To think I’ll never own a house

[NeverOwnAHouse]

NC for this as some details might be outing.

My DH and I have been saving up for a house for quite a few years now. We are both self employed and probably earn around £60k a year between us (closer to 70k on a good year). We pay around £1000 a month in rent at the moment on a very small two bedroom house.

The average house price around here (again for a small two bed) is around £300-350k and as we are both self employed we have been told we’d likely need more than 10% as a deposit. We can’t leave this area because it’s where our work is and to be honest it isn’t much cheaper in the sticks either.

AIBU to think it’s almost impossible to buy a house nowadays?! Especially with no help from parents etc. We are both 30 this year and the PILs are so desperate for us to buy somewhere, but we just have to to keep explaining that we can’t afford it yet. It just feels so unlikely that we will ever be able to buy!

Well it’s not easy but it’s doable.

Have you actually spoken to a mortgage advisor yet? I was shocked to find that because I run my own company despite taking a decent wage I would get a mortgage for £200k less than if I earned the same amount in a proper job.

Expectations reset instantly!

£60k a year without kids I would say you could make considerable savings each month towards a deposit.
With kids and child care costs not so easy.

Really?! That’s insane. My DH spoke to the bank and they said he could get around £180k alone, and we’re both around the same income, so we kind of just went off that. With more and more people going self employed you’d think lenders would take this into consideration.

If you don't have children and childcare costs, with your income you should be able to save a substantial amount every month. Do you have a lot of other debt?

So on a £60k joint income both earning about the same means that you are each earning £2500 a month so £5k a month joint income.
Your rent is £1k and food and utilities can’t come to more than another £1k.
So where does the other£3k go?
Unless you have and have had expensive child care to pay for I don’t see why you don’t have a decent savings pot if you have been saving for a couple of years.

No kids yet but our outgoings always seem to be more than our incomings! My DH gets paid erratically so I do all the main bill stuff each month and he does the shopping etc, but sometimes we have to rely on credit cards until he gets paid again. We have managed to save about 20k so far and have utilised the lifetime ISA bonus last year and will do this year, but that still seems to put us too far away from our goal. When we first started saving we were looking at £270k houses and the prices just keep going up and up quicker than we can save a 15-20% deposit!

Sorry I should say that’s BEFORE tax as well, definitely don’t bring home £5k every month between us after tax. I wish!

£180k seems high for self employed on that wage tbh. Try the calculator here www.santanderforintermediaries.co.uk/

Plus you need at least two years of accounts behind you, making it hard for newly self employed

That calculator is really helpful, thank you! So it’s likely we’ll need a 35-40k deposit to buy... ouch!
I know we are lucky with our income and definitely not pleading poverty, it just seems impossible to save that huge amount of money!

Is the money being plowed back into your businesses? Where is your money going if you have no children?

I know its shite but some people would bite off your hand for £1000 a month rent for a 2 bed. You can pay £1,200 for a one room shared facilities in London and anything up to £1,600 - 1,800 for a 2 bed (which is how ridiculous the whole thing is getting)

10% of 350,000k is around 34,000 and by being very disciplined I can't see why if your joint income is 60k you can't amass this in 3 years or so or even less?

I was 39 when I bought my first house. You have a few years yet.

After tax on £30k a year you bring home £1994 per month each if you are paye. As self employed you probably also put everything that is tax deductible against your tax bill so probably a small saving there.
Even if you go on the lower figure of £4K pm joint income there is still around £2k per month that you could be saving and that is before you include the extra £10k you earn in a good year.

You really need to look at where you are spending If you seriously want to save a decent deposit.

The problem with claiming everything on the tax bill is it makes our income look smaller and therefore makes it harder for us to get a mortgage. It’s a catch-22 situation!

I definitely think we need to start looking harder at our finances though, you’re right. I’m just so overwhelmed by it all!

Ahhh crossed posted. It is doable but you need a clear financial plan. Perhaps set up an appoinment with the bank or a financial advisor looking at ways you can best save or invest your money with the goal of saving for around a 35k deposit. High interest account etc.

Set a budget up.
No expensive holidays (if you do any)
No unnecessary stuff (lattes etc)

Surely you must be decent at this stuff already if you're self employed?

I had no idea being self employed was seen as a liability in terms of getting a mortgage. How shite.

Buy a flat and climb the ladder? You will pay off mortgage and gain equity.

DH and I did it in the southeast with no parental financial help whilst living in a flat and earning around £57k combined. You have to be very strict with budget and take on secondary part time work or overtime we saved 10 percent plus fees and legal plus £25k to renovate

Our deposit was £33k

Essentially try and live almost on one we and save as much as you can from the other. We did manage to holiday while saving as well by doing this

It is possible. I’m a single mum so money is always tight but I buy very untidy but structurally sound houses. The last two have been estate sales after an old person died.
I spend three years stripping them down, redecorating through and replacing carpets, boilers etc.
It’s hard work but I’ve managed to build up a really good deposit. So it can be done. Just takes a lot of weekends.

Where do you live that a first time buyer house is £300-350k? I'm south East with direct links to London and my flat would cost £200k if I bought it today. Maybe re consider what a first time home is.

But £60-£70k household income before tax is, £4K a month income? Where is all your cash going? Even if you allow &1k for rent and a generous £1k for bills and food you should be able to save £2k a month so would have that deposit it 18months?

Where's that OneRing (great name by the way)

I live in Southend, about an hour east of London. Direct links to Liverpool and Fenchurch Street.

I find it mental looking at prices people need to pay around the country for houses!! I live in Yorkshire and you can easily get a nice 3 bed house for less than 200k. I'm on my own and looking for a house up to 150k with 30k equity. For this I expect a semi with three beds, in a nice area, drive way and back garden. It will be a bonus to include a garage and conservatory too. There are fewer that include them but they are definitley out there!!