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How can anyone afford to get a mortgage when banks supposedly only loan out x3.5 of your yearly salary?

(104 Posts)
TwixBix1 Mon 25-Feb-19 21:59:43

Most people when talking about buying a house always complain about how difficult and long it was to save up enough for the deposit (which is 5% minimum but can be more)..

Yet to me, it seems the deposit isn't too bad and it's finding a mortgage that'll cover the rest which is impossibe.

Say I wanted to buy a £250k flat/house and I pay 20k deposit towards it. That means the mortgage should cover 230k.. if banks only give mortgages up to x3.5 of your salary, surely I''d need to be earning at least £65,000 to get a mortgage for a measly 250k flat or house?

If that's the case, I feel like very few people would be homeowners..

Aside from having a joint mortgage, what's a way to get around this?

Mustbetimeforachange Mon 25-Feb-19 22:01:56

Save up for longer? It's tough.

flumpybear Mon 25-Feb-19 22:04:22

Can you get a guarantor for your mortgage? You could borrow more but check your affordability

Nnnnnineteen Mon 25-Feb-19 22:05:16

Agree. I have a great deposit, but a mortgage only works as long as I want to buy a property 200 miles from friends, family and work...

BMW6 Mon 25-Feb-19 22:05:45

Much bigger deposit or much cheaper property. Our 2 bed terrace cost £118k in 2009, current value £180k, Hampshire.

YeOldeTrout Mon 25-Feb-19 22:07:02

DS is looking to buy on a £20k salary. He has found properties as low as £80k. He is planning a £30-£40k deposit.

I know it's impossible to find property that cheap in some cities but not impossible everywhere.

ChesterGreySideboard Mon 25-Feb-19 22:07:06

That’s the problem.

Buy a cheaper house or flat if you don’t have a working partner. Once you are on the first rung of the ladder you can move up.

titchy Mon 25-Feb-19 22:08:21

Buy with someone else. I don't think many single people have ever been able to buy their own home.

FrostedSnowdrops Mon 25-Feb-19 22:08:58

I couldn't have bought much as a single person. My broker said 4.5 times income though.

blue25 Mon 25-Feb-19 22:09:29

I would say most people either have parental help towards their deposit or they're moving with a lot of equity. We built up over 200k equity before we moved to our second house. Also lots of people here in the SE are earning 50k+ and in double income households.

x2boys Mon 25-Feb-19 22:09:48

Well you could but a small house got about £70-80,000near me

ReaganSomerset Mon 25-Feb-19 22:09:56

I think you need two people, both with decent jobs. Or you get a cheaper house initially, overpay on the mortgage, build up your equity and then if you manage to pay off most of it you will only need a small mortgage on your bigger house because you have so much capital.

Caticorn Mon 25-Feb-19 22:10:04

A lot depends on where you live. £250k is not 'measly' around here!
Lots of people buy as a couple, so £65k salary between you is more achievable.

harrypotterfan1604 Mon 25-Feb-19 22:10:17

You have to find a property that’s within your allows mortgage. I bought a house in 2016 for £79k using a £6k deposit . It’s a 2 bed semi with a large garden and a drive for two cars. I don’t intend on living here forever but it for me on the property ladder and is a nice house it’s just not quite big enough. House is worth at least £110k now too so will make on it too

hidinginthenightgarden Mon 25-Feb-19 22:10:40

I often wonder how people my age have got houses bigger than ours in the same area. Our 3 bed terrace is 200k, the 4 bed detached opposite is owned by a couple a similar age. We got our property because a deceased relative left 25% of our house value to DH. I cannot imagine that in their late 20’s they are earning enough to have a mortgage for £380k! My guess is their story is similar to ours in that some help from family was available.

Violetroselily Mon 25-Feb-19 22:13:23

I've been looking at mortgage calcs alot lately and most lenders seem willing to lend me at least 4.5x my salary

southnownorth Mon 25-Feb-19 22:17:50

250k would get you a fantastic detached house round these parts.

Doesn't it go on affordability now? we need to remortgage soon but I was worrying about it as our outgoings are quite high.

GregoryPeckingDuck Mon 25-Feb-19 22:19:59

We’ve had this problem. In the end property prices grew so much in our area that mortgage repayments would be more than rent so we decided to wait for the next property slump.

thecatsthecats Mon 25-Feb-19 22:22:05

Yes - historically an absolutely miniscule proportion of the global population have owned their own home as a single adult. Living alone as a single adult is only a recent "boom" population.

