Cant get on property ladder

dan958

It is extremely dfficult to get on the ladder.

I am in the S/E and bought a 2 bed flat for £165k, 60k of that was cash. I was lucky enough where I was able to stay with my parents until I saved enough (I am 26). I was paying a little rent (like £200 a month) and was able to save nearly everything else. Without having that opportunity, I don't know if I would have ever been able to afford to buy.

Mr_Singleton

Cherry_Burton wrote: »

Why do you say that?

If you can't afford the price to buy outright, what is the alternative? Rent for the rest of your life without an ounce of security, seeing ownership getting further and further out of sight? Shared Ownership is not ideal, and if you can buy 100% that is the best option. For the record, you are a leaseholder just the same as many people who own leasehold flats. They, don't "own" anything either. With Shared Ownership you have the option of buying 100% at a later date. It is an alternative and people have the choice. Many don't want to be at the mercy of private landlords all their lives.

Put all the pro’s of renting & buying in one column and all the con’s in another. Now allocate all the Pro’s to the Housing Association and the Con’s to the leaseholder.

What do I mean? You’ve purchased a 25% share yet your responsible for 100% of the bills. As a renter the landlord pays to service/repair the boiler, paint the exterior of the building etc etc. Despite only being a 25% “owner” you pay all these costs. You”ll pay a premium for a shared ownership mortgage along with all the HA’s legal costs. You have no say in the service charge etc. There are lots of “rules” about shared ownership like if your struggling to pay the rent/mortgage you can’t get a lodger or if you get a job at the other side of the country you can’t rent the property out. Miss a rent payment and HA’s are notorious for starting eviction proceedings at the earliest possible moment. Selling is a whole new world of restrictions and fees/charges.

The number of people staircasing is minuscule as you have to go through the purchasing process again along with £2/3,000 in costs.

I helped some friends get a 25% share of a £300k flat. It’s now worth about £360k so they’ve made a ‘profit’ of £15k. Oddly unlike the bills this is the ONLY time the HA is interested in talking about shares. Once they've deducted the extra costs over straight renting they don’t feel any better off and the only benefit has been they haven’t had to move every 12 months.

How exactly is this “getting on the ladder”?

There is a lot more to this but I’m on a iPad.

Mr_Singleton

dan958 wrote: »

It is extremely dfficult to get on the ladder..

I’ve never said it’s been easy but look at the salary multiples a young person needs to get a mortgage nowadays .... it was never as hard back in the day.

dronid

It's not easy to get on the property ladder and in certain areas, nigh on impossible. I used to live in London but at that time there were still places where you could buy for £150000. Now I wasn't well paid and it took a lot of saving. But it was easier then to get a mortgage and the expectation (not from me, but from the mortgage companies) was that the price would go up, so it was a good investment. Now, there's a risk of a Brexit collapse in the market where people may withdraw capital from the city and available credit has dwindled. This is NOT your fault. Anyone who says they did it...some time ago... well it's not the same world. We ended up moving out of the SE of England where the market is hugely distorted by London and have moved to the North West, to Liverpool as it happens. It's a very different world here. The city has much of what London has but you can buy a house for the same price as a 10% deposit.
Ultimately, the reason is that jobs have become hyperfocussed on London, resulting in so many needing to live there to have a job. However, the rental market has also gone nuts and now you have a job to pay your landlord most of your salary. Standing back from that you'd be better off in a less well paid job somewhere affordable.

Apart from the advice of look somewhere else and make it the way you want it to be, it'll mean borrowing dangerous levels of money and saving, hopefully at a slightly faster rate than the property prices increase at. Good luck

MandM90

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