MORTGAGES

[div0]

Because of this, and you don't usually say 100k mortgage + your deposit. A mortgage you usually say 100k of which you'll put x down.

I must have misread that. In the OP (as I quoted) it looks like he's asking about a mortgage (borrowing) £100k. But the post you quoted seems to indicate a total value of £100k, with a deposit of £30k - so only borrowing £70k.

This is why I usually try and answer as I did, rather than just linking to calculators, as some people get confused about what numbers to enter into the calculator.

If he is only borrowing 70k, then (again assuming 25 years):

Assuming 2.5% interest; you'd pay back roughly £315 per month and £95k total.

Assuming 3% interest; you'd pay back roughly £330 per month and £100k total.

Assuming 5% interest; you'd pay back roughly £410 per month and £125k total.

 

[Orch]

as some people get confused about what numbers to enter into the calculator.

If people can't even put the right numbers into the calculator, they definitely need to go and see an adviser.

 

[div0]

If people can't even put the right numbers into the calculator, they definitely need to go and see an adviser.

Haha, or just have some of the basics made clear from the help here.

OP certainly at some point in this thread seems to have mixed up 'mortgage' (amount borrowed) with the value of the property he's looking at.

I was sort of assuming that the OP was just at the very early stage of working out if they had even a remote chance of being able to afford repayments.

He says that he's looking at apartments (worth £100k?) which are 4 to 5 times his salary, so I'm assuming he's on just over £20k. Which means he should take home about £1400 / month. So he 'should' be able to afford the sort of mortgages he's talking about - in which case maybe the next stage is to now see a mortgage advisor!

 

[fastwunz]

So you're looking to borrow £70k then?

On those terms HSBC will provide a mortgage for £70k (LTV of 70%) over 25 years for £303 per month. With an interest rate of 2.19% fixed for 2 years.

You also need to factor in any Mortgages fees; some deals have booking or arrangement fees to be paid upfront.


I live in Wirehill

Stuff like this make me desperate to move out if London. I pay £1200 a month in RENT for a 1 bed flat with no outside space!!

 

[yak.h'cir]

Stuff like this make me desperate to move out if London. I pay £1200 a month in RENT for a 1 bed flat with no outside space!!

Ouch! I'm currently renting a very nice 3 bedroom house (although one of the bedrooms is tiny) for £500 a month! That is Sheffield though so that's obviously why there's a difference!

 

[Mr. Pickle]

Haha, or just have some of the basics made clear from the help here.

OP certainly at some point in this thread seems to have mixed up 'mortgage' (amount borrowed) with the value of the property he's looking at.

I was sort of assuming that the OP was just at the very early stage of working out if they had even a remote chance of being able to afford repayments.

He says that he's looking at apartments (worth £100k?) which are 4 to 5 times his salary, so I'm assuming he's on just over £20k. Which means he should take home about £1400 / month. So he 'should' be able to afford the sort of mortgages he's talking about - in which case maybe the next stage is to now see a mortgage advisor!

I take home about 20k after tax

 

[div0]

I take home about 20k after tax

It's interesting that you originally said:

I remember back in the day a house 3x your salary was considered normal or something, now Im looking at 60m2 apartments for 4 or 5 times my salary. What went wrong?

If you take home 20k (so ~£25k gross) and you're looking to borrow £70k, then your mortgage will be less than 3x your salary! Which is what was typical 'back in the day'!

You've got a good sized deposit and you're not looking to borrow a huge amount, so I think you're in a very good position.

Good luck.

 

[Mr. Pickle]

Yes but Im only buying a small 60m2 (maximum) flat, not a house.

 

[div0]

I don't think there was ever a time when it was normal for a first time buyer to walk straight into a 3 or 4 bed house!

It can be done, but it's definitely not the norm and never was.

Most people start at the bottom, which is usually a small 1-bed flat (especially in a city) and then slowly 'climb the ladder'.

You don't really seem to be in a bad situation to be honest.

I've only just bought my first place and I'm in my 30's with a decent job and had a similar deposit to you. Prices here were a lot more than you're looking at, even for a basic 1-bed flat.

You should see the size of the flats my folks first bought here 35-40 years ago - they certainly weren't houses!

 

[pitchfork]

Stuff like this make me desperate to move out if London. I pay £1200 a month in RENT for a 1 bed flat with no outside space!!

Good gravy, that would rent you a sizable 4-5 bed house in a nice area with a big garden round here.

Never understood the london thing, unless you're on 6 even 7 figures you can't get a decent property out there it seems.

 

[delta0]

London lacks space and has high average earnings per household. With limited supply and high demand it fuels the prices. Having said that the price is no higher a salary multiple than anywhere else in the country. You do get a lot more for your money outside but the value won't go up as quick. London is a good experience and has to be done if anyone gets an opportunity. It is quite common for young couples to buy a place and this forms the payment for the next home later when they move out of London.

 

[The_Abyss]

I don't think there was ever a time when it was normal for a first time buyer to walk straight into a 3 or 4 bed house!

It can be done, but it's definitely not the norm and never was.

Most people start at the bottom, which is usually a small 1-bed flat (especially in a city) and then slowly 'climb the ladder'.

You don't really seem to be in a bad situation to be honest.

I've only just bought my first place and I'm in my 30's with a decent job and had a similar deposit to you. Prices here were a lot more than you're looking at, even for a basic 1-bed flat.

You should see the size of the flats my folks first bought here 35-40 years ago - they certainly weren't houses!