Chlo1674 Mon 25-Feb-19 22:24:03

We bought a small starter home to get onto the ladder. We didn’t have a deposit but we bought a new build and the house build company was offering to pay the deposit as part of a deal. We found out about this through an independent mortgage broker. We fixed on a very low rate mortgage and paid off additional lump sums whenever we had some spare savings (savings rates weren’t very attractive at the time) to pay the mortgage down. By the time we were ready to buy a bigger house our first home which we had lived in for 12 years had increased in value to give us even more equity. I also know a family who are taking on a lodger to help with the mortgage payments but I wouldn’t feel comfortable with that at all

Chlo1674 Mon 25-Feb-19 22:24:57

There’s also help to buy on new builds.

yellowcoat Mon 25-Feb-19 22:26:17

You do have to buy as a couple, unfortunately if you will never be able to do that it is difficult.

BackforGood Mon 25-Feb-19 22:30:36

1. Most people in the country buy properties that cost a lot less than £250K for a flat
2. There are people that earn huge salaries
3. Many people are given, or inherit money so aren't borrowing it all
4. People buy with other people

DisgraceToTheYChromosome Mon 25-Feb-19 22:31:08

We bought our first house for £29995 in 1992, and sold it for £5 more seven years later. Half a mile away, the same house was making £45k. But after the second murder within 100 yards in the same year...

We bought our previous one for £48k on a good estate in a nice village, but it was in shit order. We still hadn't finished it in 20 years, owing to various circs. It went for £156k, and if we'd been FTBs, we could have only just managed.

MissPhonic Mon 25-Feb-19 22:32:17

"I bought a house in 2016 for £79k using a £6k deposit "

That's just not realistic in most areas. Flats where we live are £130,000+ for a poky 1 bed flat, on the edge of a city, terrible transport links into said city and in a pretty shitty area. 79K here wouldn't even get you a houseboat. (Not London BTW)

CrispbuttyNo1 Mon 25-Feb-19 22:35:37

Part rent / part buy schemes or help to buy are perfect for single people or couples on lower incomes .

HoppityFrog3 Mon 25-Feb-19 22:42:33

@flumpybear

Can you get a guarantor for your mortgage? You could borrow more but check your affordability.

Who the hell would be a guarantor for someone's MORTGAGE (which would probably be £150K to £200K?!) confused

youngmammy Tue 26-Feb-19 07:24:36

My house was only 30k aim for something a little less lavish to get you through you can always go through the process again later in life I'm happy with my little house it was a bit of a fixer upper needed a kitchen fitting and a few bits doing nothing too drastic it's cozy 2bedrooms just what I need xx

AlexaShutUp Tue 26-Feb-19 07:27:55

We saved a 40% before we took out our mortgage. Maybe you need to save for longer and/or look for a cheaper property?

forestafantastica Tue 26-Feb-19 07:32:18

I think a lot of people buy as part of a couple. The people I know who have bought as singles, have bought houses in the £150k range (doable in Scotland where I live) or have had a fairly hefty deposit to put down through inheritance or something.

whatswithtodaytoday Tue 26-Feb-19 07:33:31

youngmammy Where go you live that your house was 30k?! That's less than our deposit!

OP, it sounds like you're in an expensive part of the country. Realistically, you need to buy with someone else (making 65k a decent household income) or buy elsewhere.

The single people I know who've bought have

- saved very, very hard for 10+ years.
- saved hard, bought during the 2007
/8 crash, bought a very tiny flat.
- bought to rent out somewhere cheaper, and uses the rental income to pay part of her rent in London.

ReaganSomerset Tue 26-Feb-19 07:34:21

* I cannot imagine that in their late 20’s they are earning enough to have a mortgage for £380k*

Why on Earth not? Some careers are very lucrative- I know a similarly aged couple with a £500,000 house. Mortgages also don't have to be the full value of the house if you have a large deposit. Get on the ladder early, pay it off quickly and your second house can be quite an upgrade.

Trills Tue 26-Feb-19 07:37:27

Mortgages haven't been calculated on a salary multiplier for years. It's about the affordability calculations now - how much would the repayments be, and how does that relate to your income and outgoings? If you're under 35 they're generally happy to calculate based on a 30-year repayment term.

The answer to "how does anyone afford to get a mortgage" is that most people don't, not on their own. They do it with a second earner, and/or with help from family (or an inheritance).
A high proportion need both a partner and a gift/inheritance.

