Realistic mortgage outlook......

Dstat86

I am in the process of starting to look for my first home and before Covid around March things were looking more promising. 

I am a single male 34, 20k deposit and looking to buy in the midlands area spending 150-180k. I earn around 45-50k a year with a basic salary of 34k. I earn 10-15k a year on top in bonuses. I currently live at home with my mother. I went back 3 years ago to save.
Even after saving hard and feeling like it was in reach I am beginning to get disheartened with the whole process before I've barely begun.

I have spoken to numerous mortgage lenders and also my own bank (natwest). They are all saying at the moment that its not worth bothering without a 15% deposit and then I will need more on top for fees etc. 
There is also now the added worry of house prices falling and being in negative equity etc.
I am finding it all very daunting. Especially doing it alone. 

I am continuing to save to get to the 15% deposit amount but I am really unsure as to what the best option is at the moment?! Should I continue to save and wait until the new year or just go for it?

My post probably doesn't make much sense as I am not 100% sure what I am asking but I don't really have anyone else in this kind of situation I can talk to. All my colleagues and friends that have bought homes did it way before COVID.
I guess I am looking for some reassurance or words of wisdom!
Thank you for reading my ramblings!

joshiesaunt

I think as long as your job is secure then i'd be inclined to wait a year.  There will be a lot more clarity about Covid then and how Brexit is going to play out economically.  Continue to save whilst living at your mum's and throw your next bonus into the pot.  Watch the housing market in your chosen area carefully.

LillyTC

I think you really need to look at your saving. If you’re living at home and earning £50k you should be able to save much more than £20k in three years. Unless you have other financial obligations? I’m not saying don’t spend any money, but I would suggest you think about your priorities. 

If you really don’t want to wait you could look at either Help to Buy or Shared Ownership as that will get you on the property ladder with a smaller deposit, but some drawbacks too. 

Negative equity is only a problem if you’re planning on selling in the short term, over time prices will tend to rise so I wouldn’t get hung up on that. 

Thrugelmir

Are you saving using a LISA. 

Dstat86

Sorry I should have been a little clearer. Its only the last year I have saved properly. 

I have been saving into a natwest savers account. 

Dstat86

Also 50k a year is not guaranteed. My basic is 34k a year and I work in motorsport. I get paid a 'bonus' if I travel away to an event. I may have a month of no travelling which means I would only earn the basic for that month. 

LillyTC

Ah ok, £34k is still a decent salary though. I’m guessing you’re unlikely to get much bonus for a few months due to COVID restrictions on events? Given that most purchases take at least 3 months to complete you’ve got time to save more to cover the additional moving costs such as legal fees. I don’t think you’re too far away from a 15% deposit if you look towards the bottom of your budget. 

But only you can decide if you’re ready to make that step now, it’s a big decision. As I said above, some of it might depend on how long you’d plan to stay in the property to ride out any drops in the market. 

Dstat86

I earnt an extra 1k for August and 2k for September due to events still taking place behind closed doors. I will get an extra 2k for october also so my last 3 pay checks will look the strongest of the year so far. 

I would like to save for another year but do not think I can last another year at home.

GoingOn30

There's a reasonable chance that 90% LTV mortgages will be back before too long so I wouldn't lose hope. 
Knuckle down over the next 2 or 3 months with limiting your outgoings and start researching where you might like to buy, remember the house hunting and subsequent purchasing time can take several months so you'll have more time to save then too. 

sully1311

Dstat86 said:

Sorry I should have been a little clearer. Its only the last year I have saved properly. 

I have been saving into a natwest savers account. 

Urghh, what interest rate is that? Have you not opened a Lifetime ISA?

Steve182

If you can keep up with saving £1K a month you should be in the right ball park for a 15% deposit in around 6 months or so anyway, so you really shouldn't feel disheartened. The time will soon pass.