to want to get on with our lives now

[WantsALife]

DP and I have been living together for a year now, and are thinking about starting a family. We're currently renting a nice place, but I want to get us settled in our own home before we start TTC.

DP is quite careful with money (though is generous), and says he wants to wait, because in his words 'the housing market is due for a big drop and I'm not handing over my hard earned to pay off other peoples mortgages'. We're in our early thirties, and he has saved up about 90k (I have about 20k). We both have reasonable paid jobs - not brilliant but with the deposit money could get a cheap mortgage easily.

He won't do it though, and says that I'm not thinking long term and that if we keep saving we'll get a good place with little or no mortgage eventually, or that or 'everyone's wages will have to explode' . Aargh - I just want to get our lives started! AIBU?

[MooncupGoddess]

Yes, I have an offset with FirstDirect; I pay my 'repayments' into a monthly 8% saver.

Agree that the supply and demand argument is rather simplistic; certainly didn't stop prices falling 2008-11. Demand is only relevant if it's realistic demand, ie backed up with a deposit, mortgage offer etc. Banks are becoming stricter, too, which reduces prices on average as they are a function of credit availability.

But - as I said earlier - it all depends on the sort of property you want.

[BoulevardOfBrokenSleep]

I was going to suggest taking a 25-year offset mortgage and overpaying into it, like skaen said.

You can keep the savings 'pot' nominally separate from the mortgage 'pot', so you can still access it if you need/want, but you get the equivalent of mortgage rate return on your savings.

And you can still be mortgage-free in X years, with no penalty fees.

[Sallyingforth]

"I see economic fundamentals very differently from you"

You're welcome to see them any way you like, and if you want to stand the entire capitalist system on its head you can do that too. But supply and demand has never failed yet.

[goingupinsmoke]

Euroshagmore - and there lies the problem "I'm not sure where the money is coming from"

If your going to put money on it I'll put money on a fall, I do think there are estate agents lurking

[skaen]

oh yes and get married!

[skaen]

Op, have a look at the sorts of mortgages there are available. DH and I borrowed on a 25 year offset mortgage through First Direct and paid it off last year 7 years into the term - no penalties. It also means you can continue to have liquid savings which you can draw on if you need to.

[QuickLookBusy]

I think your DP has doubts about your commitment to her.

YOU want a child, but you won't get married or buy a house with her?

Why would/should she have a child with someone who will not commit?

[WantsALife]

Do not get me started on 'economists' Euro. Trust me I will bore you to death.

[EuroShagmore]

OP, I am very anti debt as well and the only debt I have is my mortgage. I see that as completely worthwhile.

BTW, I bought our current house at the start of the recession in 2008, when houseprices had dropped a chunk and were dropping further. It wasn't an ideal time, but (like you, potentially) I was driven to do it because neither of us wanted to live at the other one's flat. It is now worth about £30k MORE than we paid for it then. This is in SE London. I'm not sure where the money is coming from, but prices are definitely not dropping. And I don't believe they will in future.

In fact now, with low interest rates on savings and prices pretty close to as low as they are going to get in London and the South East (in my opinion and in the prediction of many economists - just look at some economic forecasts), is about the best time possible for you to enter the market. If you wait, I would put money on it that prices will rise and you will get less for your money as the interest you are earning on your savings will not keep pace.

[WantsALife]

Sallying are you an estate agent? I see economic fundamentals very differently from you.

[DontmindifIdo]

yep, we didn't borrow anywhere near what we could get when we bought as I was already pregnant and not sure if I would go back to work - but as we got the mortgage with both our wages taken into account and no dependents, we got a great deal. Worth looking before you have DCs.

[Sallyingforth]

I can't tell you OP what to do about your family but I can say that anyone waiting for a big fall in house prices is going to wear out their thumbs twiddling. It's a simple matter of supply and demand.
There are more people looking for housing now than ever before, and fewer house being built. At the moment house prices are wavering about a little, but rents continue to rise.
When this recession ends, as they always do, there will be many people like you who have been waiting for the confidence to buy and prices will shoot up again.

