Real Potential of buying a house?

Foxy-Stoat_3

krish123 wrote: »

Really so you never can actually own the flat outright?

Most flats aree leasehold, so you own the lease which shortens every year.

Most BTL mortgages are interest only as well so the repayment vehicle is when you sell the property. You will have to factor in renewing the lease when you sell.

You have to do the sums so you see that investing in a flat to BTL may not be as profitable as you may think.

Hoploz

If you want to own in future, save like mad and get on the ladder as soon as you can. If you wait till you're with a partner prices could have rocketed by then.

In 10 years prices can change a lot. In 1999 I bought a flat for 85k. I sold in 2005 for 160k. It's now worth 225k. That's just one example totally random but makes my point. If I had not scrimped and saved every penny living at my parents and bought for 85k at age 25 and I'd left it 5 years till I was 30 the same flat would have cost me not far off double! Lewis's if I had bought 2 years earlier I could have bought the same flat for about 65k. (But I was at uni then!)

Nobody really knows what will happen to prices in the next 10 years, but the general trend is upwards so my advice is always buy ASAP, and buy something with two beds if possible as this gives you more options, eg. Rent a room/meet future wife and move her in/have a child or even two in bunk beds at a stretch and you still won't need to move.

What you don't want to do is start shelling out on rent, or have a child before you own a home big enough. these two things are the kiss of death for saving.

krish123

Hoploz wrote: »

If you want to own in future, save like mad and get on the ladder as soon as you can. If you wait till you're with a partner prices could have rocketed by then.

In 10 years prices can change a lot. In 1999 I bought a flat for 85k. I sold in 2005 for 160k. It's now worth 225k. That's just one example totally random but makes my point. If I had not scrimped and saved every penny living at my parents and bought for 85k at age 25 and I'd left it 5 years till I was 30 the same flat would have cost me not far off double! Lewis's if I had bought 2 years earlier I could have bought the same flat for about 65k. (But I was at uni then!)

Nobody really knows what will happen to prices in the next 10 years, but the general trend is upwards so my advice is always buy ASAP, and buy something with two beds if possible as this gives you more options, eg. Rent a room/meet future wife and move her in/have a child or even two in bunk beds at a stretch and you still won't need to move.

What you don't want to do is start shelling out on rent, or have a child before you own a home big enough. these two things are the kiss of death for saving.

yes i can appreciate that, and thats why i would like to start early if possible! What sort of loan did you get for the flat ? did you live in it or rent it out?

Hoploz

I lived in it for 3 years then rented it out when I bought a house with my now husband, then sold it to finance a big extension on our home without additional lending

In the beginning I took advantage of an early shared-ownership scheme for key-workers run by my local council. I could afford a 1 bedder without, but I needed more space - bed 2 was a home office. So I bought 70% of the 2 bedder and then a year or so later I refinanced (once I'd been paying a mortgage for a while and gained good payment history and my salary had gone up a little) and bought the other 30%.

Having said that, I would be very wary of going for a shared ownership scheme with a new specialised block of flats, which seems the trend these days. I bought an ordinary flat so it was in a good area not surrounded by 'social housing'. And I knew my starting salary was low but I would get guaranteed increases year on year, so it was always the intention to own the full 100% quickly. I would never advise going in for it if you're scraping to buy 25% with no prospect of ever gaining the rest.

That's my story, hope it helps.