Anxious about buying - any help hugely appreciated.

Cambsalex

Hello all.

I'm in my mid thirtees and single currently going through the process of buying my first home a one bed flat in Hertfordshire, but the process is causing me huge stress and anxiety because I don't know what the right thing to do is. 

I agreed a price of 215k before mortgage rates rocketed based on a deposit of 90k (most of my savings) and a rate of just 2.2% for a 5 year fixed. The intention is to buy for a couple of years and hopefully sell to move to a house. As the process has gone on alot has changed with mortgage rates and house prices. My mortgage advisor has told me that in a couple of years the flat could well be worth less. I'm seeing house prices dropping in the area for the first time and am wondering if I held off perhaps mortgage rates would drop enough for me to be able to afford a house in the nearish future. I've never lived in a flat. I currently rent a 2 bed house and am a little anxious about moving to a flat, but I feel that getting on the property ladder is important.

I would love to know if anyone here would have an opinion on what to do. Complete and live in a small flat for a couple of years and sell, or hold off in the hope it becomes possible to buy a house (these are currently around £250k upwards in my area for a basic house - out of my price range just about). 

Any help appreciated. I have no one to give me advice and the fear of doing the wrong thing makes me anxious and unhappy.

Thank you for reading.

Woolsery

FOMO is hard to resist and whenever there is serious downturn 1 bed flats are hit fast and hardest to sell.

Personally, if you can afford to stay where you are and are OK there, I would, but that's me. Others will have other opinions. None of us has the prescience to know how things will play out economically from here, but it's obvious we are headed into something bad. That being the case, the security of your employment would be the thing I'd think hardest about before taking on more debt and fixing your location permanently. If you think you could be happy in a 1 bed flat for the 5 year term it might still work out at the low rate quoted, but only you know what compromises you're prepared to make.

HWBY

If anyone could tell the future they'd be very rich indeed. But personally, I wouldn't buy a one-bed flat right now with the intention of moving again in a few years in anticipation of it being hard to shift and possible loss of value.

GixerKate

I'm usually one for saying get on the housing ladder as soon as you can and the future will sort itself out however, there isn't much difference between the price of the flat you have agreed to buy and house prices you've quoted so its hard for me to answer.

In my opinion a house is always going to be better than a flat and the market is almost always kinder to houses than flats - flats always are the hardest hit when things go bad.

How quickly would you be able to save enough of a deposit for a 250k house?  that would sway my decision if it were me.  If I thought I would be able to save that in say 6 months I might well hold out for the house.  Also, another factor is outgoings, how do you stand comparing the outgoings from where you are now to if you owned the flat?  If you are better off in the flat you then get to save faster for the house.

Not sure there is a right answer here.  Good luck with it all, its certainly scary when you are doing it for the first time and definitely if you are doing it by yourself.

diystarter7

"a couple of years sell."  That is not an ideal plan. However, if prices went up a bit then fair enough but other than developers, most buyers do not sell after 2 years for cost/upheaval etc reasons.

Something to consider: Have you ever lived in an apartment and are you fussy like me?  Apartments may look very welcoming often a service charge can easily go up rather than down. Then the noise possibly from above/below/sides and from the outside of your front door and the smells and people leaving stuff in communal areas/etc. If you not a smoker and hate the smell, then be aware of smells re this and people opening their widows and smoking or not and smell comes into the hall etc.

Then the place you are buying, are their shared, HA properties as that puts some buyers off.

If you can afford a house then go for that but as you wait, prices could go up or down.

pinkshoes

Cambsalex said:

Hello all.

I'm in my mid thirtees and single currently going through the process of buying my first home a one bed flat in Hertfordshire, but the process is causing me huge stress and anxiety because I don't know what the right thing to do is. 

I agreed a price of 215k before mortgage rates rocketed based on a deposit of 90k (most of my savings) and a rate of just 2.2% for a 5 year fixed. The intention is to buy for a couple of years and hopefully sell to move to a house. As the process has gone on alot has changed with mortgage rates and house prices. My mortgage advisor has told me that in a couple of years the flat could well be worth less. I'm seeing house prices dropping in the area for the first time and am wondering if I held off perhaps mortgage rates would drop enough for me to be able to afford a house in the nearish future. I've never lived in a flat. I currently rent a 2 bed house and am a little anxious about moving to a flat, but I feel that getting on the property ladder is important.

I would love to know if anyone here would have an opinion on what to do. Complete and live in a small flat for a couple of years and sell, or hold off in the hope it becomes possible to buy a house (these are currently around £250k upwards in my area for a basic house - out of my price range just about). 

Any help appreciated. I have no one to give me advice and the fear of doing the wrong thing makes me anxious and unhappy.

Thank you for reading.

Personally I don't see a property purchase as a 2 year thing...

1 bedroom properties have a very limited market when it comes to selling (only suitable for single people or childless couples) so if the market does continue to struggle you could end up either stuck there or becoming a landlord. 

As there is only £35k between a 1 bed flat and a basic house, I'd go live like a hermit for a couple of years, save more money and go for the house where you can potentially stay forever!

sheramber

And mortgage rates  have gone up.

Sarah1Mitty2

Putting "most of your savings" into a property is a very very bad idea.

london21

When does your current mortgage offer end?

Do they allow you to change property without having to choose a new product?

You have secured a good rate and now same will be 5%+

If it is long term, you will be ok but short term there could be changes.

Personally, would go for a 2 bedroom not 1 because more flexibility.

SadieO

Sarah1Mitty2 said:

Putting "most of your savings" into a property is a very very bad idea.

Genuine question - why? And how else would people become homeowners other than by saving up and then using that money as a deposit?

SprostonGreenHead

Sarah1Mitty2 said:

Putting "most of your savings" into a property is a very very bad idea.

Really?

Surely the vast majority of people do this. Your house is likely to be (for most people) the most valuable asset you own (or are paying off a loan on, to own). Seems to me entirely normal and not at all a bad idea to put "most" (which is any amount over 50%) of your savings into a deposit for a home.