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

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dLockers said:
Wrong, it is a huge difference. It is £7.5k which if you are renting could be another 12 months of saving.
12 months of saving on top of the X number of years already spent saving, you are in OPs situation and priced out of where you want to live.
Stop undermining peoples hard work because you haven't experienced it.
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But you wont be renting. That's the point.
I'm not saying that it's easy to save up when you're renting. I'm saying that it's easier to save when you're not renting and paying your own mortgage instead.
Considering price rises, you're likely to be better off in the long run to pay more stamp duty but buy the house you want sooner because you've been able to save more by buying a cheaper house first and not having to pay rent.
 
HACO said:
I haven't had that income since the day I was born, lol.
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I'm very interested to hear your numbers then.

500k property, 50k deposit = 450k mortgage.

Most lenders are offering in the region of 4.25-4.75x annual salary - so your earnings would need to be in the range of 95k-106k.

I didn't necessarily mean you were on 100k, but even if you and your wife/partner were on 50k each, which lead to my follow on questions of how can you both be on that much but have only saved up a 50k deposit.
 
Vanilla said:
Rental contracts are also typically one year long with the option to roll by month or extend by another year. You can negotiate many years. Just like a job contract - you can negotiate and get what you want for your needs. I have signed a contract for one year and then, realising I love the place, then went on to sign for two years in the past. You can't be evicted during this time.

You've never had any experience of renting right?

Edit: Also, wouldn't 10 year leases just make it harder for those BTL landlords to sell the properties? Seems you want everything even if it would hinder the things you want earlier in the thread.
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I've read the regulations. Have you?

There are various "sections" in the law that allow landlords to repossess a rented house under various circumstances, in as little as two weeks, if they want to be bloody minded.

e: When I have more time I'll find the classes I'm referring to but
a) Two weeks notice if the landlord claims they need to resume occupying the property themselves
b) If the landlord "intends" to put the property on the market

Etc, etc.

There are lots of clauses revolving around tenant behaviour too, such as "excessive wear and tear" which can void any guaranteed lease term.

Loads of such claueses.

Basically if a landlord in this country really puts their mind to it, they can have the tenant out in a matter of weeks.

Of course the tenant might be willing to force the landlord to go through the courts and evict, but many tenants will simply pack up and move on quietly when told to.
 
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touch said:
But you wont be renting. That's the point.
I'm not saying that it's easy to save up when you're renting. I'm saying that it's easier to save when you're not renting and paying your own mortgage instead.
Considering price rises, you're likely to be better off in the long run to pay more stamp duty but buy the house you want sooner because you've been able to save more.
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You are undoubtedly right but as always "it depends".

If cheaper house ends up costing £5k in white goods, sofas, general repairs and maintenance - and the mortgage is higher than your rent - it is more of a mid-to-long-term game. It is the opportunity cost of doing it versus the immediately quantifiable SDLT saving.
 
Surveyor said:
£800/month equates to a 25 year repayment mortgage at 0.7% interest.

What deal are you on?
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I believe its 1.6 over 30 years. Not 100 percent sure

Round here for modest places the rental:mortgage heavily leans towards. Mortgage being cheaper.
Not sure how much this varies nationwide.

In my example.

Rent for 1 bedroom flat (not nice one either, electric heating For one!) was just under of 500ppm

Not few miles away my mortgage costs 800 (I believe 300 is effectively interest) for 220k in a 3 bed detached.

Let's say prices stay same. And the 500 of repayment a month is 500 if you sold up.

If you did this enough years to mitigate land tax (stamp duty)...

300 interest : 500 rent

So you're in profit by 200ppm


Trying to make a point Fail...
Now I write that, and see my land tax was 3k it actually doesn't seem quite as good! :D

Without price rises it is a long time to break even!
 
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dLockers said:
Wrong, it is a huge difference. It is £7.5k which if you are renting could be another 12 months of saving.

12 months of saving on top of the X number of years already spent saving, you are in OPs situation and priced out of where you want to live.

Stop undermining peoples hard work because you haven't experienced it.
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Did you actually mean to quote me there?
 
Semple said:
Did you actually mean to quote me there?
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Yes - you said £5k was nothing to someone who was looking at 500k houses. I can speak from experience and say £5k hurts me just as much as it hurts everyone else - time to gather it together or opportunity cost of spending it elsewhere.
 
413x said:
I believe its 1.6 over 30 years. Not 100 percent sure

Round here for modest places the rental:mortgage heavily leans towards. Mortgage being cheaper.
Not sure how much this varies nationwide.

In my example.