Expectations in society are changing, not necessarily for the better. I'll be 41 next month, and I'm on my 6th house. The first house I bought (jointly) was a 2 bed semi, repossession. Structurally sound, cosmetically it was a **** hole in an average area.

Fewer people seem prepared to take on anything less than the initial 'dream' property, but those properties are largely unaffordable. Having the aspiration to move to an ideal home is excellent and necessary - expecting it for a first home - very much like a first car - is not the norm.

That's a great shame, as first time buyers buying **** properties or properties in **** areas very much used to play a part in the transformation of the local community. Ignoring these opportunities in favour of the latest new build estate just widen the divide and help create unrealistic expectations.

 

[ci_newman]

Expectations in society are changing, not necessarily for the better. I'll be 41 next month, and I'm on my 6th house. The first house I bought (jointly) was a 2 bed semi, repossession. Structurally sound, cosmetically it was a **** hole in an average area.

Fewer people seem prepared to take on anything less than the initial 'dream' property, but those properties are largely unaffordable. Having the aspiration to move to an ideal home is excellent and necessary - expecting it for a first home - very much like a first car - is not the norm.

That's a great shame, as first time buyers buying **** properties or properties in **** areas very much used to play a part in the transformation of the local community. Ignoring these opportunities in favour of the latest new build estate just widen the divide and help create unrealistic expectations.

The difficulty is, most first time buyers are mortgaged up to the eyeballs and simply can't afford the cost of home improvements.

In my case, it was easier (and cheaper in the long term, LTV etc) to take out a mortgage of £190k than it was to take a mortgage of £160k and try and find £30k to modernise a property.

 

[Trifid]

Use this: http://forums.moneysavingexpert.com/showthread.php?t=1157173&page=1
And this: http://www.moneysupermarket.com/mortgages/search/results/?goal=MOR_MOVER


Remember interest rates are at an all time low.



I broke my rule of getting somewhere that was perfect inside but I traded it off for the place not being a flat, it a nice area with no ground rent to pay and to be freehold.

 

[div0]

Expectations in society are changing, not necessarily for the better. I'll be 41 next month, and I'm on my 6th house. The first house I bought (jointly) was a 2 bed semi, repossession. Structurally sound, cosmetically it was a **** hole in an average area.

Fewer people seem prepared to take on anything less than the initial 'dream' property, but those properties are largely unaffordable.

I was lucky in some ways because when I was first looking at buying a place (after uni), it was the peak of the boom, which meant that buying anything myself was just unaffordable, even a tiny 1-bed in an average area. Properties here would often go for 30%+ over the (already inflated) asking price, with potential buyers driving prices up in a bidding frenzy! I was lucky because my folks already had a flat, which I could rent on the cheap and save up a decent deposit. I ended up staying in that flat longer than any other place I've ever lived.

Last year we were able to buy our 'dream' first house. By no means a dream house in the sense that it's still only a 2 bed flat, but it's in a lovely area with our own main door and a much bigger garden than we ever expected in the city. For a first home, it is everything we wanted.

But I do think you're right that people's expectations have changed - you do see a lot of people complaining about not being able to afford to buy, but then expecting to buy a detached house in a desirable area as their first home.

 

[PiKe]

I've saved for 10 years and I've just managed to buy a 2 bed terraced house at 29, which I'm told is quite impressive.

49% LTV and £361 a month (5YR Fixed) for the next 26 years...

 

[pitchfork]

London lacks space and has high average earnings per household. With limited supply and high demand it fuels the prices. Having said that the price is no higher a salary multiple than anywhere else in the country. You do get a lot more for your money outside but the value won't go up as quick. London is a good experience and has to be done if anyone gets an opportunity. It is quite common for young couples to buy a place and this forms the payment for the next home later when they move out of London.

Why would you want to live amongst all the crime and pollution and huge wealth divides in a tiny place that costs most of your salary and be forced on to public transport because the roads are too busy to run a car is my point?

I know guys living in london paying thousands on a 1 bed apartment and it still takes them ages to get to work. That's no way to live.

 

[ci_newman]

Why would you want to live amongst all the crime and pollution and huge wealth divides in a tiny place that costs most of your salary and be forced on to public transport because the roads are too busy to run a car is my point?

I know guys living in london paying thousands on a 1 bed apartment and it still takes them ages to get to work. That's no way to live.

Atmosphere init..

 

[delta0]

Why would you want to live amongst all the crime and pollution and huge wealth divides in a tiny place that costs most of your salary and be forced on to public transport because the roads are too busy to run a car is my point?

I know guys living in london paying thousands on a 1 bed apartment and it still takes them ages to get to work. That's no way to live.

Pollution is obviously hand in hand with any city. Crime is isolated. For most people it doesn't cost most their salary because they get paid a lot more. Unless you are trying to drive through London I barely notice traffic. Bristol and other cities are far far worse. If it is taking ages to get to work you are either commuting across from the other side of London, live far from a station or don't live in London. It is odd looking from the outside in and I'm used to Yorkshire countryside, but now I've been there for a few years it is a really overwhelming and addictive place to live. There is so much to do and see and it is very convenient. If you are buying a place it is even better as you can make a big return on the investment.

 

[AndrewNR]

A house for 100k and a deposit of 30k?

A mortgage for 70k over 25 years will be a fairly low monthly figure. I'd look to spread it over 20 years or less, reduce the extortionate amount of interest you have to pay in the 'early years'.