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Rent/Mortgage - What % of take home income do you spend?

(78 Posts)
escape Thu 01-Aug-13 22:45:59

I am driving myself crazy deciding weather to rent a house that would cost £400 pcm more than I pay currently.
I believe can afford it, and for various reasons it will make me so mch more happier ( lifestyle/sanity!)

Can I ask what % of your households take home income do you spend on rent or mortgage - I want to know if I am being frivolous even contemplating this... TIA.

Sleepyhoglet Thu 01-Aug-13 23:14:58

Would it be better to save that 400pcm to put towards house deposit. That is a good amount to save.

My partner and I have a joint income of £4000 after tax. We spend £800 a month on mortgage so that is about 20% I think.

Sleepyhoglet Thu 01-Aug-13 23:15:33

What is so much better about the more expensive house?

escape Thu 01-Aug-13 23:21:45

I am in such a pickle - but no debt, I guess it's a positive pickle smile
I am self employed, but only have just over years accounts, I can't get a mortgage this year , at least - even though I have a deposit.
400 is a lot of money to put away savings wise, I agree - but the houses are incomparable.
I work from home, am the breadwinner/sole earner and don't even have a suitable workspace - have been doing this for 3 years,
Time to stop being a martyr and get a house that is suitable for all of us. Generally too small ( 3 bed new build end terrace type - bedrooms just big enough for bed type house...)
Thanks for sharing - my % would be much higher than yours.

Cindy34 Thu 01-Aug-13 23:22:52

About 30%.

20%.

Sleepyhoglet Thu 01-Aug-13 23:32:59

Yeah, room for family is important. Do you love this particular house or want something with similar spec? Might be worth putting out feelers to letting agents to get the best house available for price. Remember you can put an offer in and don't necessarily need to pay the full advertised rent.

Will bills and council house be significantly higher/ garden more work?

Sounds like you are keen. I a, just reserved becauase 400 seems a big jump.

messybedhead Thu 01-Aug-13 23:34:01

40%

MrsBungle Thu 01-Aug-13 23:41:25

29%

PogoBob Thu 01-Aug-13 23:44:01

27%, it was 14% up until 9 months ago but had to move from 2 (well 1.5 really) bed house and buy this 3 bed to fit DC2 in.

ogredownstairs Thu 01-Aug-13 23:46:36

what sleepyhoglet says. Although I'm not sure thinking in % terms is all that helpful - i.e 50% of a millionaire's income still leaves plenty to live on, and 15% can be huge for someone on a very low income.

I think life's too short to be squeezed in somewhere too small if you can afford more space - overcrowding can be very stressful. If you've budgeted and are pretty sure it's affordable I'd go with it

LazyMonkeyButler Thu 01-Aug-13 23:50:59

Of our total monthly income, including tax credits and all - about 15%.

But then we are lucky enough to be with a housing association in "affordable housing". To live in the town I was born & grew up in otherwise, we would be looking at about 40-50%.

BackforGood Thu 01-Aug-13 23:54:36

Mine's about 20% but we are coming to the end of our mortgage (ie, bought into the housing market a long time ago), and we are probably both at the top of our earning capacity. When we started out it was considerably different.
That said, a % measurement isn't necessarily helpful - it's more about 'how much you have left to spend' after paying the rent and the council tax, utilities, and other essentials.
I think it depends how realistic it is that you will be able to buy, say in a year or 18months - if that's going to happen then I think I'd 'cope' and save the money... £400 more than you are paying sounds massive... but if you are realistically not going to be able to buy a house for 8 - 10 years, then I'd move and have the space when your family needs it.
Being overcrowded is not great for harmonious relationships.

noisytoys Fri 02-Aug-13 05:48:26

33% but we are due to end a high fix rate soon so it will go down to 25%. Can't wait.

ChickenLickenSticken Fri 02-Aug-13 06:57:46

Eek. Ours is 50% of my net income. DH has just gone self-employed so what he earns is anyone's guess!!

CockyFox Fri 02-Aug-13 07:04:31

40% hopefully I will be back at work before mortgage rates go up or we will be fucked though.

CoTananat Fri 02-Aug-13 07:07:10

40%

Chubfuddler Fri 02-Aug-13 07:10:58

25% (I rent)

JollyHolidayGiant Fri 02-Aug-13 07:23:03

20% at the moment but our income is about to drop so this will jump a little to 22.5%.

I didn't count child benefit as an income although I possibly should have.

LittleBearPad Fri 02-Aug-13 07:33:17

36% but will be much less once I go back to work after maternity leave.

RedHelenB Fri 02-Aug-13 07:40:28

Saving the £400 for a year would give you over £4000 & seems way more sensible to get a mortgage if you can. Or maybe keep looking for a better but cheaper rental option.

bigkidsdidit Fri 02-Aug-13 07:42:20

25%

Ours rent is 21%. But we currently spend another 25% paying off debt. When that's gone, I'm torn between saving for a deposit, and spending more on living in a nicer area! If you can afford the £400, go for it. Good luck smile

20% for the actual mortgage payment but on top of that we overpay by a little each month.

VivaLeBeaver Fri 02-Aug-13 08:05:00

5%

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