AIBU to wonder how people afford huge mortgages and we’re struggling to make ends meet?

[Beanbag12]

AIBU to wonder how people afford huge mortgages and we’re struggling to make ends meet?

We live in a very affluent area in rural Oxfordshire. We rent. The idea of saving for a 10% mortgage is so completely unrealistic as the cheapest 2 beds around here are £220k. We currently spend more than our wages every month (high cost of living, childcare costs). Everyone, and I mean everyone that I work with either already owns or are buying hugely expensive houses. They’re on similar wages to me. AIBU to wonder how the divide between us is so big?

I know this probably has obvious answers; we should have been more sensible when we were younger, inheritance etc. but I’m interested in other’s experiences in this.
I don't really want to divulge any more information about our situation and I don't want advice (I know people will say it's our fault we're in our situation, which I am willing to accept, so no critisism please)

Bought 1st flat age 25 with inheritance from grandfather. Put in new bathroom and redecorated (with help from dad who is a builder although did lot of grunt work myself). Partner moved in we got married. Sold flat bought best situated house which needed a lot of modernising on an ex council estate. Did up house with inheritance from other grandfather. Been fortunate that area has now come up a lot and new secondary school being built 10 mins walk away. Dont plan to move again til the kids have grown up or ive won the lottery

We saved a deposit and bought a very tiny, grotty maisonette in our late twenties. Then we saved some more, and the value of the maisonette increased a bit, meaning that we were able to sell it to get a mortgage on a nicer, two bed terrace. Only then did we have our two children. We then waited a bit longer and saved a bit more (by which the two bed terrace was rather cramped), before we were able to get a mortgage on a three bed terrace. So we now have a nice family home (though by no means a palace) in a nice area. It's true that this wouldn't have been possible if we were in minimum-wage jobs, but we also wouldn't have been able to afford a decent house without both many years of saving and a willingness to start out with a very modest property, and waiting to have our children until we were able to get somewhere another (small) step up. Neither of us have ever inherited more than a few hundred pounds.

Buying before having DC was key for us. Buying jointly with 2 decent salaries at the ages of 27 & 30, so not particularly young but it meant that we didn't need any help to buy a cheap house in an undesirable area. We didn't care about location particularly other than it was the mid point commute wise for both our jobs. We also weren't picky until after we had DC and had to think about schools for House Choice No:3. We're now in our late 40's and living in our "forever" home (No:4) mortgage free. We've moved twice due to redundancy and twice for job promotions.

Hubby and I both moved back in with our parents after finishing uni and saved for about a year to get a deposit for a flat and to pay fees etc. We were sensible and bought so that we wouldn’t be stretching my ourselves with high mortgage payements. We were luckily that we only needed a 3% deposit, it was at the time of the credit crunch and after signing our mortgage the lowest deposit went up to 10% we would have had to save for so much longer to get that. We lived there for 6 years from 2007-2013 and when we came to sell we sold for the same as we had bought it for. But we had about £18,000 equity and a lot saved ( although looking back I spent so much on crap as I had so much money left over at the end of the month!) we then moved we to our forever home again not stretching ourselves too much. That was just after we had our first son. I returned to work full time so finances were good but after our second son I just returned part time and we are just about breaking even at the moment. Our mortgage is coming to an end soon though and when we come to remortgage as our house value has gone up significantly in the last five years we will have about £80,000 + equity which means we’ll be able to get a much better and affordable mortgage when we remortgage. Next year we’ll also get 30 hours free childcare which will help.
Basically you need to get on the property ladder as soon as you can, definitely before children and save as much as possible before children too. I also think you need to consider how much your mortgage payments will be each month and if you’re planning on reducing your working hours will you still be able to pay your mortgage.

@curiousaboutsamphire your life sounds balanced and lovely, especially the bit with the chickens. Friend has them, they are just so brilliant. Love spending time with them.

We had a lot of financial family help.

