How has this house gone up so much?

Herzlos

Mark_Glasses said:

I don't think you can buy a house up North for £125k. For example one of my school friends never moved out of Leeds and he paid £359,950 for his house. He thinks I must be rich with my job in London yet he paid more for his property than I did.

Rightmove has 3,448 houses within 40 miles of Newcastle for under £125k. Some of them look pretty nice. Some will also be horrific but I'm not going through them all.

Houses here are selling for under £125k as well. Usually small-ish 2 bed semis.

My point was largely that even if you lose your job and become unemployable, you've got enough equity in your existing flat to buy something outright. That you've already got a huge safety net and not at any real risk of being homeless, cold or starving. You're in a position you don't need to worry about money.

Hell, I'm sure that with your equity and savings alone you could buy my 4-bed house outright (£250k).  I've got 25 years to wait to be in that position.

EssexHebridean

Guessing you've not actually looked at property prices in the "London" areas that have been suggested. Plenty around the Romford area for sub-£400k. As for commute time, something in say the Gidea Park area would take you somewhere just over 30 minutes on the tube. 

Ultimately - it comes down to a question of whether the big thing here is wanting to live in a house, or just wanting your current property to miraculously morph into a million pound house. One of those two things it is perfectly possible for you to make happen...the other is pie in the sky, and you will waste a lot of your life waiting for it.  

Elliott.T123

Mark_Glasses said:

I find it hard to believe we're in the top 2%. I feel like most people make more money than me. I did have one friend reveal he only makes £35k a year and I did tell him I don't make much more than that because that's how I felt. 

I don't think you can buy a house up North for £125k. For example one of my school friends never moved out of Leeds and he paid £359,950 for his house. He thinks I must be rich with my job in London yet he paid more for his property than I did.

@Elliott.T123 It doesn't feel much higher. I was thinking it's closer to £50k than it is to £100k. 

I don't live in Central London, it would cost over £1million to live there. I know someone who does live in Central London and they paid £455k for their one bed flat. He thinks my area of London would be too far out to live.

How accurate are those calculators? I know you need to provide bank statements and I think the reason for this is so they can review your spending habits and reduce the amount they're willing to lend you. If I could buy somewhere for £535k then at least I'd know it's possible for it to be worth £975k in years to come.

Mark, in response to above:

1. You are definitely in the top 5% no doubt but by most metrics you are around the top 2%. Your views are skewed by a number of factors...

You tend to associate with people your level and above, how many of your close friends work in Tesco or are cleaners or similar? I suspect most of your friends are also earning well. You also live in London and there are far more highly paid individuals there so if you took London only then you wont be in the top 2%.

The other factor is your saving habits. You told us you save a lot each month (I cant be bothered to go back through the thread but if I remember it was £1500-1600 possibly more) most people do not do anything close to that. If you started spending an extra £1300 - 1400 a month would you feel richer? That is what most people are doing. I know people who earn £100k a year plus and have hardly a penny saved as their outgoings are equal to income. 

You most definitely can buy a house for that sort of Money, I have family close to the Scottish border, one bought a 3 bed terrace recently for £100k another is selling their 4 bed detached for £175k.

2. Stop working in £50k multiples, £74,999 is closer to £50k than £100k does that mean its not much more than £50k.. no it is 50% higher!

3. The calculators are pretty accurate, yes if you have certain spending habits they will reduce but with your saving you will have no issues getting close to the max if you wanted.

Finally you said.... "If I could buy somewhere for £535k then at least I'd know it's possible for it to be worth £975k in years to come."

DO NOT LOOK AT IT LIKE THAT!!!!

If that is why you are buying a house stop right now, it is a terrible decision, you said you wished you had more financial acumen well here is the advice. Property at this point is not a solid investment, in London since 2019 prices have risen 11% compared to 20% nationally. If you invested your savings in an index linked tracker in 2019 they would have grown roughly 85% since then (S&P 500).

Buy a property because you want to live in it not because it is an investment. If it makes money that is an added bonus. The other thing to think about is if you are using property to make money what is your endgame?

Say for argument sake you buy a £500k property, in 20 years time prices have doubled and its worth £1m.
You decide to sell and want to retire but still want to live in a nice house because you have become used to that... You are looking at similar cost to move and you don't see any of that cash.

RelievedSheff

Mark_Glasses said:

@EssexHebridean Romford and Dagenham are in London aren't they? Certainly inside the M25 and you have the London Borough of Barking and Dagenham. How is your commute so quick? It can take me that long if I'm waiting long enough for tubes to turn up. I would imagine you'd still be looking at £500k+ for houses in Romford or Dagenham.

