To ask how you managed to buy a house?

[ditziness]

We pay close to a grand rent a month. It's of our friend's mortgages are cheaper. As a consequence it's very difficult to save. But save we must to tryand get a deposit. So we have to continue to rent

Stuck in a vicious circle.

How the hell did you manage to buy a house?

Any financial, deposit raising, mortgage getting advice welcome

It's all bollocks.

Downsize, as others have suggested.

Relocate to somewhere where property is cheaper to rent while you're saving and to buy when you've got your deposit.

Not sure about the rules on renting then subletting a room - you are allowed to keep up to £4250 p.a. tax free under the government's Rent a Room scheme:
www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/DG_4017804.

What jobs do you and your OH do? Would you be able to find work that offers free accommodation? Jobs like this do exist, look on www.gumtree.co.uk.

Good luck!

Himalaya - same as is said now, property goes in 20 year cycles.

There are "good news for buyers" stories, but no you would not see a "good news for oil companies" in a general newspaper, but you would in a oil companies publication. It's just about tapping into readers.

But 20 years ago, if people were priced out of the market, they could usually get social housing - that's so much harder now - and the amount they'd need to save for a deposit had a saner relation to average salaries.

Is anyone seriously saying that it's as easy to get on to the property ladder now with no financial assistance as it was in 1982? Or 1992 for that matter?

There's also the fact that a lot of people on here are explaining how they have two properties. Having scrimped to get the deposit together for one property, the thought of owning multiple properties is as much a fantasy as owning a tropical island.

Well I can tell you how I've monumentally fucked up any chance of ever buying.... When I got my first job in 1999 DP and I decided to rent instead of buy. I'm an idiot. Then I got made redundant, went back to university to change career (which I couldn't have done if I'd bought admittedly). When i got my current job we then made another fatal decision which was to rent a very big house due to the location and because it accepted dogs - £1500 PCM (N London).
Of course I had DS, childcare costs mean that rent was unrealistic and we're currently living with my parents until we decide WTF to do with ourselves :(

dsyfunctionalme clearly forgets that this was a credit felled boom - the UK housing market has been the victim of a willingness by politicians and banks to flood the country in debt, and have convinced the public through the media that they'll miss the boat, that property is a one way bet and price rises are a great thing. Also by making sure people don't understand pensions, they have created the horrendous buy to let boom, which allows those who can leverage up with more borrowed money to further increase their exposure to the property market at the expense of others who want to save prudently for a large deposit.

one way or another, this house of cards WILL fall.

op - I have more than enough money to buy a house outright. I have scrimped and saved for years - but as this thread shows, letting people chuck borrowed money Willy nilly at a market distorts it. the market does not currently offer value. with wage inflation and no further house price inflation (one route) it may begin to at the expense of my deposit (though I can protect that through investing elsewhere). if the market collapses, we will see fair value eventually. this thread contains hundreds of examples demonstrating the unsustainabilty of the system. Stop worrying and let the situation unravel.

Cheryl do you really think it will all unravel when there is so little social housing being built? Demand for homes is exceeding supply and the state is not stepping in to plug the gap and realistically this Government is not likely to embark on a programme of large scale social housing construction.

Yes, I think the normal market will unravel. It might be slowly, because of the intervention from government (restricting building) and BOE (reducing interest rates), but as credit gets tighter and tighter, the downwards pressure on pricing will increase. All this combined with a reduced ability for FTB's to actually save much at all (thanks to low interest rates reducing compound effects of anything they do put away and the result of price inflation in the basic cost of living) - where can it possibly end?

Estate agents - who seem to have been incredibly slow to realize the importance of actually having transactions to the bottom line of their business, rather than massaging the ego's of sellers by giving them silly valuations in the hope someone with more money than sense actually buys it seem to finally be getting the message too.

Either way, I'm sitting out. If the rest of the country want's to behave like this and hand over most of their income to banks, so be it.

Cheryl
Is credit going to tighten much further, if so why? The Bank of England figures suggest that mortgage lending been fairly stable for the last couple of years since the financial crisis.

www.bankofengland.co.uk/publications/Pages/other/monetary/TrendsinLending/2012/julydataset.aspx

The simple fact that atm you need a large deposit to buy a house is what makes it so hard to get on the property ladder.

Ten years ago, getting a 5% deposit meant my parents had to give me money - if I'd needed 30 or 40%, forget it.

It's worth pointing out that there things which many people have done on this thread to save a deposit/afford a house - moved in with parents/relatives, moved from one part of the country to another to find cheaper houses (which means changing jobs, doesn't it), lived in very shitty areas so they could pay a low rent and save, taken on extra work or a part time job on top of their day job -

These are all MUCH MUCH easier if you don't have children. Young professionals are a much more moveable feast than parents and children.

I also agree with other posters that if there was a bigger pool of social housing in the UK, things would be less pressured in terms of getting on the property ladder. But there isn't - it's got worse over the last 20 years, not better.