Rent for 1 bedroom flat (not nice one either, electric heating For one!) was just under of 500ppm

Not few miles away my mortgage costs 800 (I believe 300 is effectively interest) for 220k in a 3 bed detached.

Let's say prices stay same. And the 500 of repayment a month is 500 if you sold up.

If you did this enough years to mitigate land tax (stamp duty)...

300 interest : 500 rent

So you're in profit by 200ppm


Trying to make a point Fail...
Now I write that, and see my land tax was 3k it actually doesn't seem quite as good! :D

Without price rises it is a long time to break even!
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Exactly this... without price rises it is a long time to break even. And the opportunity cost of losing FTB SDLT allowance, and the property of your slightly-adjusted-dreams.

It isn't black and white as much as OCUK'ers like it to be. Luckily we then have the old boys coming up the rear with their anecdotal musings who are fully disconnected from reality.
 
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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Ahh the truth is finally revealed.

This is nothing to do with future generations. It's all about you.

You were talking about your kids being able to afford a place and the reality is you don't own your own place.

£500k for a first house. Just lol.

Uther said:
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.
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There's actually decent ones that start at £65k and I've seen plenty under £180k too he quoted.

437 properties below £150k. And I excluded new builds, retirement homes, scheme association, etc.

He is actively choosing to live at home.
 
dLockers said:
Exactly this... without price rises it is a long time to break even. And the opportunity cost of losing FTB SDLT allowance, and the property of your slightly-adjusted-dreams.

It isn't black and white as much as OCUK'ers like it to be. Luckily we then have the old boys coming up the rear with their anecdotal musings who are fully disconnected from reality.
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To be honest I knew it was a while, but didn't realise quite how long until just now. But yeah with all fees for buying etc it really isn't as rosy as it seems.

Even worse if you can use the money you save not buying to invest etc.

Obviously you could get a cheaper place. I mean cost to rent what I'm living in now would be ridiculous.
If I had bought the flat I lived in the difference would be bigger


Like any investment its a risk. I mean house prices could easily fall. Or increase at rate below inflation. And its not easy to sell a home like shares or BTC.

Just some musings I guess
 
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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Ahh the truth is finally revealed.

This is nothing to do with future generations. It's all about you.

You were talking about your kids being able to afford a place and the reality is you don't own your own place.

£500k for a first house. Just lol.
Semple said:
I'm very interested to hear your numbers then.

500k property, 50k deposit = 450k mortgage.

Most lenders are offering in the region of 4.25-4.75x annual salary - so your earnings would need to be in the range of 95k-106k.

I didn't necessarily mean you were on 100k, but even if you and your wife/partner were on 50k each, which lead to my follow on questions of how can you both be on that much but have only saved up a 50k deposit.
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They both have the latest iPhone every 6 months.

They both lease brand new Audi's every 2 years.

They eat out every week.

The list goes on and on.

He's not willing to sacrifice anything including dropping his budget to £400k it must be a £600k home
 
Vanilla said:
Can you share them?
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OK there's a couple in Section 8 just for starters.

14 days notice if: the landlord wants to carry out some refurb work;
the landlord wants (or claims to want) to occupy the house (for any length of time, before renting it out again...)

Then there's Section 21 which allows eviction in 6 months for no specified reason (ie the landlord doesn't need a reason).

Section 8 also provides grounds for termination if the landlord wants to claim that the tenant is causing unnecessary wear and tear, or being "antisocial" and a whole number of other things.

A landlord has a *lot* of tools at his disposal to get rid of tenants. Since just wanting to make some alterations is enough under Section 8 to get the tenant out in two weeks, it's not exactly hard.

As for personal experience, I do know people who have been on the receiving end of a Section 8 for Refurbishment. The people in question found the place back on the rental market two weeks later for double the rental cost. They'd done some minor work but clearly the motivation was simply to put the rent up well above the rate of inflation.

It happens. I'm sure you know it happens, in all honesty.
 
Psycho Sonny said:
Ahh the truth is finally revealed.

This is nothing to do with future generations. It's all about you.

You were talking about your kids being able to afford a place and the reality is you don't own your own place.

£500k for a first house. Just lol.


They both have the latest iPhone every 6 months.

They both lease brand new Audi's every 2 years.

They eat out every week.

The list goes on and on.

He's not willing to sacrifice anything including dropping his budget to £400k it must be a £600k home
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Yeah basically this was my problem. I wanted the £500k house and the new car, expensive watch, expensive shoes and clothes, AND the £500k house. Luckily my salary kept pace with my lifestyle, but I really could have done a lot more and got into the £600k house OP mentioned. I just decided to sacrifice and go for a £450k first house.
 
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