Private investors to help 1st time buyer &TheHouseCrowd

mightykate

Hi
Does anyone know of any process in which you can get a private investor to help buy a residential property?

I work for the NHS full time but I can only get a mortgage on my salary of 101, 000. ish which will get me nothing in the area I have rented in for 11 years. A very basic house in this area with a yard is about 175,000....it's very depressing.

I can't afford to save for a deposit it would take at least 10 years to get a sizeable amount. Unfortunately my family do not have funds to be able to help. I am 43 and feel so despondent that I can't have my own home.

I could maybe beg borrow and steal 5000 pounds but that would still get me very little.

I have just found this site The House Crowd and trying to understand what it is offering but wondered if anyone has any experience of a private funder?

Thanks for reading

AnotherJoe

If a private investor invested in "your" house it would also be "their" house as well. And what would be in it for them ? Their investment might be worth more have more if the house rose in price but they couldn't realise that unless the house was sold.

The options would be buy jointly with a partner, move, and/or take a different job that's better paid.

dimbo61

What do you do in the NHS ?
I work with many NHS staff.
All moved from London because they were paying £1,000 a month for a room and £1,200/1,500 to rent a small flat.
You can buy up north

BLOW_FLY

Hi mightykate the website you refer to thehousecrowd isn't for helping FTB buy a house.

It's for people who want to invest in property to be able to buy shares in property. The company are essentially buying houses to become landlords with multiples of people invested in different houses.

After a few minutes on their website all I can conclude is it's basically people with a bit of money who want to be landlords but can't afford to buy a whole house, give these guys their money and get x% share of a house somewhere to farm someone for cash.

BF

ThePants999

This is what Unmortgage do, I understand.

BLOW_FLY

ThePants999 wrote: »

This is what Unmortgage do, I understand.

I think they're another part buy / part rent company, glossy adverts and lots of fluff around getting your own home, but when you crunch the numbers and look into the finer details you'd be better off renting.

I would imagine also more expensive than using local HA or council for similar scheme.

BF

Cakeguts

You have to do what I did. You have to get a job in an area where you can afford to buy on your own. I lived in an area where I could afford to buy so I changed jobs to an area where I could afford to buy. It wasn't easy because there were not many jobs in my area in the whole country.

agrinnall

jondav wrote: »

Really? Could you tell me the areas where £5000 will cover a 10% deposit, legal fees, moving costs and all other related buying expenses please?

I live in the North and you can't buy with that money!

But the chances are that the OP can only scrape together £5K because their living costs are so higher. If they move to a lower cost area they will be able to save more and after a couple of years be in a position to buy.

davidmcn

jondav wrote: »

Really? Could you tell me the areas where £5000 will cover a 10% deposit, legal fees, moving costs and all other related buying expenses please?

I live in the North and you can't buy with that money!

Buy in Scotland and you don't need any of that deposit nonsense.

AdrianC

mightykate wrote: »

I work for the NHS full time but I can only get a mortgage on my salary of 101, 000. ish which will get me nothing in the area I have rented in for 11 years. A very basic house in this area with a yard is about 175,000....it's very depressing.

Then you need to increase your income.

You say you work for the NHS full time - but it must be a very entry-level position. Can you not increase your skills and go for promotion? Or transfer to work for the NHS in a cheaper part of the country...? The NHS is the ultimate in portable employment. There are hospitals everywhere in the country. £100k would buy a very pleasant modern flat in a nice area, within easy walking distance of my local major hospital.

I am 43 and feel so despondent that I can't have my own home.

You can have your own home. You just won't own it. Ownership is not essential to turn a property into a home - that's just a mental adjustment.

I have just found this site The House Crowd and trying to understand what it is offering but wondered if anyone has any experience of a private funder?

TheHouseCrowd (and other similar sites) focus on crowd-funded buy-to-let, in the main. They set up a company, which borrows money from individual investors to buy a property and manage the letting of it. Not at all what you're after.

Basically, you're asking somebody to take a FAR bigger risk by lending you money than any bank will do. You're asking for a 100% mortgage of nearly twice the income multiple of the traditional market. Why on earth would anybody take that big a risk with their money, except for an interest rate far higher than a normal mortgage? It's not hard to find far safer investment opportunities at twice or even three times the rate you'd normally expect to pay. Which, of course, means far higher repayments - and even at normal mortgage rates, they'd already be a VERY substantial slice of your income.

Let's assume that £100k is 4x income, so you're earning £25k. That's about £1,700/mo after tax. If we ignore the income multiple, and if you could scrape together the 5% deposit and fees, then the VERY cheapest 95% mortgage rate at the moment is 4.5% after introductory discounts have expired. Interest-only, that's £650/mo. But that'll leave you having to find £175,000 or sell the property in 25 years time, when you're 68. Repayment, you're looking at £970/month. That's leaving you £700/month for council tax, all your utilities, clothes, food, travel, EVERYTHING. Including maintaining the property, which is suddenly no longer your landlord's problem...

Ronaldo_Mconaldo

jondav wrote: »

How do you know that? How do you know that they can afford to move at all - that in itself is very expensive.

Our situation (and I guess plenty of others too) is as follows:

The area that we live in is one of the cheapest in the country.
We both have full time jobs that pay a good salary compared to the average in this area.
We live in the smallest flat that we can manage with.
We are metered for water to save money.
Heating is off between March and November, whatever the weather - we wrap up instead.
We have a small amount of debt (less than £2k) that we are trying to clear.
We have no savings.
We do not smoke or drink.

Can you advise me what you would suggest we do to "move to a cheaper area to save money"?

I am really not being argumentative, but life is not always that straight forward.

Rubbish. If all of that is true then your partner must have secret gambling or drug problem because you should be sat on a mountain of spare cash. Me and my wife work part time, we bought a house for £150k eight years ago and paid it all off last September. Dead easy. Now we're living rent and mortgage free and working on buying a bigger house using all the money we're saving.

Don't believe your story at all.