[HeartsTrumpDiamonds]

Oh FFS

1. Marry the woman
   
2. Create a home together
   
3. Have babies
   
4. Live happily ever after
   

1. is obviously the stumbling block. You've done your thread, now get your OH to do a thread on here "Do I really need bricks-and-mortar before TTC?". Then discuss like grownups, hopefully AFTER she has an engagement ring on her finger.
   

Good luck OP, you sound like a solid guy who just needs reminding that there is more to life than APR's.

[MrsHoarder]

A better mortgage doesn't always mean bigger, I meant with better rates. The more you look able to afford a mortgage the better offers are available to you.

Anyway, good luck and don't forget to update us cos we're nosy

[WantsALife]

. Anyway, I'd better leave it. I'll let you all know what happens. Thanks for all the advice - much appreciated.

[WilsonFrickett]

Yes OP. We do get that you're not a fan of borrowing .

[WantsALife]

MrsHoarder, wouldn't want a 'better' (i.e. bigger) mortgage based on our salaries pre-kids compared to post. Why borrow more than is necessary, or take on a longer term than is necessary. I think by now you know I am not a fan of borrowing.

[MooncupGoddess]

Ah yes, that is it - but the repaying mortgage capital is saving (in economic terms) so I'm not sure you're comparing like with like re the rent?

I dunno, I'm all for being sensible and working out financial scenarios carefully, but given that you're in a very comfortable situation anyway I think you're shooting yourself in the foot here.

[WantsALife]

Littlebairn - I was replying to a poster called highlands - we live in the south east! And there is no compromise on part time work. That is absolutely non-negotiable as I guarantee the relationship would not last anyway if I was full-time. I turn into even more of a horror.

[MrsHoarder]

You may well be able to overpay as well. We can overpay 5% of the balance each year. And if you apply for a mortgage now it will be based on your income without kids so that will get you a slightly better mortgage.

[BegoniaBigtoes]

OP you sound like a robot. Aren't there two of you in this relationship?

a) you might not be right. Hard to grasp, I know.
You might not be right
You might not be right
You might not be right
Sunk in yet?

b) It's not the end of the world if some money gets - horrors! - "wasted" i.e. not used in the most efficient possible way. Borrowing to buy a house is not ideal, it's messy, it's expensive but so are your other options - renting is a massive waste of money. Get used to the fact you can't control everything.

c) I suspect you are one of those people who find it hard to relax unless every penny is accounted for and you feel completely in control of finances to a ridiculous degree. Now that tendency can be extremely useful and of course saves you getting into horrible debt situations, but it doesn't make a relationship. Give and take is necessary. Imagine what it's like to live with you. Imagine your DP actually has a valid POV and could teach you something.

[LittleBairn]

Accepting that neither of you will compromise She won't start a family unless you buy a house you want to save another 90k. Let's not forget time is precious here your DP fertilty is decreasing while you wait.....

You work part time because that's what you prefer, would you consider working full time for 2-3 years to save up faster cutting back down to part time once your DP was pregnant?

That way you can buy the house quicker, have a baby quicker and get on with your life.

Another point property in the Highlands doesn't cost as much compared to most southern areas if your really want a Baby NOW and you also need to buy a house in order for your DP to do so why not look at cheaper properties? There are properties for 110k in the highlands.

[WantsALife]

Mooncup - the difference is my mortgage would be 14 years (the minimum term I have to take out to be allowed to borrow 110000 on our salaries after we've had kids), your's is presumably 25?

[HecatePropylaea]

Yup. Good luck with it anyway. Whatever the two of you as a couple decide.

ahem.



Don't forget to tell us how it all worked out.

We're nosy.

[MooncupGoddess]

Well, I spent years lookking at the economic fundamentals and thinking that house prices had to fall - and they did in most areas of the UK, and on nasty modern flats everywhere. But the lovely Victorian property in London I wanted kept going up - because it's limited in supply and there are always enough financially comfortable people who want it.

I'm not quite convinced about your maths - I have a mortgage about the same size as you'd be aiming for, and I pay £270 a month interest plus an extra £300 in repayments. The cost of maintenance is significant, though.

Can you do a proper risk analysis (ie allow for interest rates going up, childcare, possibility of one of you losing your job) and see if you can buy your ideal long-term property on those terms? There's absolutely no point buying a 1 or 2 bed property at this stage in your life, that really would be throwing money away.