How much mortgage to pay each month?

[erhsla14]

How much do you pay per month either as a figure or % of net income?

We are FTB and trying to decide what to do (used to paying a lot on renting, especially when living apart renting separately)

@HardyBuckette my point was I'm not sure how many FTBs are only paying 20%.

My half is 11% of my take home pay. My DH's half is 16% of his take home pay. We havent increased our mortgage as we've earned more over the years. We still pay per month on our mortgage what we used to pay per month on rent as students in 2005!
It means we can afford to do lots of DIY jobs to the house and get it looking really nice. We can also go on holidays, save and are free to make choices that aren't necessarily open to others.

FTB here and will be paying 23% of net income, when we finally finish buying this place. Deposit was 18%.

We have been renting our current place for 7 years and the rent hasn’t increased in that time. We did some mental calcs and figured that if it had increased it would be more than, or match, the mortgage 🤷🏽‍♀️ Rent is 13% of net income.

Mine was that it wouldn't be uncommon in the cheaper areas of the UK. If you buy a property at say 130k, with a 10% deposit, and have a 117k mortgage for 30 years at 2.5%, that's a mortgage of £465 per month. If it's a couple, which is statistically more likely, if they're both working that's likely to be well under 20% of net income. Obviously there are regions where this simply isn't going to happen, but they're not what I was talking about. It's a completely normal thing to do in some areas.

Take home £6500, currently pay £2500. Plan on increasing to £3000 once youngest finishes uni so can pay off before we retire...

We bought our first house last year, we pay 16% of our joint net income. Our payment is more than £500 a month. We are in our mid 30's, I earn less than the national average salary but my fiancé earns more than double which dramatically decreases the % of our joint net income going towards mortgage. I'd say his salary is fairly high for the city we live in.

I'm not disputing that there are areas in the UK where houses are cheap & mortgages low. I just think it's unlikely that it's the norm in those areas that young people say on NMW have full time contracts for example. Deposit is often the hindrance for many & most on low wages would find it hard to save 13k quickly.

In cheaper areas are there statistically more FTBs?

Bought 8 years ago and it’s now 15% of our joint income but when we were FTB back then it was about 30% of our joint income. Both our salaries have increased but also our interest rate was 4.99% when we bought with only a 5% deposit and now I think it’s 1.04% so that’s made a huge difference. We are starting to overpay a little now. Just £50 a month but will probably increase it, but that’s going to knock 3 years off and over £2.5k of interest even if we don’t increase it.

It was about 30% of my net income when I bought, and I continue to pay about 25% of it now but I significantly overpay. I have increased my pay significantly since I bought - if I was on NMW it would be about 35% of income to pay minimum payments as a single home owner.

25% of my overall income currently but my kids' dad pays a chunky amount of maintenance for a 19 year old who is still at home with a long term illness. He is not obliged to.
I downsized recently from a big house which was 33% of income it was unsustainable.

There's a chance I might get promoted and will mean the mortgage will be more like 20% but it's due to run until I'm 74 🙄😞🥹

About 33% - way more than I would have liked but DH lost his job during the pandemic and new one pays significantly less. No child care fees any more though

Obviously there are regions where this simply isn't going to happen, but they're not what I was talking about. It's a completely normal thing to do in some areas

Exactly. A lot of MN can't seem to get their heads around houses costing £100-200k, despite this being perfectly normal in large areas of the country.

Examples in my town for £130k, which is a perfectly nice place to live, lots of nice bars and restaurants, good supermarkets, retail park, big shopping centre, good access to the nearby city centre and on the right side of the city for the park and ride and motorways.

www.rightmove.co.uk/properties/120524846#/?channel=RES_BUY

www.rightmove.co.uk/properties/122677502#/?channel=RES_BUY

Or if you have a bit of a larger budget but still under £200k for 3 bedrooms

www.rightmove.co.uk/properties/122691317#/?channel=RES_BUY

www.rightmove.co.uk/properties/122577662#/?channel=RES_BUY

www.rightmove.co.uk/properties/122760377#/?channel=RES_BUY

You're adding qualifiers to this all the time, though. Nobody said anything about saving quickly, for example, or how long it might have taken at all. Or it being the norm in those areas, as aside to a common thing for FTBs specifically: clearly there are a great many people who do not and could not buy houses. Or that they'd all be on NMW.

