We really can't afford the house we want/need will things get better for us or just forget it?

Ally_E.

3 years ago our budget was 45.45% of what it is today. So yes, it's not over for you, your situation can change and might be able to afford a more expensive house. Keep working hard to get there.

mrsmortgage

badger09 said:

I'm really confused.
Why do you have a hard deadline for moving?
When did 'cross-country' come into play? I thought you couldn't move far as children couldn't change schools due to shared custody.
Where is 'over there', where houses are much cheaper? Is it the same place as you could be making double what you earn now?

If none of this is relevant, or has been covered before, please ignore me:

Because that's the earliest we can move (8/7 years). The older children would have gone to Uni or if they haven't they can make a choice of moving with us. The cross-country has always been something we've always planned, we've never said we'll live here forever. 
Some areas in the south/east midlands are actually cheaper than where we live, but there are many more jobs in my field and also better paid. 

mrsmortgage

Ally_E. said:

3 years ago our budget was 45.45% of what it is today. So yes, it's not over for you, your situation can change and might be able to afford a more expensive house. Keep working hard to get there.

Absolutely! in one year we've been able to increase our potential mortgage by £100k! Which would be 50% more than before  

Justonemorecupoftea

mrsmortgage said:

Justonemorecupoftea said:

If your salary has gone up meaning you can borrow, does that mean it's the deposit that's the issue? Could you look at a 5% ltv product?
How much equity do you have in your current house (also has the been valued recently)?
Or is it repayments on the bigger borrowing?

Either way it sounds like you might have to make a few lifestyle changes. Either a few years of less expensive holidays, Christmas gifts etc to get a better deposit (whilst also increasing equity) or a look at budgeting to increase your affordability.

even with a 5% mortgage, they wouldn't lend us enough, it's not like they then lend you 6x our joint salaries . Our current equity is around £40k, so not too bad. Yes, it has been valued recently, and if I take that valuation then the equity would be up to £70k, so I'm taking a more sensible approach to much equity we've built. 

I was underemployed for 3 years, we didn't have any holidays, we don't spend more than £50 for Xmas on each of the kiddos, we've had to live frugally as we didn't have a choice. 

Now that we have more disposable income we'd rather enjoy it as they were somewhat tough years. 

I you sell the house at what it's valued at (not unreasonable assumption) then that's an additional £30k on your budget - you're saying you are consistently £30-50k under - doesn't that at least partially solve your problem?

Tiddleshalifax

hazyjo said:

Look for something with a bedroom less that can be extended or converted. That'd solve your problem and prob be cheaper.

The people we are buying from have gone for a 4 bed and are planning to extend due to a lack of suitable property! Great advice 😍

mrsmortgage

Justonemorecupoftea said:

I you sell the house at what it's valued at (not unreasonable assumption) then that's an additional £30k on your budget - you're saying you are consistently £30-50k under - doesn't that at least partially solve your problem?

If our house dopes sell for £260k, that for a sake of this debate let's say it does... We'd have £70k equity. Bank lends 285k, which takes us to £355k, my family gives us £20k, that takes us to £375k and change... Most houses are on the market for £425k, which is around the £50k sum. Some will take £400k, so that's £25k. I think realistically that would take 3 years to save. I think the gap will always be the same give or take. 

lookstraightahead

mrsmortgage said:

Justonemorecupoftea said:

I you sell the house at what it's valued at (not unreasonable assumption) then that's an additional £30k on your budget - you're saying you are consistently £30-50k under - doesn't that at least partially solve your problem?

If our house dopes sell for £260k, that for a sake of this debate let's say it does... We'd have £70k equity. Bank lends 285k, which takes us to £355k, my family gives us £20k, that takes us to £375k and change... Most houses are on the market for £425k, which is around the £50k sum. Some will take £400k, so that's £25k. I think realistically that would take 3 years to save. I think the gap will always be the same give or take. 

So you're on a joint salary of, say, £55000. You have 4(?) children at home and you might need to extend etc. 

Can you actually afford a mortgage that high? With all the costs of a bigger house? 

Interest rates are extremely low at the moment - what if they double/triple? 

mrsmortgage

lookstraightahead said:

So you're on a joint salary of, say, £55000. You have 4(?) children at home and you might need to extend etc. 

Can you actually afford a mortgage that high? With all the costs of a bigger house? 

Interest rates are extremely low at the moment - what if they double/triple? 

It's closer to £60k, plus bonuses but yes thereabouts. I also have foreign income of £700 pcm which makes life a lot easier. Our current expenses are of £2400 pcm, but that includes two repayments, in a couple of months that will be reduced to £2200. Our joint income after tax is of £3900, so those £1700 are completely disposable. We'll stop paying nursery fees in like 18 months, so that will at least take it to say £2k pcm of completely disposable income, plus pay rises etc... 

I know that if it REALLY came to it, I could sell my foreign property that is worth around £300k (but that's only if we're for some reason in any danger of losing our house), otherwise we'd rather have the extra income. 
and I'm not taking into account child benefit, we save that one religiously. 

mrsmortgage

We also wouldn't buy anything at the top end of our affordability if it doesn't work for us from the start... If we had to buy something that we'd have to improve/extend we'd have to leave enough from our equity to pay for it. 

sharp910sh

mrsmortgage said:

lookstraightahead said:

So you're on a joint salary of, say, £55000. You have 4(?) children at home and you might need to extend etc. 

Can you actually afford a mortgage that high? With all the costs of a bigger house? 

Interest rates are extremely low at the moment - what if they double/triple? 

It's closer to £60k, plus bonuses but yes thereabouts. I also have foreign income of £700 pcm which makes life a lot easier. Our current expenses are of £2400 pcm, but that includes two repayments, in a couple of months that will be reduced to £2200. Our joint income after tax is of £3900, so those £1700 are completely disposable. We'll stop paying nursery fees in like 18 months, so that will at least take it to say £2k pcm of completely disposable income, plus pay rises etc... 

I know that if it REALLY came to it, I could sell my foreign property that is worth around £300k (but that's only if we're for some reason in any danger of losing our house), otherwise we'd rather have the extra income. 
and I'm not taking into account child benefit, we save that one religiously. 

Sounds like you need to sell your foreign property if you want the house you want. No point having extra income if you cannot live the life you want. Does the mortgage company take into consideration your £700 a month you receive? That would increase your mortgage amount by circa £45k, making you be able to afford your £425 house.