Looking to get on the property ladder in the near future

krish123

Hi all,






as the thread title suggests im looking to get onto the property ladder in the near future say 1 or 2 yrs. I want to start my research now so I can plan ahead as a house of course is a big purchase.




I also want to buy in the way that will suit me most I know the government help to buy scheme is still going and maybe this is something I could take advantage of?


I have limited knowledge of buying property so any advise will be welcome.


Now in terms of my financial state i currently live at home and am 23 years old. I earn £1530 per month and save at least £500 of that a month. I am currently single so i don't know how much this will affect me and whether i could actually purchase a house on my own ?


Also i don't necessarily have to live in the house i purchase its mainly to get on the ladder and make decent money from the house and buy a bigger on ein the future for which this one i could live in myself.

Loopy28

If possible try and save at least 10% as it is easier to get a mortgage and you will get a much better rate than 5% deposit on the government help to buy scheme.

Also save up for the fees-this will be solicitors and budget about 1k and also stamp duty, which is 2% of the property value over 125k. S a house of 130k would be £100.

Use some online mortgage lenders calculators to get an idea of what you can borrow and what the repayments would be, then you can aim for what deposit you will need to save.

krish123

Loopy28 wrote: »

If possible try and save at least 10% as it is easier to get a mortgage and you will get a much better rate than 5% deposit on the government help to buy scheme.

Also save up for the fees-this will be solicitors and budget about 1k and also stamp duty, which is 2% of the property value over 125k. S a house of 130k would be £100.

Use some online mortgage lenders calculators to get an idea of what you can borrow and what the repayments would be, then you can aim for what deposit you will need to save.

thanks for the reply.
i think i could stretch to saving up a 10% deposit. i currently have £5500 in my account and a £1000 in funds however i would prefer not to touch this money.
in terms of the house price i think realistically i would be looking for something in the region of £150,000-180,000, but im unsure whether i would be given a mortgage even if i have the 10% deposit?


Also what does everybody think in regards to the help to buy scheme? is this something i should be interested in or is there more benefit for the government etc.

jc808

where do you live/ where are you looking?

krish123

jc808 wrote: »

where do you live/ where are you looking?

I live in Warwickshire and would be looking anywhere in the midlands for a property.

krish123

anyone else got any input on this?


realistically or someone in my position how much deposit % would I need to put down? is 10% unrealistic?


also if I could not afford a house are flats worth looking at as an initial investment to rent out? how do capital gains fair with flats against houses?


Atm I just need general advice as iv only just started out researching on properties.

laurathree

I would say save save save for your deposit. That will make a huge difference to what you can afford - it is the biggest hurdle. I would recommend looking at your monthly outgoings - if you are on £1500 and living at home (assuming a low or no rent situation) you might be able to save more than £500 a month. And the difference is big over the time you're planning to save.

If you save £500/month for 2 years, you will save £12,000.
If you push that up to £750/ month, you will save £18,000.

That's 10% of a much bigger house, even before you factor in interest, and worth the belt-squeezing for the short term.

Good luck with it!

Annisele

krish123 wrote: »

i think i could stretch to saving up a 10% deposit. i currently have £5500 in my account and a £1000 in funds however i would prefer not to touch this money.
in terms of the house price i think realistically i would be looking for something in the region of £150,000-180,000, but im unsure whether i would be given a mortgage even if i have the 10% deposit?

I think you're going to struggle. If your take home pay is £1530 per month, then I'm assuming your salary is around the £22,600 mark? If that's the case, then a 90% mortgage on £150k to £180k house would be six to seven times your salary - and you won't get a loan that big. So, for a house that expensive, you'll need to save quite a lot more.

Pixie5740

If you're living at home just now, what bills do you have to pay that only leaves you with £500 a month to save? These bills will be taken into account when calculating your affordability but as Annisle says, on your salary with a 10% deposit you ain't going to be buying a £150k property.

If you're thinking of buying a flat why let it out? Why not just live in it? You won't get a BTL mortgage with a 10% deposit on your income with no residential property owned.

krish123

laurathree wrote: »

I would say save save save for your deposit. That will make a huge difference to what you can afford - it is the biggest hurdle. I would recommend looking at your monthly outgoings - if you are on £1500 and living at home (assuming a low or no rent situation) you might be able to save more than £500 a month. And the difference is big over the time you're planning to save.

If you save £500/month for 2 years, you will save £12,000.
If you push that up to £750/ month, you will save £18,000.

That's 10% of a much bigger house, even before you factor in interest, and worth the belt-squeezing for the short term.

Good luck with it!

good point,


to be honest with you I think I save more toward £600 or 700 pound. I used £500 as a cautious figure.

krish123

Annisele wrote: »

I think you're going to struggle. If your take home pay is £1530 per month, then I'm assuming your salary is around the £22,600 mark? If that's the case, then a 90% mortgage on £150k to £180k house would be six to seven times your salary - and you won't get a loan that big. So, for a house that expensive, you'll need to save quite a lot more.

Hi,
my salary is £23,500 but I am also paying my student loan back to.


right ok so realistically its either look for a less value property i.e £100k - £130K or build up a larger deposit say 15 to 20%.