@Herzlos do you have any resources you've found useful? 

I am qualified to do my occupation which exists in every industry more or less. I don't mind my occupation but I really hate my industry. I've been trying to change industries for years but with no success. 

I find it hard to believe we're in the top 2%. I feel like most people make more money than me. I did have one friend reveal he only makes £35k a year and I did tell him I don't make much more than that because that's how I felt. 

I don't think you can buy a house up North for £125k. For example one of my school friends never moved out of Leeds and he paid £359,950 for his house. He thinks I must be rich with my job in London yet he paid more for his property than I did.

@Elliott.T123 It doesn't feel much higher. I was thinking it's closer to £50k than it is to £100k. 

I don't live in Central London, it would cost over £1million to live there. I know someone who does live in Central London and they paid £455k for their one bed flat. He thinks my area of London would be too far out to live.

How accurate are those calculators? I know you need to provide bank statements and I think the reason for this is so they can review your spending habits and reduce the amount they're willing to lend you. If I could buy somewhere for £535k then at least I'd know it's possible for it to be worth £975k in years to come.

You certainly can buy a house up North for £125k. A lot less in some places.

A colleague of mine has just bought his first house at the age of 29. He has paid £125k for a 3 bed terraced in an alright area of Sheffield.

Where we live in Worksop you would get a nice starter home or flat for £125k. 

https://www.rightmove.co.uk/properties/138800345#/?channel=RES_BUY

https://www.rightmove.co.uk/properties/141387524#/?channel=RES_BUY

You can even pick up a 1 bed flat for £50k (or less)

https://www.rightmove.co.uk/properties/140848274#/?channel=RES_BUY

https://www.rightmove.co.uk/properties/135100817#/?channel=RES_BUY

https://www.rightmove.co.uk/properties/139456151#/?channel=RES_BUY

We bought here because prices are more reasonable than in Sheffield. We bought a new build 3 bed detached with garage in a nice area for a very reasonable price in 2019. We kept our jobs in Sheffield as we have both had them for over 20 years and we both earn a good wage for our jobs. The commute isn't that bad, we share the one car as we only work around the corner from each other.

Our house will never be worth a million, no. But it will be paid for within the next ten years. 

BlueVeranda

Elliott.T123 said:

Finally you said.... "If I could buy somewhere for £535k then at least I'd know it's possible for it to be worth £975k in years to come."

DO NOT LOOK AT IT LIKE THAT!!!!

If that is why you are buying a house stop right now, it is a terrible decision, 

Those figures are what his mate bought and sold for, which is another reason to stop right there. Buy a house for 535k by all means, but live in it, enjoy it, and if you happen to approximately double the value on selling it, that's a bonus but it's never guaranteed. And you're not a failure if you don't, even if you know someone else who did.

MeteredOut

OP, has your outlook on this issue (in your mind) changed since you started this thread 3 months ago?

I'm not exactly sure whether any more advice can be given, as you seem to want either be able to turn back time, or somehow afford a better house than your significantly-above-average income allows you to have.

Mark_Glasses

@herzlos I get the impression most people where I work get more money than me. That said a lot of them are passionate about the industry and it's known that there's enough people who love it enough to accept being underpaid. We don't have receptionists, security staff etc. but I take your point. I have a friend in his 50s who has always done low skilled jobs and he bought a house in East London in the 90s when it was much cheaper but now he's mortgage free and his house is worth £800k. 

I've always known that those who were old enough to buy in the 90s are in a strong position but I've now seen it's possible for someone my age to be in a strong position too and I want to be one of those people.

If I did become unemployable and bought a property up North for £125k but then needed a new roof how would I pay for it? That's not to mention how I would pay for day to day living costs. 

@EssexHebridean no I've not looked at house prices there but I just know I live in a cheap part of London. I have a friend who has bought a flat in Gidea Park for £500k so I would imagine houses would cost more. 

@Elliott.T123 I have a friend who's a delivery driver but he's paid off his mortgage. I've never really increased my spending as my salary has gone up. If anything I'm tighter with my money than I was when I was making £14k a year when I think of some of the things I spent money on back then. That said I was taking home £973 a month and I do spend more than £973 most months which is quite scary. I don't know how I would cope now on a £14k salary.