We bought before kids too. Scrimped a 5% deposit, flat for under 100k, then did the whole kids and marriage etc.

The only way we can afford to move now is because we have the equity in this home as the deposit for the next one.

Didn't buy before DC. Lived in a 2 bed council flat then moved to 3 bed council house, luckily for us right to buy gave us 43% off as council tenants so 1st property cost 25k , lived there for 12yrs, moved to another town bought 3 bed detached house 140k - forever home, very scary time when we had 2 mortgages for 6 months but finally sold for 70k, paid off previous mortgage then put remainder in to existing mortgage but also have to add we were very lucky as I used to work for a bank so had a staff rate mortgage (base rate ). Good luck OP

Bought my first house with dh at 23 just before the boom. We made quite a lot on it when we sold it a few years later which enabled us to buy this home. I think we where lucky we decided to buy when we did

Sorry- am 40, DH 45- both have professional jobs, earn well by any standards- no way could ever afford to buy in oxfordshire (currently rent here). Parents baby boomers and of generation/age to benefit from housing boom. Others had help. A lot of help. I and my husband have student debt, children, and will never be able to afford to buy here- wealthy baby boom generation plus economy over inflated house prices and priced us out a decade ago- missed the time with low house prices, haven’t inherited yet (won’t be much anyway, but would rather parents lived to old age and spent it tbh) now juggling childcare etc and worrying about pensions. I am a doctor, he is a commercial director. Property here is ridiculously overpriced for what it is, and everyone seems to be chasing the money to afford to live here (south east) without managing to enjoy it. We are moving back to Yorkshire where although higher than they should be we can afford to contemplate buying a house. Sorry to rant but thats the truth as I see it- people now in their 40s are screwed by the generation above and the generation below perhapsmore so!

@CuriousaboutSamphire I'm sorry about my earlier comment, it was rude of me to make a judgement like that and even worse to not come back and apologise straight away.
Your choices are different to mine but your life sounds lovely, I've always wanted chickens. Please ignore my previous comment, I was in a terrible mood and shouldn't have said anything

There is no way I would ever say it is easy to buy now however, it’s worth remembering that interest rates were significantly higher back in the day. If my memory serves me right, my 2 bed house cost me £50k in 1997. I was paying £400 monthly in interest and £75 in to an endowment. I think I was bringing home just over £1000 a month.

The other change is that most properties are now developed. As a pp mentioned, councils even used to give grants to ‘modernise’ properties to help improve the housing stock. I don’t think there are as many ‘do-er uppers’ any more.

Married, both working, saved like made, bought small badly needed renovated terraced house. Took two years to fix doing most of the work other than central heating electrics, ourself. Had DC1 two years sold made profit, moved to larger house (semi) DC2, . Was SAHM until youngest 6 years. Waited until incomes increased to allow further move to better area. No foreign holidays, camping in UK, no expensive type cars, no regular nights out. We had an aim and kept to the programme to get what we wanted.

Same as you OP where we live the houses are so expensive. Both DH and I bought (separately) in 2005 and both properties proved to be a nightmare and never increased in value. Now we just work to pay rent/ childcare and all the other bills. I’ve made my peace with it tbh a home is a home regardless of ownership IMO - we would never be able to save the £40-£80k we would need for a deposit. My friends all in the midlands live in massive house and have small bills. They either bought earlier than us (pre 2005) and/ or got help from mums and dads. We live the best we can for our kids

Pure luck for me. Bought house for £67k which was 3.5 times my wages in 1996. House now worth £350k. House value has increased x5 yet my wage has not even doubled!

Aside from family help/inheritance and cash winfall, what I can gather is the most important aspect in getting on the property ladder is having a partner/being in a couple, ideally from a young age (e.g. early 20s), giving you time to amass large joint savings. People take it for granted but a double income makes all the difference and being in a relationship with a man, who has a statistically greater chance of having a higher income, helps.