Kez200 Tue 26-Feb-19 07:42:32

When we first bought in 1991 we had to buy jointly, not in a single name, to afford a small 3 bed terrace.

moosesormeece Tue 26-Feb-19 07:43:27

I bought my lovely flat in a good area for 110k last year with a 5% deposit. It can be done outside the SE.

Everyone I know in the SE who's bought did so with the help of a substantial inheritance.

LordProfFekkoThePenguinPhD Tue 26-Feb-19 07:45:52

I heard recently that in the uk the average deposit is £20k - in London it’s £100k. Bloody hell that’s a lot.

But then when the banks were lending 5/6 times your salary people got badly stung when the recessions hit (and the banks made out like bandits with repossessions).

bsc Tue 26-Feb-19 07:50:48

We saved a deposit of £80k. Only way we could do it. We also worked two jobs each.

youreajetalltheway Tue 26-Feb-19 07:53:06

You can get 100% mortgages with several lenders now, although your parents would have to offer their property as additional security, or lodge some savings as security (at a very good interest rate)

If you are a recently qualified professional some lenders will lend 6x your salary.

Shared ownership, help to buy and the new starter home initiative can all help.

Nows a great time for first time buyers - see a broker

notanothernam Tue 26-Feb-19 07:54:06

The average house price in the whole of the UK is £230,000ish obviously it'll depend on area but straight away you're already looking at more expensive than average homes. Have you looked at how much the mortgage payment would be on a 95% LTV mortgage of about £230k? You're looking at over £1000 so this is why you need a big income to start with, to afford it. Not to mention rates rising. You've either got to have a big deposit or a big income to get a house that price, if you've only got 5% then you'll need a big income. Buying on your own is going to be so much harder, especially if £250k is standard where you are. We have had to buy a small first time home to build equity to buy our forever home later when we have a bigger deposit, I don't want a huge mortgage.

SherlockSays Tue 26-Feb-19 07:56:41

A lot of the time there's 2 salaries to account for and people buy in cheaper areas for their first house - mine was 70k (and only 5 years ago) so our salaries didn't need to be huge, we were then able to quickly move onto the next bigger house.

BettyTips Tue 26-Feb-19 07:57:04

I could borrow exactly 56k. Which would buy me a parking place or half a beach hut 👌

Weetabixandshreddies Tue 26-Feb-19 07:57:12

We are in the SE. There is nothing here for under £200 thousand (including flats) and even then you would struggle to find somewhere.

It's very hard to save for a deposit when you are also paying high rent. My son pays £800 rent per month out of a take home pay of about £1400. Might sound ok but then he has travel costs to pay, some bills etc. He lives there because of his job and it isn't always easy to find another job elsewhere.

mrsm43s Tue 26-Feb-19 07:58:12

Well £250K is not "measly" its above the UK average for a house.

Most people do not expect to get an above average family home for the first buy as a single low paid worker.

Go to some mortgage advisors and get a calculation on how much you can afford based on your salary, your savings and your outgoings. Then look to buy what you can afford based on that. For most people I know, their first property was a studio or one bed flat, and often they had to move to less expensive areas to afford to buy. There's also shared ownership schemes etc which may help.

You need to focus on what you are able to afford, not on what you want. If you do not like what you are able to afford, then you will need to find a way to increase your earnings or your deposit.

BettyTips Tue 26-Feb-19 07:58:29

All the “affordable” properties around here are bought off plan by a conglomerate of landlords.

For conglomerate you can read a group of baby boomers with nothing better to do with their time.

Imicola Tue 26-Feb-19 08:02:29

Well most people start with something a while lot cheaper than 250k and work their way up, although if you are somewhere like London that may be impossible. I would not consider a 250k house to be measly, perhaps you need to either change your standards or live somewhere cheaper. Our current house and previous house were around that price point, both 3 bed with decent gardens in nice areas.

hettie Tue 26-Feb-19 08:02:38

We bought a tiny one bed flat as our first 'house buy'....Why does a first time buyer need a house with garden?

