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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

to consider giving up a housing association house to buy our own house?

31 replies

MistyMountainHop · 17/11/2011 10:26

we have a large 3 bed HA semi

pro's - the rent is affordable (about £200 a month less than market rate round here)

-its a nice, good sized house

-big garden

-secure (as in no landlords going to sling us out on a whim)

-if things go wrong the HA sort it out free (new boiler last winter, god knows what that would have cost in our own home)

cons - its in a pretty grim area (very large midlands council estate)

-its still renting, secure or not

-will have nothing to leave the DC if we stay here

-schools are not great round here

-there is a lot of crime in the area

(there are probably more pro's and cons but these are the main ones)

anyway i am a bit obsessed with owning our own house, and have been looking into it tentatively. we would need to save about £20k for a deposit which i think, with a LOT of cutting back, working overtime (both me and DH) and hard saving, we have some savings already so could probably do in about 18 months.

however, the mortgage would be around £200 - 300 a month more than our rent so things would be very tight, at least till the DCs are older and i can work full time. and if anything happened and we lost the house, we would not be able to get back into social housing.

anyway, sorry its long and rambly! nut what do people think? is it worth trying to buy in this climate or should we just stay put where its cheap and secure (ish) but if we do stay here what will happen when we are old?

OP posts:
FamilyCircus · 17/11/2011 10:33

I'm in a HA flat; rough neighbourhood but otherwise ok. I would buy in a heartbeat if we could afford to. I doubt it will ever happen; DP was retired very early due to ill health and we are in the SE so unlikely to ever get a deposit together let alone be accepted for a mortgage.

I would love to be able to do what I want in my own home without having to get HA permission first.

Original poster
MistyMountainHop · 17/11/2011 10:33

but what do people think (its meant to say in the last paragraph Angry )

OP posts:
OldGreyWassailTest · 17/11/2011 10:38

I would save hard for the deposit, and see where things are in 18 months. I certainly would not buy in the current climate.

You say you would not have anything to leave to the DCs? Nor will you if you have to go into care when you are old - they will take your house to pay for it.

Just save, bide your time and see what happens.

samandi · 17/11/2011 10:39

I would definitely buy. Living in a good area is so much nicer and less stressful, and I'd imagine even moreso if you have kids. Can't see why you wouldn't want to really.

FredFredGeorge · 17/11/2011 10:44

Do the saving up and you'll have cash to leave the DC if that's your aim. House price direction is not super clear and there's no guarantee at all that it will be a good investment (ie you could lose your 20k) and if house prices do increase significantly, then mortgage payments will also (since it will be due to a big recovery in the economy so the low rates will not be required by Bank of England)

The yields on renting are around 5% but you're paying significantly below the market rate, so it would cost you money to own your own home compared to your current situation regardless of any negative risk from house prices falling or losing social housing fallback.

Unless the area is absolutely terrible, I'd really think about staying. You can still use the cheap housing you have to save up and potentially buy in the future if the market changes, or have money to help DC out in the future. Thinking of a mortgage as an enforced savings plan for the children isn't a good way to think of it.

WhereYouLeftIt · 17/11/2011 10:51

Misty,I think you should remove "-will have nothing to leave the DC if we stay here" from the cons, because these days owning a house does not mean you will have anything to leave either - far more likely that it would have to be sold to fund care in your last years.

As for -its still renting, secure or not : so? Owning your own house was a minority thing pre-Thatcher, she pulled out all the stops to make us think that owning your own home was something to aspire to (albeit by largely removing the best alternatives). The idea that renting is throwing money away whereas buying is an investment has taken a firm root, but if you take a step back it ain't necessarily so. It could also be the way to penury, when if the market shifts, and you need to move (for whatever reason). Yes you eventually pay the mortgage off, but you're still paying council tax and all the repairs and upkeep. If you think a boiler is expensive, consider the cost of a roof, a damp-course, rewiring etc. There are distinct advantages to renting, just as there are to owning. Maybe make a list of pros/cons for renting versus owning, without it being tied to where you actually are renting, it might help.

So what would that leave you as your main cons?
"cons - its in a pretty grim area (very large midlands council estate)
-schools are not great round here
-there is a lot of crime in the area"

These three may well be reasons to move, but not necessarily to buy. Could you transfer to another area?

Having said all that, I'm a big believer in keeping myself in the position of having choices available. Things change (e.g. housing market crash, change in lending rules, change in HA rules) and saving a deposit would be no bad thing. It would keep your options open, plus give you a financial cushion for the unexpected.

Floggingmolly · 17/11/2011 10:51

it's the old story, Location, Location, Location. Whether you rent or buy, look to the area first and the actual property second.

SnowChains · 17/11/2011 10:59

buy if you can. You will have no mortgage when you are retired and you would still have to pay rent if you stayed there.

fuzzynavel · 17/11/2011 11:28

Save, save and save some more first until you have quite a bit more than just the deposit.