All the comments here are 'we, we, we' did this and that. If you are single you are basically screwed when it comes to getting a property. I feel for the women who can't get onto the property ladder because they're not a 'smug married' and then the shitty realisation that they better find a partner if they want a house!

Like inheritance, couple-dom is a case of luck.

Bought a house cheap at 21 (also in sunny Oxfordshire) that needed a ton of work. Lived in it throughout.. ie no hot running water, damp, no electric upstairs, etc.

Sold it, reaped the benefits, have saved like crazy whilst in a rental and have just re-bought a 'family house, same post code as the original' with the equity from House one and savings...

Just as bloody well.. baby mark one is enroute!

Peoples houses often look lovely, but don't be fooled, lots of people have done the decorating legwork to get there!

By being really fucking lucky. Bought a big 3 bed in a shit area in the housing dip for £150k, MIL part owned with 1/3 money and we took out a mortgage for the rest. We paid her back the £50k+£20k after 5 years out of savings and the equity the house had built up.

Couldn't afford the house now as it's now "worth" £320k.

Frugal 20s. OH brought his first flat when I was 20. We brought a family house together age 23. We did the house up all before children.
Have since moved to a property which we completely knocked down and built our dream house.
Getting a mortgage before children is key

We were lucky enough to buy in the days of 100% mortgages. We also only borrowed about 2/3 of what we could have done because we didn’t want to overstretch ourselves.

We were very lucky with timing also. In the next 2 years houses like the one we were in more than doubled in value, no way would we have been able to get on the housing ladder without help just that short space of time later.

EROD, wouldn’t say the key is buying before kids, we bought when our kids were late teens. Before that we had lived abroad for a decade renting, moved back to UK and rented for years whilst saving, managed to save 90k in 4 years with no help at all just managed to get decent paying jobs and only went on holiday once a year (as opposed to our usual 3) as well as stopped eating out so much, taking homemade lunches to work etc - little,easy changes that really add up. neither of us will have inheritance and all our parents are alive (thankfully) so we had only ourselves. We still made sure kids did their activities, but we sacrificed for 4 years and now have a house and slowly starting to get our lives back, haha.
As Martin Lewis (money show) said, you could buy a coffee each morning by that is £2.50 that is not being speaks on a future house. Same with lunch - that money doesn’t eating out could go toward a house.

Re-read my post, maybe saying 3 hols a year sounds a bit boastful - it’s not, we normally stay with friends or family (a lot of whom we have all over the planet) so we just pay flights/ shopping. Not much cost really.

Bought before marriage and children basically. Uni, a year's full on work, travelled the 3rd world for 18 months which really changed us I think for the better. We learned so much more about the value of money and that you don't need all the consumer crap.
Lived with parents (opposite sides of the country) when we returned and paid our way with them whilst we saved for a deposit.
Bought first property a year later for £72k (expensive part of Kent). It was the best thing we did. A run down ex council house which we spent the next 6 years doing up when we could afford it. During this time we married but waited 3 years to begin a family as we knew it would be difficult to afford to move after having children as I wanted to be a full time mum.
Sold for £185k and moved on to a £265k property that again needed doing up. I should say that during those first 6 years we changed our mortgage deal every year and over paid when we could and it took 10 years and £1000s off of our mortgage.
We sold that 3 years ago and the equity and our savings meant that we could afford a £500k property which we have now extended/ renovated etc and is worth approx £700k.
We are here for the long term now and feel that we have earned it! It has taken over 20 years of hard physical graft but on this property our mortgage is just £395 per month.
My tips are to live with parents if poss until you can save a deposit as it is difficult to get out of the renting trap. Buy property that needs work as opposed to new build - try and do as much work on it as you can. Change your mortgage deal often. We also don't spend much on cars etc - would rather put the money into living in a nice property.

I have a mortgage of over £700k.
I don't advise it.

I should add that our monthly payments are £2700 per month.
Which is all fine but if my DH lost his job, we might find ourselves in a spot of bother.