Active discussions

Meet the Other Phone. Child-safe in minutes.

Meet the Other Phone.
Child-safe in minutes.

Buy now

Please or to access all these features

Talk
AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To just be so upset about house prices

550 replies

spuddy56 · 07/06/2022 17:13

We started looking in December after scrimping and saving for years and its got more and more out of reach with every passing week since then. We've had two sales fall through due to downvaluations, so not only did we need the huge deposit we had saved up for years, we needed 10k on top of that which is impossible for us. We are paying rent and have no family help. We viewed a tiny house that we love and has been on the market since beginning of April with no offers but the seller won't budge on the price. Based on one year of sold prices in the area its about 40k too much, even taking into account the 10% rises over the last 12 months. Theres just no way a mortgage company would lend that much. Been to view another one and it's tiny, has had no offers and is worth a lot less but agents don't think they will go lower. We've had to adjust our expectations down and down despite being what we thought were healthy earners. How are first time buyers managing to buy right now without help?! I'm so so upset at not having somewhere to settle and call a permanent home.

OP posts:
Anastar23 · 09/06/2022 19:54

Yanbu
house prices are crazy atm! Can you wait? The housing market will fall.

gimmepeaceandsky · 09/06/2022 20:10

The current situation is really shocking and I don’t know how our children will ever afford a house as well.
We are selling at the moment. Our house was evaluated at more than 100% since we bought it - £120K more now- and as good as it sounds we will also need to buy after selling and again set up a new mortgage due to the high price.
it’s absolutely ridiculous as it seems a never ending story.
I’m sorry for this OP, the only way is keep saving and cutting expenses where you can and hope for the best. Start small, you will get there !

Thebeastofsleep · 09/06/2022 20:22

80sMum · 07/06/2022 17:40

I feel so sorry for young people today, with house prices being so ludicrously high and rent also being very costly.

Back in the 1970s, it was possible to rent a "dump" (eg a grotty bedsit, with shared bathroom) for very little, so that you had money to save each month. DH rented such a place for a year before we were married. I vaguely recall it was about £12 a week rent, plus 50p in the meter if you wanted the heating on (DH used to sit in bed in the evenings, wearing 2 jumpers and a coat, as he refused to spend even 50p on using the gas fire! 🤣).

I'm aghast at the rental costs nowadays. Over £1k a month for a small flat - and bedsits seem no longer to exist, at least not in my area anyway. How do people save if they're paying out that much in rent every month?

Flat shares.

DH and I shared a double room in a 4 bed house with 5 other people. Only 1 bathroom. Was awful but was £350 a month plus bills.

Willowsodyssey · 09/06/2022 20:27

It’s possible there is a correction coming to house prices because of the economy, so sit tight a bit longer. We were in this position a few years ago. I’m in my fifties now and have seen some ups and downs in the housing market. When you do go for it, make sure you don’t borrow to the hilt with no breathing space. I’m concerned that people have not seen the interest rates at close to 15% as I have!

LimaCharlieHotelPapa · 09/06/2022 20:27

Iamthewombat · 07/06/2022 17:55

It may not feel like it, but your prospective lenders are doing you a favour.

They have declined to lend you too much money to buy an overvalued house. They aren’t daft. The mortgage is secured on the house, so when prices correct - and it’s when, not if - they want to be certain of recouping a reasonable proportion of the money they have lent you. If they can’t, they’ll come after you for the difference if the house is repossessed. That’s worst case. Best case is you end up frittering all your wealth servicing a massive mortgage to buy an asset that’s worth less than you borrowed.

Let’s say that they loan you £350k to buy a tiny house, because that is what the sellers are asking. Interest rates go up, buyers can’t afford to service big mortgages so aren’t entering the market, prices necessarily reduce. It’s the smaller houses that are hit first. You’d be in negative equity and unable to move because you can’t sell at a high enough price.

Take your current circumstances as a warning from the universe. Have you seen inflation rates? Increased interest rates is the cure for inflation but it’s painful for borrowers. The only thing keeping the housing market going at the moment is huge mortgages over 30, 35 and 40 year terms. I wouldn’t want to be one of those borrowers.

As hard as it is to stomach, I do agree with this. I couldn't afford to buy in London and had to move to another county in order to buy a house. I was unbelievably lucky as well because literally a month or two later and I would have been priced out the market, with no hope of getting back in realistically.

But once I'd moved in I realised how tough it was still going to be, even though I thought I'd planned well, because there were repairs I didn't anticipate, furniture I needed etc etc, none of which could I afford. Things like additional moving costs and extra rent I hadn't anticipated had eaten into the little reserves I had, because I threw as much as I could into the deposit to get a lower mortgage ratio.

I believe the market will start to get better (maybe not for a while, obviously). At the moment houses are going for well above what they're actually worth and I'm not sure anyone in the cycle can sustain that (very interested to hear experts on this one as I'm definitely not one!!).

