Can I afford to buy

GINGE93

Hi everyone I am looking for some help. I currently live with my parents and would love my own place. I have been saving and currently have around £8500 saved.

I have found a flat for around £60,000. I have used the mortgage calculator and worked out the mortgage would be around £300.00 a month. I have done a budget plan but it doesn't leave me with much after the bills.

If anyone could have a look and see if this would be a viable option.

Monthly wage: Approx £1100.00
Mortgage: £300.00
Service Charge: £100.00
Electric: £70.00
Water: £20.00
Council Tax: £55.74
Buildings and contents insurance: £10.00
TV & Broadband: £30.00
Mobile: £16.00
Cat insurance: £6.50
Food: £110.00
Petrol: £40.00
Income Protection: £15.00
Life insurance: £7.50
£100.00 for annual costs.

Annual costs:
Car insurance: £700.00
AA Cover: £120.00
MOT: £40.00
Car Tax: £120.00
TV License: £145

I would hate to stretch myself to far and end up in debt. Any advice would be greatly appreciated

KRB2725

What is your current gross income and do you expect this to rise in the foreseeable future?

The insurance figure looks high and you don't appear to have budgeted anything for socialising or birthdays/Christmas?

anto164

GINGE93 wrote: »

Hi everyone I am looking for some help. I currently live with my parents and would love my own place. I have been saving and currently have around £8500 saved.

I have found a flat for around £60,000. I have used the mortgage calculator and worked out the mortgage would be around £300.00 a month. I have done a budget plan but it doesn't leave me with much after the bills.

If anyone could have a look and see if this would be a viable option.

Monthly wage: Approx £1100.00
Mortgage: £300.00
Service Charge: £100.00
Electric: £70.00 (seems high - presuming there is no gas usage?)
Water: £20.00
Council Tax: £55.74
Buildings and contents insurance: £100.00 (seems very high - insurance and contents will only be around £100-150 per year)
TV & Broadband: £30.00
Mobile: £16.00
Cat insurance: £6.50
Food: £110.00 (seems quite low - i would maybe increase this to £200. Once you add in things like a bottle of wine here and there, cleaning detergent etc, it quickly increases the cost)
Petrol: £40.00
Income Protection: £15.00
Life insurance: £7.50
£100.00 for annual costs.

Annual costs:
Car insurance: £700.00
AA Cover: £120.00 (get rid of this and combine it with your car insurance - normally much cheaper. )
MOT: £40.00
Car Tax: £120.00
TV License: £145



I would hate to stretch myself to far and end up in debt. Any advice would be greatly appreciated

I would say that you would also need an allowance to furnish your place and also for general upkeep, if it's your first house / flat, have you got simple things like cooking equipment, pots, pans, plates, utensils etc. Furniture can be a massive drain for instance if you need a sofa, bed, table etc.

However when we got our first place, all our friends and relatives were happy to give us the rubbish that they no longer needed - which we have replaced as and when we can afford or needed to.

Don't forget the cost of purchasing - at your budget there will be no stamp duty, just solicitors fees to pay

davidmcn

Why life insurance, unless you have dependents?
Are you leaving sufficient contingency funds for e.g. fixing/replacing your car?

spadoosh

Your monthly outgoing amount to ~£964.49 with an income of £1100. Leaving £135.51

Youve neglected things like haircuts, dentist, car repairs, property repairs, faulty appliances, socialising, birthdays and xmas.

Do you have all the necessary stuff to kit out an unfurnished flat? You could be talking several hundred pounds in white goods.

Then theres the costs of buying, you could be looking at ~£1500 for that.

Youre not that far away but if i was you i would like more buffers in place. The last thing you want is choosing to pay your mortgage or to eat. Im not sure how much you pay at home (i paid considerably less at hom ethan on my own) but try and take advantage a bit longer. Get a few seperate saving pots going. One for contingencies, one for deposit etc.

You need contingencies in place. Whilst losing your job is bad now you will be ok. Losing your job when you own a house (and losing it) is like one step forward two steps back and will make it incredibly hard work to get back to the position youre currently in.

For now, i would say not viable.

ETA. I know its 'different' but a mortgage is a debt. The lower you can make your mortgage the better rates you get and the less it will cost you. Whilst its a compromise between current affordability and long term cost, try and always stick with the idea that the less you borrow over the shorter time (higher monthly cost) the better.

nubbins

Save up for a min 2 bed and rent a room

csgohan4

interest rates will go up in future, can you afford to take a hit? also maintenance costs with boilers and roofing e.t.c

~Beanie~

Your council tax seems a bit low? I get the single occupancy discount, live in a band A house in a cheap area and mine is £72pm.

GINGE93

Opps the insurance should be £100.00 year not £100.00 per month.

I some furniture in storage and pretty much all the little stuff I'd need.
It would mainly be a fridge as it has a washer and oven.

Lucky I don't have my hat cut often at all. Maybe once every 3 months just for a trim.

I would be hoping to save at least £50.00 towards a rainy day.

I was under the impression you had to have life insurance if you had a mortgage?

GINGE93

I've looked into it and that is the rate with singe rate discount. It's a very cheap area.

davidmcn

GINGE93 wrote: »

I was under the impression you had to have life insurance if you had a mortgage?

Not since the 1990s as far as I'm aware. The mortgage gets repaid by your executors selling the flat, if that doesn't happen then the lender can repossess.