Magenta82 Tue 26-Feb-19 08:03:26

Salary multiples are a very blunt instrument and although people still talk about them they very rarely if ever used when underwritting a mortgage these days.
Affordability is key, they look at your income and outgoings and see how much of a mortgage payment you can afford, they then factor in interest rate changes. The longer you borrow over the more you can likely borrow as it reduces the monthly cost of a repayment mortgage.
If you have been paying rent at a similar amount to the mortgage payments and still saving then it is likely this will be taken into account as evidence that you can cope with the mortgage.

paap1975 Tue 26-Feb-19 08:03:38

I had to save for years (no treats, no holidays, no phone, no tv, etc) to get enough of a deposit, then I came into a little bit which helped. Still, I ended up with something smaller than I wanted and it was very tough. The reason they won't lend you more is that they know people can't keep up with payments (i.e. to protect you from reposession in the future)

VelvetPineapple Tue 26-Feb-19 08:05:18

Most people can’t buy on their own and can’t buy a property that costs £250k. Two people with £20k salary could easily borrow about £140k, which will buy you a flat in some (most?) cities or a small house outside of the city. A lot of people (me included) had to wait for inheritance to be able to buy a bigger house.

clairemcnam Tue 26-Feb-19 08:05:19

Single adults in the past rarely bought houses.
Most people when they buy their first place buy something small. So a 1 bed flat for example, and then build up some equity.

clairemcnam Tue 26-Feb-19 08:06:48

weetabix I have family who have bought in the SE for less than that. But probably in areas you would not consider.

grasspigeons Tue 26-Feb-19 08:07:44

How stuck are you in an expensive area - changing areas isnt always easy but moving somwhere cheaper is how lots of people do it.

CherryPavlova Tue 26-Feb-19 08:07:45

It is hard nowadays in many areas. I know if we were moving to the area we now live in as the young family we couldn’t afford a house big enough to live in.

Our daughter bought in Winchester but had a 80k deposit and now has a huge mortgage. There house has risen in price but that’s not real money as they’ll still need to buy at same price range when they move up to a bigger property.

Our son used armed forces help to buy to boost his deposit. He couldn’t have afforded it otherwise as he’s bought alone as his girlfriend is still at university.

They both went to independent mortgage adviser and got good deals that maximised what they could afford.

CherryPavlova Tue 26-Feb-19 08:09:26

Our sons flat is SE - nice area - and under £250.

anniehm Tue 26-Feb-19 08:09:54

Depends where you live - flats start at £60k here. My friends just bought a house and they are on minimum wage but in London forget it

adaline Tue 26-Feb-19 08:09:59

250k here would buy you a 4-5 bed detached house with huge front and back gardens - it all depends on your location.

Our house is a tiny two-bed terrace that DH bought before we were married - his deposit was 5k.

If you want to live in London or the SE then you need to accept your money really won't go that far!

clairemcnam Tue 26-Feb-19 08:11:33

There are cheaper places to buy in the SE. When people say they can't afford to buy in the SE, what they mean is they can not afford to buy in desirable places in the SE.

eurochick Tue 26-Feb-19 08:14:54

You buy a small flat rather than a house. You buy in a less good area. You buy with someone else.

I can't think of any one I know who started out buying a house on their own, and most of my friends are higher earners (doctors, lawyers, bankers)

downcasteyes Tue 26-Feb-19 08:17:45

OK, sidestepping those with the very obvious point that houses cost more in some areas of the country than others, I think the model for mortgages is very much geared towards a couple with two salaries these days. Which is really rough on those like yourself who are trying to afford a house by themselves. Earning £65k is a big step up from two people earning £30k.

I do know some people who have bought houses with friends or even siblings to get around this problem. It's not an easy one to solve, though.

SouthernComforts Tue 26-Feb-19 08:19:59

It's hard. I rent a bog standard mid terrace and my neighbour just sold for 120k. I live on the outskirts of one of the most deprived towns in England. Wages are low. Most jobs advertised are 18-20k for semi professional roles (credit controller for example). It's extremely difficult to buy on your own here.

EvaHarknessRose Tue 26-Feb-19 08:20:45

I came on to agree with you OP, as I live in an expensive area. But I have taken a look, and there are actually some options locally, flats or one bed apartments, or in a worse area, and similar to how dh and I started out. I guess the dilemma is often being able to rent something nicer vs getting onto the property ladder. And its probably very hard in rural commuter areas especially.

thecatsthecats Tue 26-Feb-19 08:21:41

I'm so pleased to see the realism on this thread. I argued the same points on another forum, and got shot down with 'why shouldn't someone buy the average house? why should they buy below average?'