The context of this discussion is a poster asking whether the people who are paying below 20% of their income on a mortgage all bought a long time ago. The answer to this is no, because there are still areas of the UK where you can get homes for sub 150k. This is a fact. People in more expensive areas often tend to struggle with it, though.

You're adding qualifiers to this all the time, though

No I'm not. Not once have I said that cheaper homes didn't exist. I just questioned whether it was the norm for FTBs to be buying them.

You 100% are. Saving up quickly, for example, was mentioned by you and only you, and isn't at all relevant to the point made.

And if you think the question was about whether it's the norm for FTBs to be buying these cheaper homes per se, you've entirely misunderstood the question. Everyone knows there are whole regions where this simply wouldn't be applicable.

The context of this discussion is a poster asking whether the people who are paying below 20% of their income on a mortgage all bought a long time ago. The answer to this is no, because there are still areas of the UK where you can get homes for sub 150k. This is a fact.

But the OP is asking from a FTB perspective.
I simply said I don't believe it's the norm even in cheaper areas for FTBs to be on the ladder in the first place & with mortgages of 20% of income.

Saving up quickly, for example, was mentioned by you and only you, and isn't at all relevant to the point made.

Of course it's relevant when discussing FTBs as it's often the deposit & not the repayments that's the problem.

Yes, and I thought the NMW part was very telling as well. Because obviously if you live in cheaper areas of Leeds, or northern Greater Manchester, or Belfast, or Liverpool, or any one of dozens of other places, that's all you could be earning.

Of course it's the norm for FTBs to be buying cheaper homes. That's generally how the housing market works. People save while they live with their parents, or renting, or are given deposits, or use savings from when they were children.

The sort of properties I linked to are prime FTB properties. One of our graduate trainees has just bought a house in our city, as a single person aged around 24. I don't know how much it's cost him or what deposit he had, but I do know what he earns, given that he's highly likely to be on the lowest step of the graduate intake salary so around £28k. Which would qualify him for a mortgage of around £110-£120k, plus if he had £10-20k deposit, buying fees are minimal at that level. It's not that unachievable, and means he would be able to buy the £130k properties I linked to above.

And if you think the question was about whether it's the norm for FTBs to be buying these cheaper homes per se, you've entirely misunderstood the question.

So hang on

I write

"HardyBuckette my point was I'm not sure how many FTBs are only paying 20%."

Your response to that was

"Mine was that it wouldn't be uncommon in the cheaper areas of the UK. "

You responded to my point telling me it wouldn't be uncommon & when I questioned that bit I've misunderstood the question? 🤔

Of course it's the norm for FTBs to be buying cheaper homes.

cheaper in relation to their income?

No it isn't, not remotely. FTBers could easily have taken a long time to save that much up. Sometimes they do.

Ultimately, we seem to have heard a lot about your lack of belief, particularly in the face of people who have actually had these experiences and/or are familiar with the areas being talked about, but nothing much to explain that other than some things you've added that don't actually pertain to the point anyway.

We've just bought a house after renting for several years, and we're late 40's to early 50's so have had to take a mortgage over a shorter period.

%'age wise we're on around 22-28% of net as dh is self employed so this varies. Although we have school age children we have no childcare costs at present as our teenage dd picks up ds several times a week.

@HardyBuckette it was @BarbaraofSeville who wrote the below

Exactly. For a couple, two full time workers on NMW will bring in around £2600 pm and £500 is less than 20% of that amount

I just made the point I'm not sure how many people on NMW are homebuyers since it's often casual or insecure work. Again you can disagree....

Yes, and I thought the NMW part was very telling as well. Because obviously if you live in cheaper areas of Leeds, or northern Greater Manchester, or Belfast, or Liverpool, or any one of dozens of other places, that's all you could be earning

Rubbish. If you live 'in Leeds' or Manchester or Belfast no matter what part, you have access to all manner of jobs, graduate programmes etc, proper jobs with proper wages. People don't just work in the 'cheaper area' that they live in. There's thousands of employers within a few miles offering all sorts of jobs.