Opportunity to buy first house at 16

wiseman405

Hi there,
I am actually only 16.
But my sister at 23 cant afford to buy her first house due to deposit and monthly expenses.

My mum and dad are going to help her and put the deposit down and then obviously in writing own half of the property and pay half the mortgage every month.
They were going to put down £5,000 deposit on a £99,000 flat.

But my dad said if i wanted and thought it would be the right thing i could do it......

I have £5,000 in savings and i will be able to afford the monthly payments.

Do you think this would be a wise move going into property at my age? I want to go into property at 19 and i am saving for my deposit for a house at that age. I am currently saving over my targets.

the flat my sister wants is in the town centre of leeds and is a 1 bed flat.

I know there aren't any questions in there but what would you do?

I am wanting to go into property but do you think i should just save??
My mum doesn't think she will stay in the flat for much longer than 5 years. so at the end of that five years i could maybe buy it off her and use it as a flat to rent?


Thanks
Tom

chriz1000

Well in my opinion you are on the right tracks. I certainly wouldn’t invest your money into your sisters flat though.
Flats are being hit the hardest at the moment by the credit crunch, so in 3 years time when you are ready to move out it could very well be worth less.
This is also 1 bedroom flat, which means there is no chance you can move in and comfortably live with your sister.
I would keep on saving as much as possible, then in 3 years time look at the state of the market and how much you are earning. Hopefully you will have a healthy deposit which you can use for buying a place of your own.

wiseman405

Thanks chriz.
I wouldn't actually move in. I would just use the flat as an investment.
Thanks for your opinion
More are welcome
Tom

G-G_4

I would keep saving and then make up your mind when you are a bit older (don't mean to sound condesending x)..

You will want different things in life when you are older, and with the prices of houses and flats being uncertain at the moment, as Chriz said, in may not be a good investment of your hard earned savings.

To add though, at 16 you have done very very well. I really hope you are proud of yourself..! xxx

Good Luck, whatever you decide.

jatt

Hi,

I have to say you have done very very well at your age and you and your parents will be proud of you.

It's worthwhile to save directly for a house if you can as the market for flats is very tumbling at present.

central

wiseman405 wrote: »

Thanks chriz.
I wouldn't actually move in. I would just use the flat as an investment.
Thanks for your opinion
More are welcome
Tom

Way to go Tom, good lad.

It's important you realise that people are divided about what is going to happen to house prices over the next 2-5 years. Some people think they will hold their value, but some people think they could fall quite a lot, so what you buy now for 110K you will be able to buy for 70K in a few years time. It is impossible to tell which people will be right, but no one thinks that what you buy for 110K now will be worth 140K in 4 or 5 years time. In 25 years time it will be worth about 400K, most people would agree.
Some people would say that you should continue to save and look to buy your firsr house in 2-4 years time.
Hope that helps.

BTman

Will your Sister be paying you any rent?
If not then I can't see whats in it for you (other than a warm feeling for helping out your Sister).
I doubt very much that property will rocket in value over the next few years.
You would be better off opening a cash/equity ISA(MAXI 7K) for the next few years. You should have saved a nice lump sum over 5 years.:beer:

Some might say that property, the stock market and cash will depreciate over the next few years.

wiseman405

Thanks GG

I know where you guys are coming from, and to be honest i would be scared about taking £5,000 out of my savings

I am hoping property will be strong in a few years though i really want to go into it

Cheers
Tom

G-G_4

Well Tom, I think you obviously have a good head on your shoulders and so I would go with your instincts. In life you will make mistakes, but this is what makes you human and what you learn from.

Hope you work it out.. x

Addy1

Hi Tom, well done on the saving bit.

I too worked by guts out and saved every penny when I was your age, by the time I went to Uni I had a nice little bit of money behind me and managed to fund my way through my course.

But I just thought I would point out that I actually found saving easiest at 16-18, because I didn't have any outgoings to speak of.

You may want to carry on saving and put a nice deposit down for a house for yourself once you are ready to move out of home. You will by then hopefully have enough to pay for all those nasty extras that seem to creep up on you as you get older.

Good luck with whatever you do, like I have said before hard work gets you everywhere.

wiseman405

wow, thanks for all the replies.


Well we were going to go 50/50 with the mortgage...She is silly with money doesn't have a clue!!! I give her the advice at 16 :P
yeah i have the mini cash ISA and a couple of savings accounts, but i am limited at my age . Hoping to have £20,000 by 19, although i am well over my target for this year so i may even have 25k for a deposit

Thanks all your help
Tom