My journey as a First Time Buyer

Oxide

Hello,

I thought I would chronicle my FTB journey and post in this thread as I go for help instead of creating many micro threads along the way.

We are getting married in September and are starting to look now for the right place to live in for the next 5 years. Hopefully after 5 years we will be in a better place to afford our ideal place and move up the ladder.

Fiancee:
33
Works near Clapham Junction
Doesn't drive
£35k per year
Savings £7k
H2B ISA £3.4k

Me:
36
Works near Epsom
£35k per year + £3k bonus
H2B ISA £2.4k
Opened a LISA but will probably move within 12 months
Combined debt £3k

So currently have a £12.8k deposit excluding H2B bonus which means our top limit for a property is 300k.
Our rent is £850/month and we can afford to pay up to £1250/month on a mortgage.
We are not in a rush to find a place but hopefully do by December 2017.

Our search areas are London SW ideally Epsom & Ewell then Chessington, Cheam Village, Leatherhead as they have good transport to Clapham Junction. Areas ruled out are Sutton through to Croydon.
The problem is Epsom and Ewell isn't a London borough so can't take advantage of the London H2B Equity Loan scheme for new properties from 250k to 450k.

This leaves us in a pickle as it seems new properties even remotely suited are over 250k.

We have been considering Share to Buy with the hope that after 5 years we will have more of a pot for our next home (forever-ish home) but after reading these forums I haven't seen too many good things about Share2B and the Housing Associations sound like a mare – however we saw the perfect place (now Under Offer :mad:) in an awesome new development in Ewell for around £200k which is doable.

I guess my question for now is, should we look at buying outright within our budget and not be too happy with it for 5 years or wait until a good Share2B property comes back?

Also I will be looking at mortgages via Habito/Trussle and use a conveyancer from MSE recommended myhomemoveconveyancing.co.uk

For now am I on the right track or have I got this massively wrong?

elverson

Why do you need a new build?

ACG

Find a good local conveyancer.
I have had to deal with good and bad conveyancers. I always prefer my clients to use either someone they have used before and know or my solicitor. They are one of the most important people in the whole process, it is worth getting them right.

As for which option you should go down, personally I am not a massve fan fo shared ownership properties. You only benefit from the portion of any rises, your options for selling are reduced and your options for remortgaging are also reduced. However, at the minute your £800 rent is dead money where as your Mortgage you will benefit from (assuming house prices do not fall).

Best of luck. I am just moving in to my new home which is basically my home for the next 20-30 years, it is an exciting but stressful time. Although my buyer has used a firm of solciitors who did not answer the phone or emails for 2 weeks (which is why I say, get a good solicitors) - and picked up the phone and then hung up because they could not deal with their workload.

illusionek

Have you actually seen a mortgage broker to discuss your situation? You seem to have £12.8k in total, which means you are not in a position right now to afford £300k property. Stamp duty on £300k is £5k, your legal fees will be ca £1 200 then other miscellaneous going to be at least another £1k, so you are left roughly with £5.6k deposit.

Oxide

elverson wrote: »

Why do you need a new build?

Don't need one other than to qualify for the H2B schemes - but still can't find anything used less than 250k at the moment

illusionek wrote: »

Have you actually seen a mortgage broker to discuss your situation? You seem to have £12.8k in total, which means you are not in a position right now to afford £300k property. Stamp duty on £300k is £5k, your legal fees will be ca £1 200 then other miscellaneous going to be at least another £1k, so you are left roughly with £5.6k deposit.

We are hoping that money from the wedding in September will also assist and if it comes to it then money from parents but this is last resort.

I take it I should get a MIP now?

Cakeguts

You earn £70k a year between you. There is only one car and I assume that car is a used one paid for by cash and not on finance since you are saving for a deposit? You only have around £12k in savings and your rent is £850pcm so what on earth are you spending your money on?

You need to start some serious saving for a deposit.

To save for a deposit you need cheap mobile phone contracts or cheap pay as you go phones.
Used car not a new one on finance.
No eating out cook all your own food.
Cheapest broadband/phone/television deal on the market.
No expensive holidays abroad. Stay in the UK and do it cheap.
No new gadgets as soon as they come on the market (you don't need them.)

Go through everything you spend every month and get rid of all the "it only costs this much a month to have x" payments and get rid of them.

It takes effort and a lot of going without to get a deposit together. You can't have everything. If you can't make the effort to save for a deposit you are not ready to be a home owner. Owning a home is expensive and you have to pay for all repairs.

Decide how much you can save a month by cutting out anything you don't need and then do that.

sparky130a

Why not Sutton to Croydon?

Oxide

sparky130a wrote: »

Why not Sutton to Croydon?

Unfortunately my fiancee grew up in this area and has bad vibes with it.

I do think you get more for the money but perhaps as a last resort

kingstreet

The rest of the country calls it Shared Ownership BTW.

'Share To Buy' is just the name of the mortgage brokers Boris licensed to run shared ownership in dat Lundun.

cashbackproblems

Ok I was in your position last year buying solo but the same salary as you have combined with a much larger deposit (80k). I avoided any HTB/Shared equity scheme as when you dig further it just isn't financially worth it, unless prices are dramatically rising which we wont see over the next 5-10 years. Paying rent+mortgage plus paying back the government their share at market rate means you are not fully benefiting. Plus most these new builds this scheme applies to are massively overpriced, high service charges and poorly built.


But the biggest concern, people buying now using HTB and then looking to move up in 2-5yrs, people buying your flats will not have HTB and as they flood the market the high prices e.g. 600k for 2 beds will be totally unaffordable.


I would save a lot bigger deposit and look on the outskirts of London but with good transport links and still in the zones. South London will get you the most of your money

cashbackproblems

Oxide wrote: »

Unfortunately my fiancee grew up in this area and has bad vibes with it.

I do think you get more for the money but perhaps as a last resort

I looked at south Croydon before buying in Bromley and it was a very nice and up and coming area with great train services.