Good luck and don't overstretch yourself or settle for something that doesn't feel right just because it's within your budget. Try to save as much as you can, check for the best interest rates (e.g., are you eligible for a Lifetime ISA as this can be put towards a first house purchase) and look at all areas that are feasible to live in (even search auctions as there can be some good options there). Really hope you find something!

Leontine · 09/06/2022 21:23

I can really relate to having to lower your expectations again and again. I got there in the end but I’m still feeling a bit traumatised by the whole experience, so much so that it’s put me off moving ever again even though I know this house isn’t really practical long term.

Nocutenamesleft · 09/06/2022 21:38

Oh I feel you. We’ve just brought our first house and it’s costs us a fortune. Not just the house but the stamp duty. The fees. I was aghast at the prices and wonder how anyone in lower salaries than us do it.

Mollymoostoo · 09/06/2022 21:46

We are in the same position. We don't qualify for help to buy qs we have both previously been home owners (with ex's) and despite having £25k deposit we can't get anything where we live. We have looked within a 10 mile radius but DD will have to move schools and cost of commute for me will be considerably more.
Sellers are asking ridiculous prices and even though houses have been on sale for months, they won't budge. I blame the estate agents who are hoping for more commission.

A friend of my DH was advised by his financial advisor not to buy now as he will end up in negative equity within a year. We are going to keep saving and see how the market is in 12 months but as we are both now 46, time is ticking on a mortgage term.

Roxy69 · 09/06/2022 21:53

I feel your pain. The same thing is happening to me, as time goes on my options are reduced because of house increases and also the majority of estate agents are playing games. Not to mention the proliferation of auctions which are another money-making exercise for them. If I kept getting surveys for auction houses I would be well out of the running for anything. I am already looking well out of my area, how depressing it all is.

Blondeshavemorefun · 09/06/2022 22:44

bellac11 · 09/06/2022 19:21

Sounds like the perfect scam to ensure we're all paying for a service not many of us will need, straight into the pockets of banking and insurance companies.

Show quote history

The banks wouldn’t profit. Anyone can insure them

just amazes me how people don’t have life insurance then when their partner dies they are a screwed

DashboardConfessional · 09/06/2022 22:57

Blondeshavemorefun · 09/06/2022 22:44

The banks wouldn’t profit. Anyone can insure them

just amazes me how people don’t have life insurance then when their partner dies they are a screwed

Show quote history

Once you are of a certain age (over 30!) and or have had any health issues, even periods of stress off work etc as opposed to critical illness, it's not cheap. Life and critical illness on a £136k mortgage for us was £75 a month. A lot of people are having to stick that into their energy bills instead.

AnnabelC · 09/06/2022 23:07

Buy anything, anywhere in the Country that is up and coming. Rent it out and sell it when you get equity in it for a bigger deposit.

Iamthewombat · 09/06/2022 23:24

AnnabelC · 09/06/2022 23:07

Buy anything, anywhere in the Country that is up and coming. Rent it out and sell it when you get equity in it for a bigger deposit.

Yeah, great idea. Buy at the very top of the market in an area you don’t want to live in. Hurry whilst stocks last! What could possibly go wrong?

The ‘up and coming’ thing really makes me laugh. I’ve read several studies indicating that everyone living outside a posh area believes that their particular town or suburb is ‘up and coming’, whether it is or not. Nobody ever describes their own area as on the skids or ‘down and going’, do they? Funny, that.

I saw an extract from the PM’s speech on the news at ten. When the prime minister is suggesting allowing benefits to count as income for mortgage purposes, does that fill you with confidence about the robustness of current values? Does it? Or does it sound like a desperate attempt to pump more money in to prop up prices?

Does anyone remember the credit crunch? I do. It was precipitated by US ‘NINJA’ (no income, no job) mortgages. How little we learn. The Big Short (book and film) explains it well.

Iamthewombat · 09/06/2022 23:34

The banks wouldn’t profit. Anyone can insure them

(‘them’ being life insurance policies, where a couple over-leverage themselves and need two incomes to service their mortgage, and one dies).

Who do you think should be selling life insurance policies, if not licenced financial institutions? Your corner shop? Boohoo dot com? EBay?

Give me strength. In order to sell this type of product you need capital strength in order to meet your liabilities should they arise. Do you want to be in a position where your life insurer is saying, oh yeah, sorry your husband died and you can’t pay your mortgage an’ all but we haven’t got enough reserves to pay you, soz?

That is why, in order to sell life insurance products, you have to prove that you are good for the money. Which requires a massive infrastructure of actuaries, fund managers and finance experts. Just like you’d find in a financial institution, in fact. A bit like a bank, or a big insurer who understands Solvency II.

