if you're talking about London, I've no idea what to suggest - god help you!

lynzpower

where abouts in the UK are you?

Given the fact that you are living at home, how come you havent saved any deposit? To be honest you'll get access to a much better range of products if you put a few K aside for the deposit at least.

F_T_Buyer

Why don't you rent together, it would only cost on average about 15% of your gross income. Less than a 100% IO mortgage, and you ain't tied down!

King_Of_Fools

I would suggest that you rent a place and save the difference between the rent and the interest on a mortgage towards a deposit on a house once the prices have fallen back to more sensible levels in a year or so.

olive84

My bf and I have a 100% mortgage and earn roughly what you do. We're borrowing £177,500. Having said that neither of us have any debt, so no other monthly payments. I know there are some people on this forum who are going to say that we're mad, but believe it or not we can afford it. We took a long long time going over the costs of owning a house though, because obviously its not just the mortgage, but c tax, bills and all the rest of it.

So, I just wanted to add something positive here, because it can be done. Talk to a broker because they will let you know what you can really borrow!

pamaris

Hmmmm I don't understand why if you are both currently living at home you can't save some money for a deposit. If you just want to live together NOW then just rent; I do not feel it is wise to take out a 100% mortgage at this point in the game (possible/ probable house price correction/ deflation/ crash).

CB1979_2

ah not the dreaded "I want it now" scenario.

unfortunately it's tough, live at home enjoy the fact you must be paying nominal rent, and save save save!

in 3 months I don't see why you couldn't have at least saved £5k.

an example of my circumstances, I own a place and rent it out at the moment (due to g/f not working through surgery) my mortgage I/O payments are £650pcm on £165k mortgage (granted fixed at 4.49%), yet i pay my parents £150 a month "rent" which includes all bills except for my food/cleaning products.

so straight away that's me £500 a month better off, and that's not including the council tax, gas, elec, water, phone, tv licence, insurance, etc etc that i'd need to pay if i were renting/on a mortgage.

so you're probably nearer to £800pcm better off than living on your own, so why are you not saving this extra money each month + add on your partners £800 as well and your quids in.

lucy_w86

I need to move out as our house is small and they could do with the space.

So, in the next few months, I have no choice but to rent. But my partner and I would like to buy our own place rather than rent as its dead money. Getting onto the property ladder is just so difficult.

King_Of_Fools

lucy_w86 wrote: »

So, in the next few months, I have no choice but to rent. But my partner and I would like to buy our own place rather than rent as its dead money. Getting onto the property ladder is just so difficult.

If rent is dead money then so is interest payments on a mortgage.

If the rent on a property is less than the interest payments for a 100% mortgage on a similar property then you are better off renting. This is the case in the majority of places in the UK now. Until house prices correct for this, renting is not dead money!