House prices going up quicker than I can save a deposit :-(

princeofpounds

If your partner is at university then you are probably fairly young. The average age for a first time buyer is now around 35 (and older in London, though that is probably skewed), so don't think you are falling behind everyone else.

When houses start to accelerate in this way, it's rarely sustainable precisely because the support at the base of the ladder is kicked away. But it doesn't slow or correct immediately, particularly if interest rates remain low and mortgage financing is becoming more available. The boom being engineered at the moment (and it really is being engineered by Osbourne's help-to-buy and an exceptionally dovish bank of england head) is probably due to be sustained until the election, but after that we might see them make different choices.

ReadingTim

jonewer wrote: »

Owning a house is not the be all and end all of living a happy and fulfilling life. Relax.

That statement is considerably easier to make when you own your own property and have paid off the mortgage (as I notice you have from your signature) - being at the mercy of amateur landlords, parasitic letting agents, 6 month ASTs, s.21 notices, unprotected deposits, and beige walls can rather impinge on one's ability to relax, achieve happiness and fulfillment in life.

princeofpounds

It's true. Life is massively different without security of tenure.

6 months is pretty much all you get, at least initially. Think about what that means - you only get to live somewhere for 12 weeks before you start to wonder whether a Section 21 is going to drop through the letterbox.

It makes life difficult in many different ways, but it means having children is exceptionally hard. If you can't guarantee a year of consistent accommodation, it's not easy to guarantee a year of consistent schooling.

leccyblue

meady100 wrote: »

I'm getting a bit fed up. Am I missing something financially, could someone reassure me?! I'm living at home and saving £1200 a month towards a house deposit which I think is pretty good going - I've managed £20,000 so far and want to reach £40,000, but the prices of even small houses (about £170,000 round here) are increasing at more than this per month. How will I ever get on the housing ladder? In a years time that house will be £17,000 more and I will only have saved £14,400! Even my best efforts mean I'm getting further and further away from getting on the property ladder instead of closer. I think saving £1200 is doing quite well, so what is everybody else doing who can't even who manage this much? Will these house price increases begin to slow? I just can't see what my options are...

The way I would be looking at this if I were you, is that currently the limiting factor is your partner being at university. That isn't going to change whether you win £10k on a scratchcard, the housing market falls through the floor, or the housing market booms and prices go through the roof. It doesn't matter what state the housing market is in, because you aren't in a position to buy.

The best thing you can do is save as much as you can (which you are already doing well with) and then look at the market when you are in a position to buy. Why get anxious about a situation that, until your partner finishes uni, is impossible?

princeofpounds

I'd also add that having 20k savings at that age is well well ahead. most people come out of university with -20k these days.

AndyGuil

The deposit is leveraged so even if house prices increase more than you save per month you will be fine. It depends on what you earn but with 40k you will be in a good position to buy.

AndyGuil

princeofpounds wrote: »

I'd also add that having 20k savings at that age is well well ahead. most people come out of university with -20k these days.

The student loan isn't taken from any deposit saved. The loan repayments are taken into account for the amount they will loan you. However this has a tiny effect.

allthingsmustpass

This is why the rises aren't sustainable. If no-one can buy, no-one can sell. So prices come down again. Its been up and down like that for a long time. This time the drivers are temporary and in place to create a feel good factor in time for the election.

After the election things will look better for you.

Keep saving and buy out of desire (not fear) when value returns to the market. Buying out of fear is not a good idea.

princeofpounds

The student loan isn't taken from any deposit saved. The loan repayments are taken into account for the amount they will loan you. However this has a tiny effect.

It wasn't a literal statement, I was just making a general point about net worth for people of that age.

SuzieSue

meady100 wrote: »

but the prices of even small houses (about £170,000 round here) are increasing at more than this per month. How will I ever get on the housing ladder? .

That's exactly what my ex said in 1988 just before the recession when he was panicked into buying his first flat. He sold it in 1997 for the same price that he had paid for it.

You just need to save up as much as you can and buy when the time is right for you. You might not be able to live exactly where you would like to (I would like to live in Chelsea but can't), but you will find something to buy.