The problems in the housing market definitely exist, but it doesn't help if you distort the picture. If I lived in the SE, I would have bought a property up north to let out at market value - less, for a good tennant (hopefully somewhere I could eventually live), and used it to build up equity/subsidise my own rent.

adaline Tue 26-Feb-19 08:22:21

* , I think the model for mortgages is very much geared towards a couple with two salaries these days.*

Surely that's only because house prices are much higher these days? Besides, the world was previously geared towards single income families where the dad worked full-time, mum stayed home and kept the house/looked after the children and maybe earned a bit extra taking in ironing or sewing on the side and I know I wouldn't want to go back to that!

UniversalAunt Tue 26-Feb-19 08:22:56

“Single adults in the past rarely bought houses.”

Nor did many couples.

Widespread home ownership, & the expectation of it, is a relatively recent phenomenon. The past 40 years have seen a substantial shift in attitudes about expectations of home ownership & expansion in the financial services sector. For previous generations, credit & mortgages were not readily available, home ownership required higher incomes, proof of financial probity & deposits so for the many long term rentals or council housing were the norm.

Financial deregulation, right-to-buy, buy-to-let, private house building boom, lack of new public housing stock & technology have changed the face of home ownership in the UK in just over a generation.

havingtochangeusernameagain Tue 26-Feb-19 08:24:07

I think people are too hung up on area. If you can't afford the area you want you have to buy elsewhere, that's the brutal reality. You need to be near enough to work to be able to commute sensibly but other than that you need to be flexible. Or can you do your job in a less expensive area? For example, if you were a lawyer, there are lots of law firms that pay well for the area in cities like Liverpool and Leeds. Although the house prices aren't that low for the nice areas. But certainly much lower than in the south east of England.

If you are a teacher or shop worker you can go anywhere. It's only certain jobs that are confined to the south east.

It's a wider problem though - that so many jobs are concentrated in the south-east and so people live there. Rather than having the money spent on HS2, I'd rather see the government invest in decent broadband for all (so more people can work from home) and improve existing rail and cycle infrastructure to allow easier commuting as well as tax breaks to encourage more companies to locate away from the south east. There is no point living near London if you only need to go in one day a week and can work from home the rest of the time. Companies say they can't get the skillset outside the south east but it's chicken and egg, people live there because the jobs are there. And if there were more flexibility, people could work from home/co-working places anywhere in the country. It is beginning to happen, I've worked in London companies where people were based in Northern Ireland, Chester and Doncaster and only came into the office say once or twice a month.

DavetheCat2001 Tue 26-Feb-19 08:24:08

You can find 'sub-prime' mortgage companies that will lend you up to 10x your salary..we are using one for our current house purchase as even though we have over 400k equity in our current property, and OH earns a decent salary, we can't move up to the next level with a multiple of only 3x his salary (London).

You pay a higher interest rate, but the idea is you only remain in the SP mortgage for a short period of time (1-2 years) and then move on to a high street lender.

It's a bit of a risky strategy, and you need to be sure you can make your repayments, but in our case it stacks up and is the only way we can buy the house we want.

Adversecamber22 Tue 26-Feb-19 08:24:08

I can’t remember the exact stats but while doing research around 1998 I noted figures for people living in single person households had risen hugely from the early 1970’s. Now obviously actual house prices are a huge issue but while there have always been single person households the rise and for people to be able to expect to do so much alone is quite new. No one wants to go back to the days of being left on the shelf at 24 which is what my MIL has talked about and you had to get married. I’m just pointing out it’s quite a new development.

DerelictWreck Tue 26-Feb-19 08:26:40

banks only give mortgages up to x3.5 of your salary

Banks give out 4.5x your salary (usually) so that's a bit better already!

LordEmsworth Tue 26-Feb-19 08:27:29

surely I''d need to be earning at least £65,000 to get a mortgage for a measly 250k flat or house?

Hahahahahahahaha. If that's your attitude, you deserve what you get. (I am sitting in the kitchen of my lovely and considerably cheaper home as I type, I realise it won't meet your expectations but that's your problem).

Aaaahfuck Tue 26-Feb-19 08:30:53

We moved away from London to NE and bought a house for 100k. With 6%deposit. The mortgage was based on my partners salary of 43k as I do freelance and short contract work for part time.
One of the main reasons we left London was we couldn't see how we could afford to buy. We would have been happy with a flat but that was out of our price range.

notanothernam Tue 26-Feb-19 08:34:08

As a pp has said I'm really not sure why people are still even quoting 3.5-4.5 x salary, that doesn't mean anything these days, yes that might be the starting point but if you have a car on finance, expensive commute, childcare etc that amount is going to drop, significantly. It's affordability that matters.

