House prices

[holymoly2018]

I live in the Greater London area and have been trying desperately to own a property. I pay nearly £1,400 per month where I live and I can't move that far away as I am looking after my elderly mother.

Genuine question - who the hell can afford to snap up these properties where I live? I am seeing 1 bedroom flats go for £250k. FLATS! The average 2 bedroomed terraced house is around the £350k - £400k mark, but all properties are on the market for a matter of weeks before they are sold. There are only so many investors, lottery winners and those who have inherited money. The average Joe Bloggs doesn't earn a salary that could cover a mortgage of this scale, so who is buying them?

[namechangedtoday15]

But the mortgage payments on say a £340,000 mortgage over 25 years at 2% would be very similar to what you're paying in rent. I know you have to find the deposit too and the rate of 2% that I've used is low and you have to afford potential rate increases too.

[SantaClauseMightWork]

Fucking horrid, isn't it? This broken system needs to change. No solution for you, just some .

[LadyLapsang]

I think it's more difficult if you are considering buying somewhere on your own, but otherwise if people have some family help towards a deposit, both parties have been saving and have decent jobs, then it's doable. Take your example of a 350K property, if between the couple they could put down 50k - say their joint savings and money from both sets of parents - then many couples could get a 300K mortgage, however, that would only buy you a very small studio / flat in many parts of London. Have you investigated all the help to buy schemes?

[holymoly2018]

Thanks for the responses. I agree it is doable, but only for a small minority who are given financial help from relatives etc. The flats/houses around here sell pretty quickly and I see young people coming in and out of these properties. I can understand those around the 40+ age mark who are getting inheritance from parents or are on larger salaries. But I would argue that most people under the age of 40 don't have the financial support from families or the income to afford such a large mortgage.

[namechangedtoday15]

I don't think the vast majority of people have help from family or large salaries, but I do think buying whilst you're single is out of reach. You either have to buy as a couple or with a (reliable) friend.

[PleaseSell2018]

We are going on the market soon. The house has been valued at a lot more than what we paid 7 years ago.

What we did was put in our budget on Rightmove and then selected London. DH and I work at opposite ends of London so as long as we could find a decent travel route we would consider it. When we bought where we are now everyone said that's a shit hole I'd never live there. We are 20 mins to London Victoria and 25 to London Bridge - I just didn't understand those comment!

What I'm saying is give up your coffees, sell your Apple phone - just kidding - but if you want to buy, open your search wide. Once you've bought a property and are paying it down it really does help to get to the next stage (we're in a 2 up 2 down and our next step would be 3 bed)

It's frankly frightening to look at the 3 bedders we looked at 7 years ago for £260 - 300k now selling for £500 plus

[holymoly2018]

@PleaseSell2018 - I totally get what you're saying. I think the problem with us is that I have to be close to my mum, otherwise I won't be able to take care of her as often. Like you, we would realistically need a 3 bedder, but they are in the same price bracket as you've mentioned. I sooo wish we had taken the plunge 5 - 7 years ago.

We've managed to save, but our rent went up by £75 per month recently, which has reduced the amount we can set aside. The amount of savings we have is being eclipsed by the increase in house prices, so we're becoming worse off as time goes on. Unless there is a crash in the market, I don't see our situation changing (and I'm in my late thirties now, so getting a mortgage is now or never).

[LOVELYDOVEY05]

I recently found out that you can now get lodger mortgages so a single person can buy with a lodger in the premises .

[RunRabbitRunRabbit]

Buy to let might be useful if you've got savings for a deposit. Buy a flat/house anywhere that is at a price you can afford. Stay renting near your mum. Let out the new flat to cover mortgage, expenses and to cover time between tenants etc. Be a good landlord so you feel happy about this arrangement. Ta-dah, you are on the property ladder.

[holymoly2018]

@RunRabbitRunRabbit :) Nice idea and I think it always looks good on paper. What happens if you can't find tenants and that property is vacant for 3 months, or even worse, tenants who decide to stop paying rent? It happened to my ex. His tenant decided she wanted to study, so gave up her job and stopped paying rent. He couldn't get rid of her for nearly 2 years! That's 2 years he had to pay the mortgage and allow her to stay there for free. When she left, she never had to pay back what she owed. I don't think my anxiety levels would cope with that. :)