I rent a housing trust place and have one DS, it's also a one bedroom property but have stayed here due to the fact it is a house split into two flats, I'm on the ground floor with a garden in a lovely street. Have only been offered 2 bed properties on estates so have stayed put.

My plan is to wait until my DS is older, pass the place to him (you can hand it on once) then BF and I will buy out of London.

So, killing two birds with one stone so to speak. Good plan huh Smile

Why not leave it for a while as it sounds that in order to buy at the moment you'd be very strapped in too many other areas. How old are your children? Most primary schools are fine. I'd be inclined to want to move for a good secondary.

FredFredGeorge · 17/11/2011 12:01

snow chains 200 quid a month for the next 25 years will save a lot more money than the rent spent staying there unless you live to a very old age and don't need residential care.

JjingleBeanplusPudalltheway · 17/11/2011 12:46

If you can afford to, do it. Not only for the long term benefits for your dcs but to give that home to someone who could never buy.

TheOriginalNutcracker · 17/11/2011 12:51

I know someone who has just done this. She also lived on a large midlands council estate, in a maisonete above a shop. It was nice and spacious and she had it lovely, but always wanted to move.

She retrained a couple of years ago, and her new job enabled he to save up a deposit. She has now bought a 3 bed house. It's still on the same estate but in a close where most of the houses are bought. The schools are good where we are, so she didn't mind staying in the sameish area.

If you think it is doable then i'd go for it. Just don't stretch yourself too far.

fluffy123 · 17/11/2011 13:14

Start saving now and review things when you have saved the 20k.

fluffy123 · 17/11/2011 13:16

My old housing association had a scheme where you received a lump sum if you gave up your property, could be worth looking into.

mollschambers · 17/11/2011 13:22

Go for it BUT only if you're sure you can afford it.

bananamam · 17/11/2011 13:22

We were in ha house 3 years ago......we came into a bit of money(just as housing prices dropped) so we bought the first house we looked at Blush ....it was the best thing we have ever done!

We have Been here 2.5 years. Redone the kitchen and bathroom, and central heating. We recently had it revalued and it's gone up by 18 k in two years....great investment IMO.

It's not about leaving it for the kids, it may be our retirement fund!! Save....and go for it if you can

Esta3GG · 17/11/2011 13:27

It is a good time to buy - it's a buyers' market. If you are handy at DIY look at auction properties for some real bargains.
Do everything you can to get onto the property ladder.
You really should get out of HA if you can afford to & let someone else into the system.

GypsyMoth · 17/11/2011 13:28

Mutual exchange an option? For better area/schools

VivaLeBeaver · 17/11/2011 13:38

But if you bought could you afford a house in a nice area?

EricNorthmansMistress · 17/11/2011 13:46

I think that using Social Housing subsidised rents to save until you can buy a house is the perfect use of it TBH. I think you should save for the next 18 months then look at the housing market. If you can buy, it's a good idea.

Original poster
MistyMountainHop · 18/11/2011 08:27

have also been looking into rent - to - buy - anyone got any experience of this?

OP posts:
Original poster
MistyMountainHop · 19/11/2011 08:08

guess not then! :o

OP posts:
fluffygal · 19/11/2011 08:21

On the house being sold to pay for care fees-I just did my will and was told if my husband and I change our mortgage to tenants in common instead of joint tenants would mean we then each own a share instead of both owning all. We would then not be forced to sell to pay for care fees as you can't sell half a house,and we can leave our half of the house to our children (we have seperate and joint DCs) instead of each other. If we are joint tenants it would automatically go to each other.

sunshineandbooks · 19/11/2011 08:51

I wouldn't buy in the current market.

I also feel that there are a lot of homeowners who shouldn't really be homeowners because they don't have the necessary funds to do it properly (I am one of them).

If you think things are going to be tight, you can rest assured that it will be tighter than you anticipate. It's not just the mortgage. Your mortgage company will likely insist that you take out some sort of life assurance to pay the mortgage in the event of your debt, you may want to take out mortgage protection in case you lose your jobs, you will need to set aside money every year for basic maintenance of the house, plus, ideally, you would have a couple of thousand in savings to cover emergencies like a new boiler or roof.

Also, while you will get a really good mortgage deal with rates as low as they are at present, the only way this is going to go is up - meaning bigger mortgage payments in the not-too-distant future.

I understand the desire to own your own home because I felt it myself, but unless you can buy somewhere smaller so you're not going to be struggling as much, I'd recommend staying where you are right now and saving the difference to build as big a deposit as you can for when the time is right.

melika · 19/11/2011 09:00

I would buy, it's a good time to buy and knock the price down. You need to get good schools etc so I think it's a perfect time to buy.