How do people afford expensive houses

agrinnall

ognum wrote: »

1. Saving
2. Moving area
3 Marrying or living with another person
4 Inheritence
5 Luck
6 Doing up a low value property and selling on
7 Gradually moving up the ladder
8 Inflation

It's late can't think of any more at the moment but it's not rocket science to work this out

You forgot

8 Armed robbery
9 Importation of illicit substances
10 People trafficking
etc.

Although any of them may earn you a stay in a big house on Dartmoor or the Isle of Wight with lots of other people.

dc197

a) I worked hard to save for my first house
b) I put down a large-ish (25%) deposit. Not bad for FTB.
c) I bought at a regional bottom of the market (2009 in my area)
d) I over-paid the mortgage
e) I got several pay rises and found a wife so my household incomings are far higher

Now less than 7 years after (a) I am buying a house costing 2.25 times what the house in (c) cost, but with a mortgage repayment only £200pcm more than I'm currently (over-) paying.
I'm pleased with that.

PasturesNew

Sleep with somebody rich. You do have to be attractive to get a house this way though, so that can be a problem for most.

gregsayer

my expereince. (aged 35 and 11 months)


1) since 2004, working !!!! off at job and saving a 5 figure sum to buy in 2008, and also getting 4 promotions in 11 years, and more then doubling wages upto 2015, whilst others were spending £100's a month partying etc
2) Parents working their !!!!!! off to help their VERY appricative spawn with a depost.
3) buying in a property price crash or drop (for me 2008) (2 bed 1980's end terrace)
4) remortaging (despite ERC) at the right time to bring down interest payments (£700pm to £450pm)
5) Still paying £700 pm and therefore overpaying and paying off 15% of the loan within 7 years
6) getting invovled with a small business (effectivly a 2nd job) for extra income.
7) selling house (2015) for £40k more then you paid for it in 2008 and having a massive deposit for the next house (£100k)


i now have a 4 bed new build with decent garden and garage, in one of the best areas of the city


downsides, only 3 holidays abroad since 2001.
only driving a focus (although new) whilst some colleagues are driving audis, BMW's etc,
but they also have massive debts and credit cards bills, where as i only owe £400 to DFS for a sofa! (4yrs 0%)

HappyMJ

My experience...I found moneysavingexpert and learned how to minimize my expenses so I did not need an earned income. I now no longer work full time working just one day per week and have enough money to pay the bills which have been significantly reduced without compromising on what I get. I still have the heating on at 20 degrees, I have 3 mobile phones, unlimited broadband, calls and TV including movies and sports etc but pay so little for it that many do not believe me.

I do not drive. I have owned a car before and a car is a big drain on your finances. I get all my shopping home delivered and town is within walking distance. If I wish to travel further there are buses and trains to take me elsewhere at the same or less cost of what I would have spent on parking and petrol and it usually is quicker and much less stressful.

I've never remortgaged having taken out a low variable rate for life offset mortgage to save on interest. I did not go out every Friday AND Saturday night for years only going out once every two weeks. I now go out twice a week.

saverbuyer

booksurr wrote: »

1. by having a career and progressing up its ladder

2. by taking advantage of relative inflation rates between areas when selling and buying

3. by cutting their cloth according to their means

4. By being born at the right time.

Rosemary7391

I think you have to pick the `right' (read: stable and well paid) career and/or buy with someone else. I'm unlikely to ever earn more than about £50-60k (and that not soon), nor have a partner, so I doubt I could ever afford a £400k house. I'd have to have something like £200k saved while I was still young enough to get a 25 year mortgage - can't see that happening no matter how good at saving I am! I'll be lucky to have a permanent job by the time I'm 35...

silvercar

1. being born in 60s
2. finding life partner at young age
3. buying young
4. minimising moves, to reduce £ loss on the cost of moves
5. buying most expensive can afford on each purchase to maximise gain from HPI.
6. Living in south east to gain relatively well long term from HPI

The first 2 were luck, the second 4 by deliberate choice.

ukcarper

Mrs_pbradley936 wrote: »

We started off in 1968 with a house that cost around £10k. In those days what a woman earned was not taken into account and we had something called MIRAS:
https://en.wikipedia.org/wiki/Mortgage_interest_relief_at_source

House price inflation really kicked off from about the late 70s to early 80s.
A house that we bought for £32K in 1976 we sold for £145K in 1981. I think the reason for that was being allowed to (by then) take what a woman earned into the mortgage calculation. Being able to borrow a lot more meant that houses cost a lot more!

If I still had that house I expect it would fetch over £2 million - alas I do not! However the house we have now would sell for about £750K.

We are comfortably off but back when we started out we were considered to be about average and certainly not well off. We have good pensions, and could easily downsize to release equity if we needed to.

So my answer to your question is house price inflation being on their side.

The average house price only doubled in that period so I would imagine the area your house was in improved or there was some other cause.

Also inflation was very high in that period and earnings followed. In fact the. House price to earnings ration was not much higher in 1981 than 1976 and nowhere near as high as 1973.

saverbuyer

ukcarper wrote: »

the average house price only doubled in that period so i would imagine the area your house was in improved or there was some other cause.

only doubled?