House prices rose 7.3% this year, average now almost £250k

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FoxEye said:
You still need workers to work in Cornwall. They can't all commute from Newcastle or Slough or something.

And the jobs in Cornwall that serve the tourists when they come aren't well paid.

Council housing and higher minimum wage would be my idea. I just dont think it is going to be easy to dent the housing market without something drastic like banning the rental of short term lets.

Which is what they have done in Mallorca. But it plays in time the big hotels hands then.

With housing that's unaffordable for vast swathes of workers in Cornwall, your solution is for them all to move away?

There would be nobody left to serve those tourists :p Or care for the elderly (another low paid but essential role).

It's just not a solution at all.
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dLockers said:
If you are truly from Hertfordshire, this should be very unsurprising. That gets you a 600sq/ft 2 bed which gives you just about a five year timeline if you plan to have kids. This is assuming you haven't wasted your first time buyer stamp duty allowance on a 250k flat just to "get on the ladder".
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I am, there is property costing substantially less for a first time buyer, at least in this area (Ware/Hertford) but your point is sort of correct. You wont get a "nice" family home.

We got lucky I guess jumping on the ladder 15 or so years ago. Whenever I look at house prices I am constantly going "thats never worth that", "no way I would pay that".....then they sell straight away.
 
Semple said:
Disregarding his need for a 500k house (which presumably would be a fair size) for an individual, at close to 100k would give you a net annual salary of ~55kish. If you're splurging 1.5k-2k a month on rent just to live in a decent area, then you've got to accept it'll take significantly longer.

I perfectly accept stretching yourself financially to get a property for long-term plan, especially whilst interest rates are very low, but compromises have to be made somewhere. Especially if your target is moving further away with each year of saving.
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If its anything like where I live, it will be 600 odd square feet, with 1.5 beds (2 if you are lucky), no parking and no scope to extend with work required.

Agreed on the final point. This is the gamble that is part and parcel of living in the south, and presumably key parts of the North.

Luckily I had a LISA which meant my negotiating strategy was made for me.
 
chroniclard said:
I am, there is property costing substantially less for a first time buyer, at least in this area (Ware/Hertford) but your point is sort of correct. You wont get a "nice" family home.

We got lucky I guess jumping on the ladder 15 or so years ago. Whenever I look at house prices I am constantly going "thats never worth that", "no way I would pay that".....then they sell straight away.
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Well Hertford for sure you are not getting a lot for your money unless you want to own a car and live a bit further out. Then if you wrap that 2-car family business case up, you may as well invest into a more central house that is walkable to decent amenities and has good public transport. Especially when the next family to come along will do the same thing and you'll still make 50k in 2/3 years on the resale.
 
Psycho Sonny said:
What about ones that aren't near you or that aren't beach front properties?

Those start much lower right?
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I actually had a look at Cornwall after you posted about the sub 60k, and yes there's loads of places for around that amount. Surprised, I assumed they would be a lot more expensive. I do wonder if sometimes people have unrealistic expectations for a first house., with no compromises at all.
 
HACO said:
That is why I rent. I can't afford not to. But every payment feels like I'm slaving away for someone else's benefits, and that's exactly what it is.

At the beginning of 2020 I was 1 year away from being able to buy the kind of place I wanted (£500k house with £50k deposit at about 2% interest rate).

Right now I have my £50k deposit, but those £500k places are now closer to £600k, and 90% LTV mortgages are now at 3.6% interest, meaning I can't afford them anymore. I need to bring that deposit up to £120k to bring monthly payments down to a level I can afford (£480k @ 2% interest), so I need to rent for another 2-3 years. But maybe by then the prices would be £800k and I may need a £200k deposit. This is how people get priced out of the market indefinitely.

My BTL landlord however, is popping up champaign. His properties are worth a lot more, and people are forced to rent for longer before they can buy their own place.
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You know paying mortgage interest is also slaving away for someone else’s benefit ?

If you accepted a compromise and bought somewhere smaller for a few years you’d now be in the house you want. A £500k first house is rather ambitious ! The phrase ‘getting on the ladder’ wasn’t invented for no reason
 
Simon said:
You know paying mortgage interest is also slaving away for someone else’s benefit ?

