Congrats dude!said yes to a new build place, its part buy part rent which isnt to everyone's taste but literally the only way i can get back on the ladder as a solo buyer.
2 bed 1 bath place is one of the nicest area in my town/city. nice and quiet and out the way. on a small development. has solar panels which is a nice addition and network points already installed running to the cupboard under the stairs.
just waiting for the paperwork to go through but all should be good.
The nervous wait to exchange....
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Soldato
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It's super crap for first time buyers right now, but if you already have something then the market growth over last few years is a boon not a detriment, we gained 80k on our 3 bed 1 bath house (late 50's council house in West London) purchased in 2019, which gave us enough to move to a 6 bed, 5 bath monster of a house on the south coast and we've still got 25% equity (moved in last week)
In 6-12 months time first time buyers could find themselves in a better position, as more fixed rate mortgages will have expired by then and anyone on variable rate mortgages could be under more pressure as well - if there's another rate rise (likely IMO) then more property should hit the market which should reduce the price a bit - though to get a good mortgage rate I expect we'll see a rise in first time buyers opting for lifetime mortgage deals, or 10 year fixed deals.
I think most property deals completing in the last couple of months through to the next 3 months would have had interest rates set in the buyers AIP pre base rate rise, so a slowdown should happen soonish I would expect as those deals expire and new mortgage applications will all typically be looking at a higher rate.
It'll take at least 12 months minimum before more stuff starts arriving at auction that's been repossessed by the banks if the cost of living keeps going up - maybe longer, so if you've got cash to hand in any quantity then there's going to be some good deals to be had - just like 2008 IMO.
thanks,
i got the short end of the stick when splitting with the ex so was left with a tiny fraction of the equity in our joint property. Renting for the past 2 years @ 700pcm and trying to save as much as i possibly can.
have been waiting for the right property to come up and the 2 developments i was looking at aren't releasing any 2 bed places until early 2024 and early 2025. i didnt even know about this development as i didnt ever imagine being able to afford it. i guess luck was just on my side this time.
Soldato
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I am getting the sense that we are not far away from a very major slowdown in the housing market. It will be worse than 2008. Having an offer way over the asking being unsuccessful is indicative of this final phase.
Since you asked, the point where you draw the line is where future payments risk being unaffordable if interest rate rises pick up pace, which there is a strong possibility of.
When the housing market stalls, it can very quickly turn from desperate buyers to desperate sellers, so whilst it's frustrating not getting the property, there is a high probability that you will have much better buying conditions in the not too distant future.
Soldato
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We have basically decided to stop looking and come back best year. Too much uncertainty with rising energy costs incoming etc and like people say here, we just aren't willing risking paying over the asking price on some of these properties we have been looking at.
It's still sheer madness with even poor area properties just going for way too much at the minute, basically every property turns into a bidding war.
It's a shame because our current flat we got a cash buyer ready to go, but seems unfortunate we will have to finally tell them they may have to look elsewhere, unless they are willing to wait it out themselves for at least a year maybe.
We are both a bit frustrated, we have both got a few pay rises in recent years since having the flat but it's like we are no further forward from 5yr ago because of the madness that is the housing market now, rising costs etc.
I get too annoyed with the estate agents at the min, putting property up at a price of offers over, then doing this whole best and final bid tactic forcing all bidders into throwing in excessive amounts that are stretching their finances potentially.
Seems like a lot of people are happy with that, or we are in competition with people that just have a lot more money than us
The final roll of the dice was last week viewing a house in a pretty poor area realistically, and it was still a case of going 20-30% over.... no chance.
It's still sheer madness with even poor area properties just going for way too much at the minute, basically every property turns into a bidding war.
It's a shame because our current flat we got a cash buyer ready to go, but seems unfortunate we will have to finally tell them they may have to look elsewhere, unless they are willing to wait it out themselves for at least a year maybe.
We are both a bit frustrated, we have both got a few pay rises in recent years since having the flat but it's like we are no further forward from 5yr ago because of the madness that is the housing market now, rising costs etc.
I get too annoyed with the estate agents at the min, putting property up at a price of offers over, then doing this whole best and final bid tactic forcing all bidders into throwing in excessive amounts that are stretching their finances potentially.
Seems like a lot of people are happy with that, or we are in competition with people that just have a lot more money than us
The final roll of the dice was last week viewing a house in a pretty poor area realistically, and it was still a case of going 20-30% over.... no chance.
Soldato
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I can totally understand the frustration. A mortgage is the only type of debt I would ever consider, but it's still a debt, and whilst getting a mortgage should be done as soon as realistically possible, it is the realistic part that is important, in terms of can you really afford it if conditions turn adverse in future years. The housing market has been massively inflated, and at some point it will become unsustainable. It has been crazy for so long, that you always think how long can the banks keep it going for. The critical thing is affordability for you. Other people who over stretch will not survive a recession. I don't think we are that far way from a major stalling in the property market. This video is for the US market, but what happens in the US soon comes to the UK:
Like everyone else, I'm after a few thoughts re cost of living, house prices, and inflation. As I mentioned a few pages back, I've had a great offer to sell my flat, and have had an offer accepted on a nicer place in a nicer area. I have about 3.5 years remaining on my current mortgage, and will be borrowing a further £90k to move to the new place (presuming the offer on my place doesn't disappear / drop significantly following a survey). At current interest rates, monthly repayments will be comfortable, and I'll probably be able to pay around £750 extra into the mortgage each month. I've asked what would happen if, after my fixed term ends, interest rates are at 10%, and I'd still be able to afford the mortgage and bills on my current salary, although it wouldn't be much fun. Obviously I'm hopeful that my salary will increase in that period as well.