Because western nations are in a debt crisis the scale of which is absolutely mindboggling. The financial crisis is still in it's infancy. The problems have been further exacerbated by not taking proper action and cutting all unnecessary spending/or even defaulting 5 years ago. I'll be hammered for saying this but all the media talk about cuts - there are none. We are still spending more than we are taking in - the media makes people think we are cutting debt when we're still running a deficit. They are plate spinning and putting sticking plasters over a fatal wound. All while pouring oil on a fire using quantitative easing.

I simply take heart that I have decent health (touch wood) and enjoy the simple things in life for now, and have faith that one day the prudent shall inherit the earth!

Cheryl people have been sitting back from the housing market for 10 years predicting a huge crash, and it hasn't happened yet.

Prices have levelled a lot since 2007, but employment is steady at the moment so there is no reason why prices should drop significantly.

I'm happy to wait indefinitely. My assets are liquid, they are diversified and I'm well positioned for whatever eventuality. Renting is no hardship either if you don't accumulate tons of consumer crap and have a good relationship with your landlord.

Simply put, banking on low interest rates and further price inflation doesn't sound pleasant.

And as I've said before alibaba - wage inflation is a definite possibility that the powers that be may use as a get out clause to maintain the nominal level of house prices -which is all people seem to care about. It's just got a lot of sour side effects - devaluation of sterling and the associated inported inflation being one of them

I think it is a big mistake to think that all homeowners are clinging on by the skin of their teeth barely affording the mortgage. I am not banking on low rates or further price inflation.
Alterations to planning law make it easier for people to adapt their homes to growing families, removing the need to move. The housing landscape is very different to 5 years ago IMO.

This is true, plenty of people aren't struggling. But like any market, prices are set at the margin. Currently, the transaction levels are low...we'll see what happens down the line. You have your position, I have mine!

I bought my first flat in 1985. It was £35k and I had a 3x salary mortgage and a small inheritance for the rest. There's a similar flat in the same block on the market for £325k now. Admittedly the area has gone from being a desolate post-industrial wasteland to one of the trendiest parts of London, but I still don't regret moving out over 20 years ago.

Even allowing for inflation on the inheritance (there are some websites that can do this), a "back of the envelope" calculation shows I'd need about a 9x mortgage to be able to buy the same flat on a graduate's salary now.

Frankly, it seems an insane amount of money to pay for an adequate but not particularly exciting one-bed flat. But obviously someone can and will, so that's what they cost.

100% mortgage for first flat - those were the days

The hit with negative equity so had to save up £18k to move from 1 bed flat to 3 bed house. Saved my salary for a year and live off one salary.

Bank of Mum and Dad, living at home while saving hard, buying before we had children.

We bought a 2 up 2 down in studentsville Manchester that had no GCH, uPVC windows, proper kitchen etc for £71k in 2003. We had a 10k deposit (most of that was dh's savings before he met me) We sold it for over double that in 2007 (we'd done it up nicely). We sold it within an hour of putting a handmade 'For Sale' sign up due to its location. We had a good deposit to put down on a nice 3 bed semi with a garden. I felt smug when showing dh's parents around as they disapproved of our first house choice and refused to "help" dh in the same way they had with their other kids. Had it not been for that first house there is no way we could have afforded the house we live in now. Our mortgage is under £300 a month. My friend who lives across the road rents her brothers house at "Mates Rates" for £800 a month and that just covers the mortgage.

Bought my place, a small one bedroom flat about 12 months before the global financial crisis. I bought it with savings and some inheritance after one of my parents died, which gave me about a decent deposit - when I asked the real estate guy how people could afford to buy for the first time in that climate he said, "they're either bankers or someone has died".

As an additional point to that, when I went to the bank to get a mortgage, they offered me one for nearly 3 times the one I took - they said on my wages and with interest rates the way they were (I think about 3% or 4% at the time) I could easily afford to borrow more than I wanted and why didn't I want a bigger house? Now I've never been known for being financially astute, but even I could work out that if interest rates went up (or I lost my job) then I would be in big trouble. As it was, I took a much smaller amount, interest rates went up to about 7% for a while and I was very happy living there for three years.

Combination of bank of Mum and Dad, buying 3 years ago when prices not too crazy, living 100s of miles from London, both having well paid jobs and not having any DCs yet. Not surprised that many people don't manage it, that's a pretty lucky combination.

Bought a one bedroom flat as soon as I could get a mortgage ie when got first job and quite young and gradually worked up to a bigger house. Had no deposit so got a "car loan" from a bank to fund it.

Dumb luck?
DH & I probably got one of the last few 100% mortgages, in 2007. Luckily, our house is valued at what it was when we bought it and we've been denting the mortgage. It was our first house and I'm so grateful that we were able to get our mortgage then.
Now we just need a deposit for a bigger house lol.