If you accepted a compromise and bought somewhere smaller for a few years you’d now be in the house you want. A £500k first house is rather ambitious ! The phrase ‘getting on the ladder’ wasn’t invented for no reason
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It is ambitious but fairly normal depending on where the poster is from.

A starter home now attracts stamp duty in these areas so holding off in the short-term can have a significant benefit in the long-term especially if your values are living in somewhere you like instead of "getting on the ladder" for the sake of it.

As stated a few times though, this is the gamble first time buyers make. Losing that first time buyer privilege is very impactful!
 
Indeed it’s a bit of a gamble. But there is no stamp duty at the moment so don’t think that’s too much of an issue.

A £500k first house with a 10% deposit isn’t normal with anyone I know and I live in the south east.
 
dLockers said:
Losing that first time buyer privilege is very impactful!
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Not really. The maximum discount is £7500.
When he's looking at houses for £500k which have gone up £100k in a year, holding out longer to keep first-time buyer status is a bad idea.
 
touch said:
Not really. The maximum discount is £7500.
When he's looking at houses for £500k which have gone up £100k in a year, holding out longer to keep first-time buyer status is a bad idea.
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its like earning less on purpose to pay less tax
 
Doing a bit of maths on his numbers: if the house prices continue to rise at the rate he stated, he only needs to delay buying a house by 27 days for the price increase to negate any stamp duty savings.
 
Simon said:
Indeed it’s a bit of a gamble. But there is no stamp duty at the moment so don’t think that’s too much of an issue.

it’s not normal with anyone I know and I live in the south east.
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It expires March 31st.

How many first time buyers do you know? Not many I bet. Someone is buying these houses, myself and the OP included. The fact that SDLT is even there for properties in this price range proves someone is claiming it.

Rather than trust our anecdotal "source: me" discussion though, it'd be good to see some data. Can't find any quickly so gave up.

touch said:
Not really. The maximum discount is £7500.
When he's looking at houses for £500k which have gone up £100k in a year, holding out longer to keep first-time buyer status is a bad idea.
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Saving an additional £7500 on top of £50k already saved up isn't as easy as you seem to think.

touch said:
Doing a bit of maths on his numbers: if the house prices continue to rise at the rate he stated, he only needs to delay buying a house by 27 days for the price increase to negate any stamp duty savings.
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If only house prices followed a linear average calc :)
 
dLockers said:
It expires March 31st.

How many first time buyers do you know? Not many I bet. Someone is buying these houses, myself and the OP included. The fact that SDLT is even there for properties in this price range proves someone is claiming it.

Rather than trust our anecdotal "source: me" discussion though, it'd be good to see some data. Can't find any quickly so gave up.

Saving an additional £7500 on top of £50k already saved up isn't as easy as you seem to think.

If only house prices followed a linear average calc :)
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Ah the good old internet. You know about me ?

I know loads thanks. I’ve played in football teams/clubs for 10yrs in the area and work at a company with graduates who are then buying in the area
 
Simon said:
With 10% deposit I would imagine there isn’t much difference
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It's not even close. You'll save significantly more with a mortgage.

*I'm talking in the context of buying a house he can afford now with the view of moving to the 600K house he wants in a few years. So taking into account how much has been paid off the capital, not just the spare money going into the savings account each month.
 
£450k loan is £2200 a month mortgage.

what’s the rent on a £500k house in your area ?

You won’t be saving significantly more
 
touch said:
It's not even close. You'll save significantly more with a mortgage.

*I'm talking in the context of buying a house he can afford now with the view of moving to the 600K house he wants in a few years. So taking into account how much has been paid off the capital, not just the spare money going into the savings account each month.
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You may be right as long as the cheaper house costs nothing to buy and doesn't put you in a situation where you are now incurring other expense. My £1400 was "high" but my transport was £0 as I could walk everywhere. I now pay £1800 to 'get on the ladder' in a less desirable area and my transport is (pre-Covid) £300+ and I need two cars.

That makes the small £7.5k becomes £10k straight away (assuming £2.5k for surveys, solicitor etc. on this other house), then all of those lifestyle implications.

It is a very tricky, often emotional situation as well. Lots of things to consider but hopefully you see "our" point of view.
 
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