Grrrrdarling · 10/06/2022 00:55

spuddy56 · 07/06/2022 17:13

We started looking in December after scrimping and saving for years and its got more and more out of reach with every passing week since then. We've had two sales fall through due to downvaluations, so not only did we need the huge deposit we had saved up for years, we needed 10k on top of that which is impossible for us. We are paying rent and have no family help. We viewed a tiny house that we love and has been on the market since beginning of April with no offers but the seller won't budge on the price. Based on one year of sold prices in the area its about 40k too much, even taking into account the 10% rises over the last 12 months. Theres just no way a mortgage company would lend that much. Been to view another one and it's tiny, has had no offers and is worth a lot less but agents don't think they will go lower. We've had to adjust our expectations down and down despite being what we thought were healthy earners. How are first time buyers managing to buy right now without help?! I'm so so upset at not having somewhere to settle and call a permanent home.

Honestly it is horrendous how bad things are right but but my advice would be to save your money, keep adding to it & wait for the bottom to fall out of the market.
it will happen, it has happened before & you will be in a strong position when it does happen.

boardey · 10/06/2022 03:01

Buy anything, anywhere in the Country that is up and coming. Rent it out and sell it when you get equity in it for a bigger deposit

Isn't the issue that it's much harder to build equity these days?

Lily4444 · 10/06/2022 05:44

I’m so sorry it’s the most disheartening thing. I have enough for a deposit but can’t get a mortgage here. I think it’s a problem that’s only going to get worse as the UK is small so land and housing is always going to be expensive. Renting is also getting worse.

tbh I’ve completely given up on the idea of buying here and was actually looking at moving to Finland before brexit. Currently I’m moving to Ireland having bought a tiny house and hopefully once I have Irish citizenship I’ll then be able to go on to Finland where housing is much better priced (outside Helsinki). I know it’s probably not that helpful but if possible I’d consider actually looking outside the UK

Mfsf · 10/06/2022 07:07

Wait 6 months as house prices are about to go down

VK456 · 10/06/2022 07:39

My heart goes out to you.
I live in a small terrace. A property opposite was on the market for over a year. They went to a different estate agent and ended up with 2 offers for £30K more than the asking price. Difficult to come to terms with.

Threetulips · 10/06/2022 07:41

I think we have run out of buyers!

several new houses round here aren't sold yet, whereas before things have been snapped up quickly. Open days were the norm. This means n a few weeks they’ll be open to offers. Not over asking price.

Wont take long before EA have to price them realistically.

AnnabelC · 10/06/2022 09:22

Omg. It was just a suggestion. It’s worked for friends of mine. It means you have an asset and getting income to cover the mortgage. I just know how frustrating it is to work hard and desperately want to have more control over where you live.

Blondeshavemorefun · 10/06/2022 09:33

DashboardConfessional · 09/06/2022 22:57

Once you are of a certain age (over 30!) and or have had any health issues, even periods of stress off work etc as opposed to critical illness, it's not cheap. Life and critical illness on a £136k mortgage for us was £75 a month. A lot of people are having to stick that into their energy bills instead.

Show quote history

Dh died 11yrs ago. Many didn’t have life insurance then in my way group

can’t use the increase of gas and electricity for that

guess they didn’t think would need it

no one thinks their partner will die young

Original poster
spuddy56 · 10/06/2022 09:38

Lily4444 · 10/06/2022 05:44

I’m so sorry it’s the most disheartening thing. I have enough for a deposit but can’t get a mortgage here. I think it’s a problem that’s only going to get worse as the UK is small so land and housing is always going to be expensive. Renting is also getting worse.

tbh I’ve completely given up on the idea of buying here and was actually looking at moving to Finland before brexit. Currently I’m moving to Ireland having bought a tiny house and hopefully once I have Irish citizenship I’ll then be able to go on to Finland where housing is much better priced (outside Helsinki). I know it’s probably not that helpful but if possible I’d consider actually looking outside the UK

I think this is really interesting and we are considering it. My partner is originally from Europe and I am trying to learn his language. Its not going that well to be honest. 🤣 if we don't succeed in settling here we will move to his home country. But reading these responses I really wonder if we should just make that plan a, not b.

OP posts:
gillyff · 10/06/2022 09:44

Tbh I think that will become far more common & luckily my family are European. However it's gone to completely exacerbate the ageing population issue.

Nothappyatwork · 10/06/2022 09:49

AnnabelC · 10/06/2022 09:22

Omg. It was just a suggestion. It’s worked for friends of mine. It means you have an asset and getting income to cover the mortgage. I just know how frustrating it is to work hard and desperately want to have more control over where you live.

It worked well for me I bought the kids houses while they were in university and literally just sold one to the next set of parents for more or less what I paid for them plus costs they were thrilled that it wasn’t massively inflated and of course I saved nearly 40 grand in rent for the kids and I didn’t miss £100 a month each I built up in equity over the 5 years.