Ideally I would want to be a millionaire now and drive a Porsche and go skiing. At the very least though when I'm on my deathbed I want to be able to look back on my life and be proud of becoming a millionaire.

@RelievedSheff I've never even heard of Workshop and if it's near Sheffield it must be near to Leeds too which is where I come from. There must be something seriously wrong with that flat if it only costs £15k.

@BlueVeranda it just seems that whenever I get to the next milestone he's raced well ahead. When he was living in a flat in London and we were getting close to buying ours it looked like he could be caught until he bought his house just before we bought our flat. Now it looks like he can never be caught.

@MeteredOut has it really been 3 months? this highlights the problem, I'm trying my best to get ahead but time keeps pushing me behind.

Herzlos

Mark_Glasses said:
I've always known that those who were old enough to buy in the 90s are in a strong position but I've now seen it's possible for someone my age to be in a strong position too and I want to be one of those people.

You're already in a strong position. You're just not (and not likely to be) a paper millionaire. It's just a number.

Mark_Glasses said:
If I did become unemployable and bought a property up North for £125k but then needed a new roof how would I pay for it? That's not to mention how I would pay for day to day living costs.

You'd get some kind of benefits that'd cover your living costs. I'm talking about a total worst case scenario, and how you face pretty much no chance of being homeless or starving.

Mark_Glasses said:
Ideally I would want to be a millionaire now and drive a Porsche and go skiing. At the very least though when I'm on my deathbed I want to be able to look back on my life and be proud of becoming a millionaire.

It sounds like you could already drive a Porsche and go skiiing if you weren't being so stingy.

But are those things you and your wife actually want to do, or are they things you feel other people do because they are rich?

Admittedly I live a lot closer to the Cairngorms than you, but I can go skiing for a weekend for maybe £200. Of course I assume you're talking about going to the Alps for a week in a nice cabin and not a B&B for a weekend.

What do you think will be different if you have £1,000,000 in assets?

I have to admit that of all the things I'd consider being proud of on my deathbed, how much money I made wouldn't even cross my mind. But maybe that's why I'm skint.

Mark_Glasses said:

 it just seems that whenever I get to the next milestone he's raced well ahead. When he was living in a flat in London and we were getting close to buying ours it looked like he could be caught until he bought his house just before we bought our flat. Now it looks like he can never be caught.

That way only lies madness. You can't win by keeping up with other people, especially where luck is involved.
If he won £1m on the lottery, would you be on here asking what ticket you need to buy to win too?

RelievedSheff

Mark_Glasses said:

.

@RelievedSheff I've never even heard of Workshop and if it's near Sheffield it must be near to Leeds too which is where I come from. There must be something seriously wrong with that flat if it only costs £15k.

Nothing wrong with it. Its currently tenanted but otherwise ready to go. We walk past it whenever we go into the town centre.

Elliott.T123

Mark_Glasses said:

@Elliott.T123 I have a friend who's a delivery driver but he's paid off his mortgage. I've never really increased my spending as my salary has gone up. If anything I'm tighter with my money than I was when I was making £14k a year when I think of some of the things I spent money on back then. That said I was taking home £973 a month and I do spend more than £973 most months which is quite scary. I don't know how I would cope now on a £14k salary.

Ideally I would want to be a millionaire now and drive a Porsche and go skiing. At the very least though when I'm on my deathbed I want to be able to look back on my life and be proud of becoming a millionaire.

You are forgetting about inflation, of course you are spending more now than you did when you first started work!

You could finance a brand new Porsche 911 for around £1300 a month and be left with over £3,000 to spend on ski holidays if you spent all the money you are currently saving each year on doing things.

Obviously this is terrible financial advice but it shows you that realistically you could do what you want. Instead of a brand new 911, buy a second hand Cayman or Boxter.

This is going to be my last post on this thread as we have not moved on at all in the last 3 months.... but the issue here Mark is your total and complete obsession with the word millionaire. You don't even know why you want to be a millionaire other than to say I was a millionaire. Forget it, enjoy your life, live your life. You are in the top 2-5% in the country so go and enjoy your life as though you are instead of acting like you don't know where the next meal is coming from. Go on that ski trip you want to have, treat your wife to that new (inset whatever your wife likes), buy that Porsche. forget about some random number that will make no difference whatsoever to your life and instead focus on enjoying there here and now!

How would you feel if you got hit by a bus tomorrow and realised you could have enjoyed the last 5 years, done the things you wanted to do but instead spent that time stressed and worried about saving for the sake of saying you may hit a random number one day in the future.