That said, the purchase will more or less entirely clear out my savings, and I'll be borrowing to the limit of what I can get at my current salary.
Basically, therefore, unless things go absolutely mad I feel like I should be OK, but there's a part of me that feels as though stretching my finances so far in the immediate term is a bad idea. I'm pretty unhappy in my current location, so am very keen to move, but don't know whether I'm overdoing it financially. What do you guys reckon? Any words of reassurance or concern? Thanks!
That said, the purchase will more or less entirely clear out my savings, and I'll be borrowing to the limit of what I can get at my current salary.
Basically, therefore, unless things go absolutely mad I feel like I should be OK, but there's a part of me that feels as though stretching my finances so far in the immediate term is a bad idea. I'm pretty unhappy in my current location, so am very keen to move, but don't know whether I'm overdoing it financially. What do you guys reckon? Any words of reassurance or concern? Thanks!
Soldato
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I think stretching is a bad idea because the cost of living will probably continue to rise and interest rates will continue to rise in response. But I also think it's not worth staying somewhere that makes you miserable. Ultimately it comes down to whether you can cover increased costs by getting promoted or living like a student.
Soldato
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I'm sure many don't. I hadn't considered it until my manager left and I couldn't face working for their replacement.Whoops why didn’t we all think of that
Yeah that's our thinking.
I already own my own place and we were looking to buy jointly. I would then sell mine after (cba renting it out too many first hand bad experiences). So on the one hand it's disappointing to miss out but like you say chances are there will be more opportunities coming. Although the type of property we want (rural, bit of land) I think will always have competition and less likely to suffer in a downturn than your everyday semi. Maybe not, who knows for sure.
I would also miss out on selling mine at a better price but I'd rather "lose" out on an extra 10% on my house worth £130k than have to pay 10% extra on a £300k house.
So much to consider and so much uncertainty...
Soldato
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It is really hard for anyone on a forum to say because we won't know all your circumstances. What seems likely to happen is that within the next year the property market will stall. So, you wouldn't want to be in somewhere that was too expensive for you and that you then needed to sell quickly. Interest rates aren't likely to go anywhere near 10% in the short to medium term. A cursory answer would be it sounds like it's going to be affordable for you, but expect a difficult housing market and cost of living increases, so you would need to be confident in affording everything for at least the next two years.
In general, because house prices are at such ridiculous levels, as soon as you can make a deal then go for it, as it will never be that affordable, but you still have to be able to live and you must avoid any potential negative situation, i.e. do not borrow if it could go really wrong, but this doesn't sound like you.
Nice one, thanks. As @throwaway4372 has said, worst comes to the worst if things hit 10% when my fixed term ends and my pay hasn't increased (which I would hope is unlikely - there are people in the same role and same level as me but at larger companies earning double my salary, albeit by working twice my hours), I should still be able to get by by living like a student.
Is it an issue for you? What concerns you about it?
The fact it might not actually be there?
Solicitors concern, preventing exchange.
I'm of the opinion (uneducated) that if it was retrospective filled, any issues should have manifested itself already?
Soldato
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If its not there, great. If it is there, doesnt mean you will have any issues with bridging.
You could be able to verify is fairly easily by ‘looking’ down the cavity in the loft.
When I say looking that could be an endoscope camera if you have one or something fairly low tech like poking a rod down or even a stone on a string and checking for resistance.
The solicitor will not prevent you from exchanging, all they’ll do is tell you what they have been told and take your direction. It’s unlikely they’ll have a strong opinion on it either way. It’s not something fundamental like missing planning permission etc.
I’d also have expected any I’ll effects of badly installed insulation to have manifested by now. That said, it’s summer and they can be easily hidden with stain blocking paint.
When I say looking that could be an endoscope camera if you have one or something fairly low tech like poking a rod down or even a stone on a string and checking for resistance.
The solicitor will not prevent you from exchanging, all they’ll do is tell you what they have been told and take your direction. It’s unlikely they’ll have a strong opinion on it either way. It’s not something fundamental like missing planning permission etc.
I’d also have expected any I’ll effects of badly installed insulation to have manifested by now. That said, it’s summer and they can be easily hidden with stain blocking paint.
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This was out approach to, we could offer more and we do have a fair amount available via the mortgage.
Not a chance I'm doing that if I think I'll be moving again in 5 years
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Ours has cavity insualtion, we had for it to be done on one of the gov grants, they came out said already done jog on.
I have no paperwork or guarantees to say it was ever done lol, house built in the 50s so muctve been done at some point.
We had some proper laughable stuff on a L2 Survey tho...
Survey advises a full video tour of the drains... as the surveyor couldn't locate the manhole covers (they're damn obvious)
Survey advises a insect/bug investigation.... as the property has roof timbers - Dont most houses have roof timbers lol