Worried First Time Buyer - In Too Deep?

Steel_2

Although you could afford this house if you scrimp and save, if anything unexpected happened you'd be up a creek. At the moment you are probably estimating the bills so they may be higher when you move in.

You could end up with a home but no money to do anything but look at each other and four walls, and when money is tight for a long time it can cause tensions between couples.

Don't base a financial decision of this size on the fact that your wages will probably go up. It means you're spending imaginary money before you get it - you can only work with the money you have now. If one of you got made redundant or had an accident, there will be only one wage covering everything. Even if you have insurance they can take a few months to pay out and in the meantime you still have to cover everything.

To put this into perspective and give you some more figures to consider, hubby and I bought a 3 bed 1950s semi three years ago for 176,00. We borrowed £100k, the rest was equity. He brings in 24K, I bring in around £16k in a good year (I'm self employed). During the three years we've been here our bills (including repairs, maintenance, council tax etc) has DOUBLED compared to what we were paying in our previous new-ish 2 bed terraced house. We were shocked when we sat down after a year to find our estimates didn't add up to the reality.

Also, I've not worked due to unexpected illness for around nine months out of those three years. We've had unexpected bills coming in for repairs. Although we can 'easily' afford the mortgage, we find everything we pay every month a drain and we're living in a house that's too big for our needs (we have no kids). Once we've got the house in good decorative order, we're buying something smaller and cheaper to live in so we have more money to put towards saving for retirement and visiting relatives abroad.

My hubby hit the bail on the head the other night when he said he feels like all he does is work to pay for the house. We've gone from comfortable to tight - and on more money than you have.

Be very careful.

As much as you like this house and want it, let it go for now and keep on looking.

pickledpink

He could always take in a lodger - even 2 lodgers. That would bring in an extra £400/£800? a month.

In fact, the lodger/lodgers would be paying his mortgage for him!:money:

mr.broderick

PasturesNew wrote: »

I've rented for 6 months.

In that time any house I would have bought 6 months ago has now come down £10,000.

If I were buying that would be £2,100 rent -v- £10,000 saving (compounded at the rate of interest on a mortgage).

I expect to repeat this "saving" in the next 6 months.

It depends where/when/for how much you're doing it. And for what reasons.

Utter tosh, i just love posting controversial statements on here, it brings the desperate wood to the surface. Renting is dead money there i've said it again and it most certainly is.

pickledpink

I absolutely agree - paying rent is dead money. That's why so many of these renters on this forum are hoping and praying that property will drop - just so they can buy a place for themselves!!:D

If they really thought property was a bad investment they wouldn't be looking at this forum - let alone contributing to it!

:rotfl: :rotfl: :rotfl:

Kez100

pickledpink wrote: »

I absolutely agree - paying rent is dead money. That's why so many of these renters on this forum are hoping and praying that property will drop - just so they can buy a place for themselves!!:D

If they really thought property was a bad investment they wouldn't be looking at this forum - let alone contributing to it!

:rotfl: :rotfl: :rotfl:

????????????????? Can you not read? Its called House buying and Renting?????????????????

PasturesNew

pickledpink wrote: »

I absolutely agree - paying rent is dead money. That's why so many of these renters on this forum are hoping and praying that property will drop - just so they can buy a place for themselves!!:D

If they really thought property was a bad investment they wouldn't be looking at this forum - let alone contributing to it!

:rotfl: :rotfl: :rotfl:

I am here for the entertainment value I gain from those who think property only ever goes up.

It's cheaper than going down the pub and every day I learn new things, new angles.

It's an all round education in economics and finance reading what's posted here.

pickledpink wrote: »

...hoping and praying that property will drop - just so they can buy a place for themselves!!

And I can, cash. I choose not to. And probably won't for 3-4 years still.

Savings rising. Prices falling.
Mad to buy.

Lavendyr

pickledpink wrote: »

I absolutely agree - paying rent is dead money. That's why so many of these renters on this forum are hoping and praying that property will drop - just so they can buy a place for themselves!!:D

I don't think that was quite smug enough - can you try a bit harder please? :rolleyes::rotfl:

pickledpink wrote: »

f they really thought property was a bad investment they wouldn't be looking at this forum - let alone contributing to it!

As already pointed out, last time I looked this forum was called "House Buying Renting and Selling.

I don't mind admitting that I would like to buy a house at some point, when house prices come down, and when I have more of a deposit saved up, and when I am more settled in a location that I know I'm going to stay in for the long term. Until then, I'm more than happy with the flexibility - and the cheapness - of renting.

Kez100

Oddly, sometimes I am glad I experienced negative equity. At least now I am sat on a fortune in equity, my earlier lesson ensures I remain firmly rooted in the real world and not in that warm and brown place many others seem to now reside.

nelly_2

poppyolivia wrote: »

Things happen eh? What a scarey world we live in if we are scared to get a home with someone on the fear they might fall pregnant, split up or get divorced. Just the way the world is I suppose!:rolleyes:

Did you even read what I was replying too?

They said - its a big house blah blah blah and thy may never need to sell blah blah blah and I pointed out 'divorce' and that they well may need to sell

40% of marriges end in divorce

So next time you decide to have a pop at what Im saying look at the bigger picture like I did rather than a blinkered linear view on things

pickledpink

Nelly,

If everyone had your philosophy they'd never do anything! Yes, marriages do break up, but if we all thought as negatively as you do we'd never bother to get married in the first place!! Besides, failed marriages affect EVERYONE - mortgage or no mortgage.

Even if this couple were to split up, it wouldn't have any bearing on their mortgage! They'd simply sell the property and divide the equity. Who knows, in 10 years time they may make a small fortune each!:p

They could even rent the whole place out and go their separate ways - keeping the property as a nice nest egg................