What would you do in our position? In two minds...

GaggingOrder

Nobody knows what will happen to house prices, but assuming demand continues to outstrip supply they're likely to rise. That said, even in an open market it's not as simple as supply and demand. There will be a maximum price for everything. Given you're in Cornwall I expect the market there will be disproportionately affected by the changes to 2nd homes so that may indicate that prices would drop.

I'd say do your sums and keep a very close eye on the market comparing actual sold prices and looking for the number of homes on the market dropping their asking price. If good homes are dropping in droves it's usually a sign that it might be a good time to buy. The assumption being that in the longer term they will continue to rise. It's also worth looking at zoopla house price trends but treat them as a guide only (and don't rely on a zoopla valuation for an individual property).

Well done on getting that deposit together and good luck!

smile88egc

Don't forget with your help to buy isas the Mac property price if you want the bonus.

Therefore if you save at your current rate for another year, you'll have 26500. More than you need for a 10% deposit (although fees may eat up the rest).

What are the houses I the market that you could see yourselves living in currently priced at?

I'm in Devon in a similar boat, it won't be long before 250k doesn't get you very much, rendering htb isa almost useless.

westernpromise

A couple of points jump out at me from this.

1/ Until you get an AIP you don't really know how much you could borrow - you can only make reasonable estimates based on general non-specific guidance. When I bought in 2012 I knew roughly what I could borrow but the first mortgage application for an actual specific house was rejected because it turned out my other half had an incorrect and damaging bit of information on her credit report. We had to get that changed and the delay nearly lost us the house. So I would get the AIP.

2/ The actual cash costs of buying and moving are non-trivial. You will have to pay for conveyancing, including searches etc; you will probably have to pay stamp duty and this has to be from cash not borrowing; there is the actual cost of moving, whether that's a rented van or a proper firm; and there will always be things that need fixing in the place you buy (it can be a bit depressing to buy somewhere, have no cash left over and end up having to live in someone else's tip for years until you can afford to sort it out).

3/ Be aware that at 3% interest rates you repay about 15% of the mortgage in the first five years. You make a very big dent in the principal very quickly. So even with an initially high LTV mortgage you will probably be in a good position when it comes to remortgaging after those 5 years.

4/ You're both very young. There's a non-trivial risk of relationship breakdown, which always comes as a surprise (if it were foreseeable you'd act on it!) but can be messy where things like property are shared. So I would think about a deed of trust that sets out how ownership is divided.

mildredalien

It really depends on the likely cost of a house given nearby prices and the mortgage you can access. Is £17500 enough to get a 90% LTV mortgage on a house that you might want (and is within affordability), with enough left over for all the costs that go with buying?

As a comparison, we are paying around the amount you have saved on a house deposit (10%), but before we went house hunting we had also saved an extra £8k or so for moving costs. We have budgeted for around £4k fees/costs and £4k initial outlay on redecorating and furniture.

RodgerClarkuk

More deposit better future.


save more. If you can get to equivalent of 15% deposit you get much much cheaper rates. as you are less of a risk of the mortgage company losing money if the market crashes
basic example. £120k house
£600 a month mortgage at 5% deposit on a house
if you had 10% deposit the repayments would be £500 same house same mort company
if you had 15% deposit only pay £400 per month out for the same house.


if you buy 1 year later but have the extra 5% deposit you can save £1,200 per year every year. In 25 yrs
could be £30k better off for saving 6k.


These figures aren't accurate but you get the picture.
Plus - if an issue comes up with the survey renegotiate the offer price and you will always have the possibility of enough spare funds.