Any first time buyers not getting help?

imogenrose05

Hello all,

I thought i would make a post for those first time buyers like me who are getting zero help from parents and relatives!

How are you finding saving for the deposit whilst renting?
Have you managed to get a mortgage with no problems?
Have you encountered any problems along the way?

I feel like the only person in the world renting and trying to buy simultaneously. Most seem to be getting help from parents for deposit or they live with parents whilst saving!

It's very stressful


Any advice would be warmly received

thank you

bravotango

I find people need to make the odd sacrifice here and there (not going out every night for example, etc, etc) to build up a decent enough deposit.

Interest rates are so low at the minute that people are borrowing crazy amounts of money. Also house prices in London are rocketing and so any chance for people trying to start on the housing ladder remain difficult.

For example, a friend of mine had built up a deposit of £150,000 over the last 5 years, but in London that is not worth much when you realise most of the houses/flats are heavily over-priced.

Also, I know down my road (I live and work in London), people have cash deposits of around £350,000 - £400,000 and so competing with that is very difficult.

alchemist.1

Saved without parental help whilst renting.

Had to sacrifice holidays, nights out and cook at home (the wife). It can be done but you need to prioritise what is important to you.

Tyrone_Black

I'm probably getting a lot less help than most people I know, but some. But I've also only been told about that recently so was planning on not getting any.

I've sacrificed a lot and saved a lot over the past year, but ultimately I now know that if I want to buy I have to move North.

HappyMJ

imogenrose05 wrote: »

Hello all,

I thought i would make a post for those first time buyers like me who are getting zero help from parents and relatives!

How are you finding saving for the deposit whilst renting?
Have you managed to get a mortgage with no problems?
Have you encountered any problems along the way?

I feel like the only person in the world renting and trying to buy simultaneously. Most seem to be getting help from parents for deposit or they live with parents whilst saving!

It's very stressful


Any advice would be warmly received

thank you

You're not the only person in the world in your situation.

I rented the cheapest (habitable) property on the market which was just sufficient for my needs and saved as much as possible by living as if I was earning minimum wage.

I managed to save the difference and once I had 25% of the property I wanted to buy saved in cash I then found no difficulty at all getting a mortgage.

This does not happen in a short period of time as just about everyone seems to expect.

If the house you want to buy is worth £xxx,000 you need to save 0.4% of the value of that property each month for 5 years to get a 25% deposit assuming you invest it well enough to earn a little more than inflation. It's about 20% of your take home pay each month. It's a lot of money. To do that you're going to have to sacrifice a lot. No new cars, no going out "every" weekend, no take aways...etc... That's the really boring bit....

You can buy with a 5% deposit but if you sit down and calculate it then you'll find it's just about always cheaper just to rent as the mortgage payment on 95% of the value of the property plus maintenance, plus insurance/service charges etc will exceed what you would have paid in rent.

NeverAgain2

Buying without help here and currently renting. No big deal - a lot of people are doing it.

Regarding how I saved... exactly that, not spending so much and putting money away. I do get fairly chunky bonuses every few months so they just got popped away until we had 10% deposit ready to go. H2B ISAs are unfortunately useless to us with a limit of 250k when houses start at 280k around here.

You can do it! It's all about prioritising really

amber_man

Bought for the first time at aged 28, after ten years of renting, paying down student loans and saving. Married, partner is a SAHD (so just one wage coming in) and two kids. Never had a bean from either of my parents since I left home at 16, and practical help forthcoming from in-laws in terms of occasional childcare, but no money. We put down a 30% deposit. We do, however, live in a very cheap part of the North and I have a good job and irregular, unpredictable but substantial bonuses.

Kitten868

I know what you mean. It does feel like everyone around you gets handed crazy money. My friend got £30k cash to move in then thousands to buy furniture then thousands to put in 2 new bathrooms that didnt need doing. Insane. But yes we do exist!
I bought on 5% deposit. And now looking at upsizing. Don't focus on the pity party but how youre learning lessons that will put you in a better position for life I was first of my friends to buy. X

ruelle

bravotango wrote: »

I find people need to make the odd sacrifice here and there (not going out every night for example, etc, etc) to build up a decent enough deposit.

Interest rates are so low at the minute that people are borrowing crazy amounts of money. Also house prices in London are rocketing and so any chance for people trying to start on the housing ladder remain difficult.

For example, a friend of mine had built up a deposit of £150,000 over the last 5 years, but in London that is not worth much when you realise most of the houses/flats are heavily over-priced.

Also, I know down my road (I live and work in London), people have cash deposits of around £350,000 - £400,000 and so competing with that is very difficult.

£150k in 5 years....??! i didn't get any help from my parents. i am lucky in that my rent is v cheap for london. it probably took me around 9 years to save £60k. i'm only now on a decent enough salary to get an ok mortgage on my own too. it can be done!

mildredalien

My husband and I are in the process of buying our first home and have saved the entire deposit and all fees/costs money ourselves. We did originally have some set aside from an inheritance but unfortunately DH was too unwell to work for a few months in a job with no sick pay, that and an old debt that he thought had been sorted wiped that out so it's been all our savings!

For me, what helped was having my 'light bulb moment' when I was in my late 20s and paying off about £10k of debt in 12 months. That helped me to see that I really don't have to spend everything I earn - I learned to budget properly, shop around, get good deals and prioritise what I really wanted to spend my money on. I shared a cheap houseshare for a couple of years which helped, it wasn't as nice as having a place of my own but it was very good for the budget.

We've managed to save for a house deposit, a wedding and honeymoon over the past few years. I would say however that my husband and I are both lucky enough to work in fairly well paid jobs. We aren't high paid financiers or in jobs that get big bonuses, but we earn well over the average and our salaries have each doubled over the past 6 or 7 years. At each pay increase we re-evaluate our budget, we might spend a little more on treats or trips but we also squirrel more away into savings.

We haven't had any major problems with our mortgage as we stayed well within affordability and didn't apply until our credit records were clear (barring one badly timed incorrect entry but fortunately we were able to prove it wasn't right).

smile88egc

I feel your pain! A friend has just been given 20k from her parents, won't go too far since we are south-west but it feels hard to do it without help. I'm hoping my rents will help with fees etc but we are saving the deposit ourselves, and have been for about 3.5 years. We are still 12-15 months away but we're getting there! Trying to get to 20% but not prepared to give up an annual holiday so it's taking us a bit longer. We still have a lifestyle not too dissimilar to my student days 5 years after graduating so it's going to be bliss when we no longer have to save quite this hard! We are hoping to get a 25 year term, none of this 35 year silliness.