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How the heck do people my age and younger afford to buy houses?! Watch

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    (Original post by LavenderBlueSky88)
    that's still quite a lot I think my salary after tax and pension and loan is about £17k and my boyfriends is even lower than that :/*
    You'd have to be on like £12 an hour I guess, assuming you work 8 hours mon-Friday, but there's other ways to gather a deposit or it might just take you longer, like 5 years. I still think it'd be repayable, you could start interest only and eventually you can arrange to start paying for equity, hopefully by then you'd have a pay rise too! So it's possible, before osbournes changes it was easy to get a landlord mortgage and just pay interest whilst renting it out so you're paying zero and actually making profit while also paying off a house so it's a short term and long term investment
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    My friend recently bought his house. To be fair, he got a pretty good job after graduating and started with 21k salary. He saved money by renting with some friends so paid around £300 a month for rent and bills. He put around 10k into savings each year for 4-5 years got a good amount saved up and then got a 10 year mortgage to cover the rest.

    I personally plan to open help to buy isa after I move for uni and get a part time job. Start the £200 payments then and save what I can left over from rent/food/bills. Thankfully my maintenance loan should cover my rent for the whole year. By the time I finish uni, if everything goes to plan, I should have saved up quite a bit. Then I'll probably spend a few more years saving while working full time and in 5-6 years time I should probably be able to get a pretty good place on mortgage. Then it's basically like paying rent except you can do whatever you want with your property.
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    (Original post by zayn008)
    You'd have to be on like £12 an hour I guess, assuming you work 8 hours mon-Friday, but there's other ways to gather a deposit or it might just take you longer, like 5 years. I still think it'd be repayable, you could start interest only and eventually you can arrange to start paying for equity, hopefully by then you'd have a pay rise too! So it's possible, before osbournes changes it was easy to get a landlord mortgage and just pay interest whilst renting it out so you're paying zero and actually making profit while also paying off a house so it's a short term and long term investment
    Yeah I think I'm on about £12 per hour, £22k gross salary per year. Which isn't actually too bad considering I only graduated in 2014, if I'd gone straight into work at 21 like most people I'd probably be on nearer £26k. *
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    (Original post by Danny the Geezer)
    5k from a 25k wage (tax not taken into account) is a 5th of a salary-quite a lot. Whereas I could rent and not be given the millstone of a mortgage. But if you want to own a home (eventually) I guess then go for it
    £5k over a reasonable timespan of 5 years to save for a deposit is £1k a year, 1/25th of a salary - not a lot at all..
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    (Original post by Reue)
    £5k over a reasonable timespan of 5 years to save for a deposit is £1k a year, 1/25th of a salary - not a lot at all..
    Well yeah but what with inflation etc house prices go up in 5 years. 5years is a bit too long imo to save for a deposit, I mean what if you suddenly couldn't work due to ill health/redundancy etc?
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    (Original post by Danny the Geezer)
    Well yeah but what with inflation etc house prices go up in 5 years. 5years is a bit too long imo to save for a deposit,
    5 years is an entirely reasonable timespan to save for a deposit for the single biggest purchase of your life. The assumption would be that your salary will also increase during this time and so you would increase your savings rate.


    (Original post by Danny the Geezer)
    I mean what if you suddenly couldn't work due to ill health/redundancy etc?
    And what if that happened after you purchased a house?
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    (Original post by Reue)



    And what if that happened after you purchased a house?
    Well yeah, pretty much why I would be reluctant to commit to a mortgage, say you were self-employed? How would that work. The mortgage companies/banks don't accomodate for poor earnings, cos ofc you're not on a fixed income.
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    (Original post by Danny the Geezer)
    Well yeah, pretty much why I would be reluctant to commit to a mortgage, say you were self-employed? How would that work. The mortgage companies/banks don't accomodate for poor earnings, cos ofc you're not on a fixed income.
    You'd go through a broker who specialises in finding mortgages for self-employed.
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    (Original post by Reue)
    5% deposit on £200k house is only £10k. Split between 2 people is £5k each... how anyone can't afford to save that while employed is beyond me.
    In London, £200K is the deposit.
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    (Original post by Fullofsurprises)
    In London, £200K is the deposit.
    OP is not in London.
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    (Original post by Reue)
    OP is not in London.
    OK, but the thread seems to be about the subject generally and lots of areas are being discussed. I was also exaggerating for effect. :teehee: Seriously though, it's clear there's a huge difference between getting / saving to buy a place in the North or places like Scotland or Wales than there is across South East England, or the lower half of England generally. I just felt that was a point worth making. It's terribly hard for people even with good jobs to save enough to buy a place in London now unless they have substantial family financial support.
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    (Original post by Fullofsurprises)
    OK, but the thread seems to be about the subject generally and lots of areas are being discussed. I was also exaggerating for effect. :teehee: Seriously though, it's clear there's a huge difference between getting / saving to buy a place in the North or places like Scotland or Wales than there is across South East England, or the lower half of England generally. I just felt that was a point worth making. It's terribly hard for people even with good jobs to save enough to buy a place in London now unless they have substantial family financial support.
    Frankly; if you're making less than £50k in London you ought to just take a £20k pay cut and move elsewhere.

