Is the property ladder now a myth?

lookstraightahead

redundantmortgage said:

There's currently a 3 bed detached house with drive, garage and front and back gardens near my parents that's for sale for slightly less than my 1 bed flat which I've nearly paid the mortgage off for. My mum thinks I should buy it and commute to work because it will give me the mortgage free existence I've desired all my life.

However the cost of the train fare, parking at the station and petrol to drive to the station would collectively cost me £13.5k a year. If that was to go up 3.8% each year like the train fare is going to do this year then that will cost around £550k over the next 25 years. My wife would have to do the same but we'd have to commute separately because we don't work the same hours. That's £1.1 million over the next 25 years.

OK this is an extreme example but the point is that moving further out and commuting won't always be more cost effective.

I am looking to upgrade to a house and it's looking like I'm going to end up borrowing more than I borrowed to get on the property ladder in the first place which is depressing.

What I'm finding to my cost is that trying to be sensible by saving a big deposit and buying somewhere I can comfortably afford isn't sensible at all. Had I taken the plunge earlier I'd probably be in my house by now but instead I'm wondering whether I'll be able to afford one at all.

To be honest most people are or have been in this position. The balance between being able to get a higher mortgage and commuter costs has always been difficult.

I have spent a fortune on commuting in the past. The problem is sometimes banks can't see further than their noses and it's about ticking boxes.

Being mortgage free is not always the best financial option.

LadyCoconut78

I am standing at the bottom of the ladder as 43 year old single woman looking to buy her first flat in the South East.  

I have a 10% deposit and a healthy mortgage in principle however I am totally uninspired by what is on offer because it being the South East then its over priced by a country mile - 2 bedroom apartments for £450K (no garden). I could buy this but I just happen to think that its not worth the money. I am here in the South East because my brother is and its been so nice having family nearby again in particular through this awful pandemic.  

I feel I am at a crossroads - buy a flat and just suck it up OR continue renting and continue investing (get a financial advisor) OR move further away from family all so I can buy a property when in fact it really doesn't interest me to do so despite going to view properties and having a mortgage in principle. 

I'm on the outside looking in and thinking I don't want to know.  

m0t

wilfred30 said:

Are you saying that you've got one double and three single bedrooms?

If so, when you converted your loft, did you only add a single bedroom rather than a double?

Our main bedroom has a king-size bed in it, the other three rooms are singles. You could probably get a double in a couple of them if you didn't want your clothes in the room.

We added a bedroom and a bathroom. Our house had a small bathroom on the ground floor off the kitchen.

penners324 said:

As alluded to in a previous post, part of being on the property ladder is also moving up the career ladder...

The financial benefit of moving  up each rung of the public sector career ladder is small but the additional responsibility/time commitment is quite large and you have to accept that you will become further divorced from delivering things for the public (which is why many of us wanted to work in the public sector in the first place). Whilst we have salary ranges for jobs it's impossible to move through them regardless of individual performance.

I could jump to the private sector and solve some of the financial issues though.

anotheruser

redundantmortgage said:

However the cost of the train fare, parking at the station and petrol to drive to the station would collectively cost me £13.5k a year. If that was to go up 3.8% each year like the train fare is going to do this year then that will cost around £550k over the next 25 years. My wife would have to do the same but we'd have to commute separately because we don't work the same hours. That's £1.1 million over the next 25 years.

Could you supply the details of how you have come to the £13.5k a year?
I can't think of any station + train ticket that would cost that much, even into London (you're not choosing a main station are you?).
I commute 60 miles a day and although fuel is priced higher than what it was 5 years ago, I still make more money than in my old job barely 10 miles a day.

london21

I really do not know how the government expects the younger generation to afford or get on the property ladder at the rate prices are rising.

The HTB save £4000 get £1000 won't get far with the prices. 

rexmedorum

anotheruser said:

redundantmortgage said:

However the cost of the train fare, parking at the station and petrol to drive to the station would collectively cost me £13.5k a year. If that was to go up 3.8% each year like the train fare is going to do this year then that will cost around £550k over the next 25 years. My wife would have to do the same but we'd have to commute separately because we don't work the same hours. That's £1.1 million over the next 25 years.

Could you supply the details of how you have come to the £13.5k a year?
I can't think of any station + train ticket that would cost that much, even into London (you're not choosing a main station are you?).
I commute 60 miles a day and although fuel is priced higher than what it was 5 years ago, I still make more money than in my old job barely 10 miles a day.

It's not that inconceivable. I don't work in London but if I did a season ticket would be £9k+ from here + £9/day parking at the station + london travel card would get me close to that figure as well.

diggingdude

One thing a lot of people forget about is salary when looking at prices up north. Yes you can buy a big house for £190k but wages may only be £25k. So houses can be equally unaffordable for locals. 

Slithery

diggingdude said:

One thing a lot of people forget about is salary when looking at prices up north. Yes you can buy a big house for £190k but wages may only be £25k. So houses can be equally unaffordable for locals. 

I live in the south and my wages are only £19k. If I transfered to somewhere more northern in the same company that wouldn't change so housing would be much more affordable.

RelievedSheff

diggingdude said:

One thing a lot of people forget about is salary when looking at prices up north. Yes you can buy a big house for £190k but wages may only be £25k. So houses can be equally unaffordable for locals. 

Depends on your job and where exactly you live.

We live in Nottinghamshire where house prices are below the national average yet our wages are above the national average. 

lookstraightahead

london21 said:

I really do not know how the government expects the younger generation to afford or get on the property ladder at the rate prices are rising.

The HTB save £4000 get £1000 won't get far with the prices. 

Every generation has had its problems with house buying. It really isn't just the younger generation either.