Save until October or buy now

KnightSmile

Hi all,

I have saved a deposit for a few years and would like to save a few thousand more before buying.

So at the moment I have enough of a deposit (plus a mortgage) to get a half decent 1/2 bed flat. If I saved that little bit more (which will take 5 months longer) I can afford a 2 bed house which is my preference for several reasons.

I'd prefer to continue saving, however, I'm worried that in 5 months nobody will want to sell as it will be October/November time and there wont be much on offer. This wouldn't usually be an issue as I could wait until early next year (2014). What worries me about waiting is the new funding scheme (funding for lending?) is introduced from Jan 2014 and everything I am reading suggests it will push prices up higher (putting the affordable 2 bed house out of my reach possibly).

My question is - Do I put use my 25% deposit I currently have on a flat now or do I save a bit more and wait until I have 25% for a house?

Grateful for views.

KS

caeler

Wait. You will out grow the 1 bed flat before you can blink and for the sake of a few months (which can almost be as long as the buying process) you will get more spare which will be a bit more future proof. People sell houses at all times of the year, my last two purchases have been around October time.

ValHaller

KnightSmile wrote: »

I'm worried that in 5 months nobody will want to sell as it will be October/November time and there wont be much on offer.

Often it is the other way about - no one wants to buy and the people who are selling are keen to do a deal.

Ciderarmy1987

Roughly how much extra are you hoping to save in the next 5 months. If I was you I would look at buying a 2 bed house now but with a lower percentage deposit.
Also even if you start looking at houses now you are unlikely to complete until August/September time so will only lose 1 or 2 months or saving.

Remember you can also over-pay on the mortgage to bring the amount of interest you are paying.

retepetsir

Certainly go for the 2-bedroom house option over the flat, particularly if it's freehold vs. leasehold. Just think of the money saved in monthly maintenance charges. We're just about to move from a 2-bedroom flat to a house and will be glad when we do!

mummyroysof3

I would defiantly wait in order to get something bigger. Seems daft to buy something too small to move again for the sake of a few more months saving. Depends on your area but here there isn't much selling ATM so don't worry to much about the time of year.

AndyPK

It's worth starting looking now to see what is about and what your money gets you.

If you find somewhere u love maybe a deal can be done.

KnightSmile

Thanks for the advice. It seems most people are saying to wait in order to buy a house. I'm in the South east.