    I live in the South East, plenty of houses around here for under £200k.
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    (Original post by Reue)
    Frankly; if you're making less than £50k in London you ought to just take a £20k pay cut and move elsewhere.

    I live in the South East, plenty of houses around here for under £200k.
    Where are you in the SE out of interest? There's really nothing in London for that, well, maybe tiny flats in well-out places.
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    (Original post by Fullofsurprises)
    Where are you in the SE out of interest? There's really nothing in London for that, well, maybe tiny flats in well-out places.
    Berkshire
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    (Original post by Reue)
    Berkshire
    OK, had a look at it on Rightmove - it's definitely cheaper in places like Bracknell, Slough, etc, than it is in London.

    I would guess that property there will go up when Crossrail goes live, if not sooner. That's if the downward effects of Brexit don't cancel it out.
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    (Original post by Fullofsurprises)
    OK, had a look at it on Rightmove - it's definitely cheaper in places like Bracknell, Slough, etc, than it is in London.

    I would guess that property there will go up when Crossrail goes live, if not sooner. That's if the downward effects of Brexit don't cancel it out.
    It's cheaper anywhere other than London.

    It's already only 30 minutes to get to Paddington from Reading, I cant see crossrail having too much of an effect.

    Regardless; my point is that there are places in the South East which can be easily afforded by first time buyers.
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    (Original post by Sicudeh)
    There's this awesome invention called a mortgage
    Oooh! Never heard of it. #SarcasmSociety
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    (Original post by Reue)
    It's cheaper anywhere other than London.

    It's already only 30 minutes to get to Paddington from Reading, I cant see crossrail having too much of an effect.

    Regardless; my point is that there are places in the South East which can be easily afforded by first time buyers.
    Yes, provided they can save up the £20K deposit and the £1.4K stamp duty, plus moving costs. Not inconceivable for many, agreed, but still quite a hill to climb even for a couple with both in work at average salaries. Yes, they can reduce their lifestyles a lot to save for it, but for people with children especially that can be tough. Also the £200K places you are talking about are frequently quite small flats with 1 bedroom.

    It's also the case that large numbers of people have been casualised in the modern labour market, with fewer percentage wise having the sort of 'guaranteed' salaries that lenders look for. That makes it harder to get loans at all, even with the deposit, for large numbers. Hence the explosion in the rental sector.
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    (Original post by Fullofsurprises)
    Yes, provided they can save up the £20K deposit and the £1.4K stamp duty, plus moving costs. Not inconceivable for many, agreed, but still quite a hill to climb even for a couple with both in work at average salaries.
    Call it £25k all in? So £12.5k each over 5 years.. Just over £200 a month.

    Average salary is what, £23k for a graduate? That's over £1500 per month salary after student loan deductions. £200 out of £1500 is not quite a hill to climb.


    (Original post by Fullofsurprises)
    Yes, they can reduce their lifestyles a lot to save for it, but for people with children especially that can be tough. Also the £200K places you are talking about are frequently quite small flats with 1 bedroom.
    If you choose to have children at a young age and before purchasing a house then that is (in the overwhelming majority of cases) your own choice. Just as if I chose to spend £500 a month on booze instead of a house deposit, I'd only have myself to blame.
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    (Original post by Reue)
    Call it £25k all in? So £12.5k each over 5 years.. Just over £200 a month.

    Average salary is what, £23k for a graduate? That's over £1500 per month salary after student loan deductions. £200 out of £1500 is not quite a hill to climb.




    If you choose to have children at a young age and before purchasing a house then that is (in the overwhelming majority of cases) your own choice. Just as if I chose to spend £500 a month on booze instead of a house deposit, I'd only have myself to blame.
    PRSOM
 
 
 
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