Wait4nothing Tue 26-Feb-19 08:34:10

There are still lots of places in the uk where you can get a house at a reasonable price.
I earned around £28k when we bought. House was £108k - so £97.2k mortgage after 10% deposit. So less than 3.5x my annual salary. I was actually married to dh but he was in a new job so they wouldn’t consider his wage (which was better than mine).
Our house is 3 bedroom - room to extend, large kitchen, driveway, garden, quiet village location, within half an hour of 2 towns and 45 mins of 2 cities.

bigcomfypants Tue 26-Feb-19 08:40:18

Buy a grim run down deliatidated terrace in a northern town for £40k, do it up over 5 years as and when you can afford, sell it for £80K. Buy a run down 3 bed ex council house which belonged to a hoarder. Live in it for 3 years same plan. Sell for £106K. Buy the house you wanted all along.
This is how we got on the ladder, and my siblings. It is very very hard work.

Springisallaround Tue 26-Feb-19 08:43:31

I live in one of the areas where the gap between salary and house price is the greatest. It meant even though I had a good professional job, I couldn't buy for a long time. It is extremely frustrating.

I don't know why everyone's saying buying a home is a recent thing, it's not in the UK. My grandparents owned their own home, my parents did and it is our generation that has struggled. Even in the 80's my friends who lived in council houses were buying their own homes (well, from the 80's onwards).

Fishwifecalling Tue 26-Feb-19 08:47:54

I'm hoping that my dd will be able to buy somewhere once she's finished saving her deposit. She'll need a lodger but I'm hoping that if we use our house to guarantee it, or if we have to part own it, then it'll be doable to get her on the property ladder.

claireblueskies Tue 26-Feb-19 08:50:45

In order to buy a property as a single person, I saved up.

It means I bought in my 30s rather than 20s, but in those 10 years, I wasn't just saving money, I was increasing my earning potential by carefully jobhopping for promotion.

You can't rely on an inheritance (that's just grim) or a partner (you can't plan love) so all you can do is get your finances in the best possible shape and save, save, save. If a bank won't lend to you now, doesn't mean they won't in a few years' time. So get ready.

ClaudiaWankleman Tue 26-Feb-19 08:52:19

Hahahahahahahaha. If that's your attitude, you deserve what you get. (I am sitting in the kitchen of my lovely and considerably cheaper home as I type, I realise it won't meet your expectations but that's your problem)

I mean, if that's your attitude, you can whistle.
If you're so obtuse to ignore the very well known fact that property varies substantially in price across the country, and that we aren't all able to move (and might not want to contribute to the terrible BTL market), then there is no hope for you.

£250k doesn't get you much around my parts. Bully for you that you've bought a place though.

SarfE4sticated Tue 26-Feb-19 08:55:20

It's tough OP, which is why so many people leave London (which is where I assume you are) and live in cheaper areas and commute like Medway towns, parts of Essex.
My grandmother, her sister and parents lived in a one bed tenement near the Elephant and Castle in the 1940's, and they were pretty comfortable for working class people. When the sisters got married, they bought a massive house in Putney, and the three families had a floor each. We just have much higher aspirations now.

sansou Tue 26-Feb-19 08:57:55

Buy with someone else so 2 salaries - preferably before you have children so you have less outgoings and more savings
Buy somewhere you can afford - for us, it was an ex local authority "ugly"property in Bracknell. We had previously rented in Camberley, Surrey and couldn't afford to buy there.
As a FTB, lower your expectations!

ItMustBeBedtimeSurely Tue 26-Feb-19 08:58:24

It's not 3.5x any more.

We have always been offered far larger multiples. Last mortgage application in 2017.

adaline Tue 26-Feb-19 09:04:32

* £250k doesn't get you much around my parts. Bully for you that you've bought a place though.*

That's why people move though! I grew up in the SE and there's no way I could afford to buy there. So I moved somewhere affordable where I could buy a home and afford luxuries like a nice phone, a car etc. at the same time.

If people decide they need or want to stay in the SE or London then they need to accept that their income won't go very far. Though in reality nobody needs to live there - they may want to because their family is there or they grew up there or they work in the city but there are always other options.

