To ask what you would do - housing related

[dogaibu]

I'm really tussling with this decision, and could really use some outside opinions..

My Dad died, early in 2021. I sold his house, and after splitting the equity with my siblings, I ended up 45,000 pounds.

I rent, have always rented. Buying a home, to me, was just something other people did. Dad's death was unexpected.

After I got the money, DH and I decided to try to buy a home, and we have found a 3 bedroom new build, which we can purchase 75% of in a shared ownership scheme. We got approved for this and moving day is expected to be in March. We currently rent a 2 bedroom house. We have 3 DS's though none together - we have my DS11, who is with us 50/50, and my DSS12 and DSS8, who are with us EOW. We also have a dog and a cat.

We have not actually been permitted to see this house yet. We've only seen a floor plan. They blame Covid when we ask to see it. This makes me very nervous, that we haven't seen it.

Then, there's the finances. This new house will cost an extra £150 more than our current house, there's also a chance of a higher council tax band too. We live to our means. We make around £50,000 a year between us and DH pays nearly £500 a month child maintenance (not begrudging this BTW, it is what it is, just advising where our money goes) it means we have very little left as it is after food, bills, car, social life, pets etc. This mortgage is also only fixed for 2 years, after this it's looking to go up even more.

Then there's the health side. I suffer significant anxiety and depression and my house is my safe space. I once had a terrible time with a neighbour whose dog barked constantly and I'm really scared of the unknown and potentially having another bad neighbour situation, abs being unable to move due to owning the house.

But! The extra room would be great and it does feel like this is our only hope to get on the property ladder.

WWYD? Stay or go? For context we live in the SE where property prices are off the scale expensive

Anyone?? 😊

Make sure you definitely see the house as some people have had problems with new builds. Will it be freehold if shared ownership? If not and it's leasehold make sure there are no hidden costs. Also make sure you take out a mortgage protection policy incase of illness or redundancy

I’d go for it. It’s hard to get on the property ladder, do it while you can. The money will just fritter away otherwise. Property is generally a good long term investment.

I'd definitely buy. I wouldn't want to have to still be paying rent until I die.

I would not make a commitment until you see it. New builds can be very disappointing compared to the brochures

I would definitely want to get on the property ladder given the opportunity but wouldn't be happy buying a house without seeing it

Is there ant other property in the area you want that doesn't involve a shared ownership scheme?

Do not buy. It's very suspicious you can't see it. On top of which you need to make sure that buying doesn't mean an extra commitment to property maintenance which can escalate. It's supposed to be stopped but isn't yet ... but eg you are told there's a £250 pa fee for keeping common spaces and outsides done, but don't read the small print which says it could double every year.

Who is the builder? Can you visit a different one of their sites to make sure it's suitable?

Definitely check if it is leasehold or freehold.

But, a family home is definitely your best bet.

As per other posters please insist on seeing the house. We bought a new built many years ago and it was a high end builder and still had loads of problems. Were glad to get rid and never did it again.
Also think twice about shared ownership schemes unless you really understand the contract and the all the 'small' print. Again, personally would stay well away.
Sorry to sound so negative...but i would look around again and maybe go for something a bit older.

Is take the opportunity to get on the property ladder. It’s a bit more expense be then renting for you now, but will hugely benefit you in the long run as you’ll be paying off the mortgage. You don’t want to be renting once you retire.

Demand to see the house. It’s bizarre you are unable to do this.
I’d be wary of shared ownership personally, they can be hard to sell.

You should be able to view now you have been approved by the housing association.

Shared ownership is always leasehold and you pay rent on the other part (in this case 25%) plus a management charge. It is definitely not the cheapest way to buy but is helpful if your deposit and income multiples limit what you can borrow.

Thank you so much for the comments 😃

Are you using a solicitor recommended by the builders or one you found yourself? It should be one you found yourself.
You need to see the property. Ideally you need to one furnished as it difficult to judge how big a house is empty. COmpare the room sizes with your current house, actually measure your current house. Draw a scale plan where the furniture will go.

Why do much on cm? He's a lovely guy for giving over the odds but maybe he could cut back a little just to give you guys more breathing space.

I wonder if you're buying in the same place as me - shared ownership with a projected completion date of March or April. Shared ownership isn't perfect, its not what I'd have chosen, but DP and I are both old and not high earners so very limited in what we can buy.

With 3 boys plus pets, you're going to need the extra space, and it does sound like this is the best way for you to get it.

Make sure you own more of the house if you put more money in.
And make a will.

It's not that unusual with a new build to not be able to get into it until it is finished. My DS and DDIL are buying a property which will be finished within weeks but they still haven't been able to get into it. Luckily there is a show house of the same type which they have been able to see.

I agree with many other posters that it sounds like a fabulous opportunity to get on the housing ladder, however I would just like to sound a note of caution. I work for a Housing Association and regularly take calls from shared owners who assume that we do their repairs. We don't. Shared owners are in the same boat as actual owners and once the defect period with the builders has expired, will be responsible for all repairs. Please make sure you have factored ongoing maintenance costs into your budget. Shared ownership is a scheme to help people get onto the housing ladder it is not a scheme which mitigates ongoing costs.

Is shared ownership your only option? It can be difficult to exit unless you have the means to staircase up to 100% and even then there are often so many controls over sale that the value of the property can be suppressed relative to an ordinary open market home.

I would definitely buy rather than rent if possible though, even if not getting an extra bedroom. Inflation is likely to rise the next few years so the value of your debt may reduce relative to your income.

Make sure you ringfence your deposit and other interest for your child. Otherwise, you die, he remarries, your child has nothing.

Don’t buy a house you haven’t seen no way!

I would definitely buy in your situation BUT never buy a house that you have never seen and always have a full survey on it. Also do not use solicitors recommended by your mortgage company AND do not touch this house if it leasehold!

Buy, t’s your anxiety talking you down and focusing on the negatives. Don’t let your mental health ruin this for you.

@crosstalk

Do not buy. It's very suspicious you can't see it. On top of which you need to make sure that buying doesn't mean an extra commitment to property maintenance which can escalate. It's supposed to be stopped but isn't yet ... but eg you are told there's a £250 pa fee for keeping common spaces and outsides done, but don't read the small print which says it could double every year.

🤦‍♀️ someone's been reading the daily mail too much

OP why did you fix for only 2 years? If you're concerned about rate rises etc maybe consider fixing for 5 to bridge the gap a bit more between reviewing the mortgage and managing a rate rise.

Secondly these massive maintenance charge bad deals have mostly been phased out after some notable court cases - its VERY rare you've been drawn into one of those but do check with your solicitor OP.

In terms of viewing the house - maybe just insist on it and explain covid or not you're thinking of pulling out. You'd be mad to carry on renting through some misplaced anxiety.

Is this really your only option in the area....I wouldn't be happy with that unless you are in phase 1 of a development you should be able to see an existing house..
Do you know the plot? Area well?...new builds are often delayed if you're phase one do they have any other developments..you could check out..
Do you claim all the benefits you can if your MH is a struggle? Are you getting any help with it...

What do you mean by We 'make' around £50,000 a year between us?

Do you mean you earn £50k gross? Or £50k net? Or some of it is in earnings, some in benefits?

It makes a big difference to affordability and risk.