To not want to borrow maximum amount? Mortgage with DP

For me it's more about buying what you need rather than maxing yourself out, 380K isn't a target spend. If you think you will have another child and you are going to need a guest bedroom then you will probably want a 4 bed house. Then you can look around for what is available and if that fits in your budget or if you might need to reduce the number of bedrooms or location.
I live in a old council house, it feels a lot smaller now my children are bigger. I don't think I can afford to move but the house has potential for an extension in the future. It also has everything that we need so moving would be for non crusical reasons like having a utility room etc....

As well as all the good points made on this thread, you also have to consider that a more expensive (and therefore presumably bigger) house will be more expensive to run - have you factored in the council tax, the cost to heat, insure and maintain it? And to furnish it if you're going for something bigger than you currently have?

In my experience the bank will lend more than you can comfortably afford to pay back. Just do the calculations yourself, factoring in the extra costs of things like necessary maintenance on a home as well. There’s no landlord to pay for a new boiler when the old one dies!
The bank was shocked when we didn’t want to borrow the maximum amount they were willing to lend. Despite times of financial difficulty we were able to hold on to the house. Having a very large mortgage is stressful and limits what else you can do.

I currently have 5.5, post Truss fiasco so they do lend that much. Divorce downsizing now and reducing it loads but I could port it if I wanted.

I think you also had to factor in how long you plan to stay in the house. Will it be forever or could you move in 10 years

It is a delicate balance between not landing yourself with too much in the way of monthly outgoings that cause stress whilst at the same time acquiring a home in which you can be comfortable and are not cramped or in an area you would prefer not to be.

I have always had a live for today mindset and have taken quite a few risks in my life, so based on this I think you should set the parameters of what sort of home is your basic minimum requirement for a comfortable life then look at the finances that relate to this.

We maxed out and I have regretted it. We are now looking to sell and downsize to a smaller house with a smaller mortgage. We can easily afford our current mortgage, but psychologically it feels uncomfortable as we would not be able to as easily afford it if we had to remortgage at a suddenly much higher rate or if one of us couldn’t work.

It depends how risk averse you are.
We borrowed much less than we were able to because I wanted to cater for some of the foreseeable "what if" scenarios (interest rates rise; one of us loses a job and has to take a lesser well paid one; illness or disability meaning one of us had to reduce hours).

Occasionally I think it would have been nicer to have had a better house.
But having a lower mortgage payment meant we could overpay and therefore paid off the mortgage more quickly. We were then in a position to make savings for our children for uni/house deposits etc. I think this is more worthwhile than having a bigger house.

My parents pay less CT than me although their house is worth more than double 😆

I have lived at max borrowing for the last decade and it is super stressful, so I don’t recommend it now.
But I stretched to get the dream house in dream area and it was worth it - until I’ve had to sell it post divorce. Didn’t see that coming.

If you can limit it to the affordability on one salary that’s ideal but appreciate that isn’t easy.

Whatever your budget I would buy a house in good condition; it costs a small fortune nowadays to do any refurbishment.

@KatsPJs Londoner here too!

I should have not bothered with uni and worked full time in my saturday/holiday shop job. Got one of those interest only/95% mortgages as soon as I turned 18 & bought a flat. By the time I finished uni (2004 ish) prices were completely different.

I paid 5x more than my next door neighbours bought for, 20 years apart.

If you have, in addition to your deposit, a year's worth of mortgage payments, do what you like.
If not, ring fence a years worth of mortgage payments out of your deposit money and then do what you want.

She must still be paying council tax though surely, so she can’t have escaped notice of how high it has become?

I wish I had a time machine when it comes to housing! My parents bought their council house in North London in the early 2000s…I’ll leave you to imagine the price increase!

You also need to chuck in the financial stress of death, illness, job loss, unplanned children or caring responsibilities that come out of nowhere.

Some people have to just survive they have zero choice but you have some choice here. You can never ever get back time, honestly life is for living. It’s just far harder financially for younger generations now. No one picks their birth year and our lives are governed by the times we are born in.

@KatsPJs well take the advice to utilise the right to buy but probably need a time machine for that!

Exactly, my parents made a fortune off right to buy and then made a 40% profit within 6 years on their next house. I absolutely would not take their advice when it comes to finances.

I would be surprised if you could borrow £380k with that income and a dependent. I thought usual maximum for a couple was five times joint income, and then adjust downwards (not sure by how much, I’m certainly no expert) to take into account that you have a dependent. Obviously car loans etc would also be taken into account but you say you don’t have any.

It’s very difficult to know what to do. You need to allow yourself some wiggle room, in case of interest rate increases, unexpected bills, etc.

But, it is sensible to go for the best you can afford. It costs money to move. If you are able to get a place that you would stay in for years by borrowing a bit more, then that’s what you should do.

I didn’t max out and now wishing that I had done, as I’m in a very small place and likely to be here for quite a while longer.

No one ever has any idea if there will be any kind of crash. I have lived through one as a property owner. But I did not need to sell at the time so it was irrelevant.

It does seem to be men overall who push for bigger houses and cars and I feel it’s an ego and chest puffing exercise.

@KatsPJs I am older Gen X and agree with the generations not being comparable. Our friends who bought early in their careers benefited from lower house prices and that’s the majority of them but some of my friends and relatives who delayed buying it’s a hugely different story. The exact house next door to me doubled in price within 2 years of us moving in.

Graph attached to show just how volatile the market can be, it’s not perfect data but gives an indication

I may be naive or unrealistic but I’m not sure how much future growth there is in house prices. It feels as though there’s very little money circulating in the economy relative to previous eras. I think the economy as a whole is in fairly serious trouble.

I agree, historically so much movement was driven by equity gains so if prices stagnate what drives it.

I recently left the industry and that wasn't the case but actually I have just checked and Nationwide are doing 5.5x and 6x for certain buyers. Seems unwise to me!

https://www.nationwide.co.uk/media/news/nationwide-extends-six-times-lending-to-home-movers-and-remortgage

I may be naive or unrealistic but I’m not sure how much future growth there is in house prices. It feels as though there’s very little money circulating in the economy relative to previous eras. I think the economy as a whole is in fairly serious trouble.

I would advise having money left to enjoy life a bit - not only for the above reason.

Agree. My mum was horrified when I shared that our council tax is £320 a month, and said "I've only ever paid £250 a month for my mortgage!!"