You just need to weigh up whether not buying a home is worth it in the long run. To some they want that security, to others it's not that important. To each their own at the end of the day.

bsc Tue 26-Feb-19 09:08:48

@hettie Why do first time buyers need a house and a garden? Because the average age of FTB had risen, and many can't buy until they've already begun families!
We were married, mid 30s, and I was 38 weeks pg when we moved into our first bought home.
As it costs so much to move, we didn't want to be having to do it all again in a couple of years if we had another child.

wheelygo Tue 26-Feb-19 09:20:33

Had to admit I had a chuckle at 250k for a measly one bed.
Where I am (Scotland, east coast) that would get a 4 or 5 bed detached house in a nice area! We’re in the process of saving 20k with the view of buying with a 50% mortgage on a one bed.

LordEmsworth Tue 26-Feb-19 09:24:31

@ClaudiaWankleman If you're so obtuse to ignore the very well known fact that property varies substantially in price across the country, and that we aren't all able to move (and might not want to contribute to the terrible BTL market), then there is no hope for you.

OP slags off my home and I am not allowed to be offended? My home is not "measly".

The OP has, at no point, stated they live somewhere expensive - you have made that assumption. The OP has done literally no research into mortgages, or they would know that banks don't use a 3.5 income multiplier for a sole mortgage, so they can't be that bothered about buying.

And what's BTL got to do with the price of fish?

Ariela Tue 26-Feb-19 09:51:39

I do think these days that new buyer expectations are so much higher than 30-40 years ago.
When I bought my first house with the then boyfriend, I worked 4 jobs as did he: pub cleaner, home, change go to work 9-5, home change pub job 6-11.30, Saturday nights I worked in a night club as it was longer hours. Did that for 2 years.
When we moved in we had no fridge, no oven (salad anyone?) no sofa, no bed. We acquired them secondhand. Not brand new colour co-ordinated, made to measure.
We did our own DIY and decorating, we didn't get a firm in to tile, to lay garden paths, to paint or hang wall paper.
We didn't have holidays abroad, we went camping. We never ate out (too busy working anyway).
Etc.
Perfectly possible to save 25%+ deposit, when you barely spent any money.
This is exactly what my nephew and girlfriend have done. Their friends used to tease them for not going out, never treating themselves to Costa for lunch etc, but it all adds up. They're only early 20s but now own their own house, their friends are still renting (and going out, going on holiday etc) with no hope of buying a house. Admittedly they live in DUnstable/Luton area so its cheaper than many southern areas, but even so it is do-able.

notanothernam Tue 26-Feb-19 09:58:27

@Ariela I completely agree expectations are higher, our own house search has been skewed by that. But I think it's also balance, going on holiday, eating out, fun days out are part of life for me. If I was to have died at 25 having spent 5 years of my life putting it on hold to scrimp and save for a house I'd think that was a life wasted for the sake of a house, I think theres a middle ground. Also for us we had children younger (not planned) so it wouldn't be fair to them to limit their childhoods, I don't think, to scrimp and save. We've managed to buy but it's not as big of a house that I'd like for them, hopefully by the time they're in high school we'll be able to upsize, in the meantime holidays and treats are not off the cards.

coffeeforone Tue 26-Feb-19 10:00:13

I think some banks do offer more than 3.5x salary (though I know it's not calculated that way). We got approx 4.5x a few years ago, a broker will help you work out which bank will be best for your circumstances.

But realistically, it's a huge purchase and most would need to go into it with someone else to be able to afford it.

DonttouchthatLarry Tue 26-Feb-19 10:16:03

Sadly it is all about location - round here in the Midlands there are plenty of 3 bed semi's for £150k, so affordable for a couple on around £20k each or a single person on £35k. I know plenty of people who are managing to buy alone or as a couple so don't think it's such a struggle here as in the SE.

bigKiteFlying Tue 26-Feb-19 10:23:42

20 years a go I left university - the house next door was for sale and went for £46,000 - it's now worth £184,000.

It's in one of the few remaining parts of the UK we can afford to buy.

We got on housing ladder by saving a huge deposit, 26%, and waiting when we'd already started our family and finding work in parts of the UK where prices were still affordable.

Ariela Tue 26-Feb-19 10:49:57

@notanothernam But if you were to die you would have had your house, and the kids, just not all the other things ticked on your bucket list. You could say the same about anything you wanted to do. I'd like to go on a cruise one day but it's a lot of money and I cannot justify spending that right now, but won't regret not ever going if I don't go because I'll have done other things in the meantime. Nephew & gf are engaged but see no point in wasting ££ on a wedding for now, kids will be one day.

notanothernam Tue 26-Feb-19 11:00:50

@Ariela but what is a house when you die? (we've always had life insurance so children were covered in terms of inheritance). We had a house before we bought, yes it was rented but it was a roof over our heads, it's that old line of if we were on our death beds would we say "I'm so glad we bought that house" or would it be "I'm so glad we went to all those places" for me it would be the latter. A house is a financial investment that makes more sense in the long term (and yes nice to live in in the mean time), but actually in the short term we must remember to live first! That's what I mean by balance, yes buying was very important to me and we've done it as quickly as we were able within the lifestyle we wanted to live holidays for me are what life is about, experiencing new things, having fun, we may have bought 3 years earlier if we had of saved harder, but I wouldn't give those years up for anything. We managed to buy at 29, we are able to over pay our mortgage now as the childcare has gone down so we're able to lead the lifestyle we want and have our house, we could not go on holiday for the next 3 years and move to a much bigger house quicker, but as a say a house is just one element of life. For me, I appreciate that's subjective! Sorry for the waffle! (Also I have to admit we paid very minimal rent so we able to "live" and save, I appreciate when rent is much higher there is more of an urgency because once you've stepped on you can potentially live more comfortably anyway with a cheaper mortgage!)

Megan2018 Tue 26-Feb-19 11:05:58

I've always been able to borrow 4-5 times salary.
We moved last year and I borrowed 4.25 x salary without any fuss so this wasn't just pre-crash.

There is a big 2.5 bed (nursery or study as 3rd bed tiny) in my village for £245k aimed at FTB.
With a 10% deposit it's just about affordable to a couple earning around £25k each

Roomba Tue 26-Feb-19 11:15:10

It's impossible for many people now. Impossible to save a massive deposit when you are renting and paying even more than you would on a mortgage. It's unsustainable long term, but I don't know what the answer is.

I bought my house at the last possible time where it was possible to do so. A year later and house prices had risen so I'd have been unable to buy my small terrace on my own. I'm glad I did it when I did, as I was paying almost twice as much in rent beforehand. If I'd not inherited £8k from a relative and save like hell living on cheap noddles I would never have been able to buy. My finances have worsened since and wages haven't gone up in 10+ years round here (min wage excepted). It's madness that my neighbours bought their house for £42k in 2003 and sold it for £130k ten years later. Every house sold on my street over the last few years hasn't sold to first time buyers but to buy to let landlords instead.

YahBasic Tue 26-Feb-19 11:25:03

We’ve recently been offered 5x our combined salaries.

That, combined with a significant deposit which we have had no help with, means that we would be that couple opposite @hidinginthenightgarden.

We’re young and have struggled so far with people not taking us seriously as FTB.

wheelygo Tue 26-Feb-19 12:14:23

We’re saving through a combination of my DP working all the hours he can (currently 60+) and me picking up as many shifts as possible in a pub around uni.
Our rent is low because we chose to move to an area which is not so nice but close to our jobs, to reduce travel expenses, and by shopping in Lidl, not eating out much, and we’re not having another foreign holiday til next year.
The way we see it, if we can just save up for a deposit, our mortgage payments would be around the same as our rent payments, so after a year or two of saving our outgoings will be the same and we can then think about holidays in the knowledge that we’re paying our own mortgage rather than someone else’s, and our mortgage could be paid off in 4 years.

LoubyLou1234 Tue 26-Feb-19 12:17:26

It is not impossible to buy as a single person plenty people do it in less expensive areas. It's usually more like 4.5% and these people don't expect to be buying a mansion to get on the ladder.

HotChocolateLover Tue 26-Feb-19 17:48:00

The only way I managed to buy was when I got married. However, when I was single, I had considered purchasing a smaller property in my home city where flats go for about £100k and renting it out. In my city the same is about £300k 😥 At least it would have meant getting on the ladder. Could you consider that for now?

youngmammy Tue 26-Feb-19 19:16:37

Whatswithtoday I'm from the uk Hartlepool

netflixcrazy Tue 26-Feb-19 20:13:52

Here’s how my single friends have bought houses/flats

Bought with siblings
Saved a huge deposit over many years
Have perfect credit score and good relationship with the bank
Good jobs
Parental help
Shared ownership
Bought with a friend
Scraped for a shit hole and got a lodger in until the time came to sell up and move
Moved further north away from expensive south housing

The risk goes down when there’s two of you borrowing so banks are better at lending with more than one person.

netflixcrazy Tue 26-Feb-19 20:14:04

Oh and help to buy

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