To buy a £700k house on £67k

[Polledja]

My wife and I are looking to buy a house. I was very foolish with my money during my younger days so am behind my peers.
we want a house near a good school and houses in that area range from £550k to £700k. The ones my wife likes are at the higher end but I don’t think we can afford these. She has become withdrawn and depressed during this process and it caused allot of tension.
I have approx £280k for a deposit (this is all our savings bar £18k). We can borrow £350k based on our joint salaries of £67k. It leaves me £90k short. I think I could borrow this from family.

our net pay is £3900 per month. We would have £2000 tonoay on our mortgage leaving us with £1900 to pay everything else. We have two young kids at school. Our monthly expenses excluding our mortgage are about £1600 so it would meaning having nothing left each month

I think you'd be mad but then I value stability over a big/ more expensive house. We earn about 100k between us and are very lucky that we no longer have a mortgage. We relocated from SE to my hometown and bought a slightly larger house for half the price (300k) of what we sold our old one. We had long discussions about whether we wanted to get a bigger house and keep the mortgage repayments the same but decided against it and are so pleased we did with mortgage rates and general COL rising. We were able to put 2 lump sums in each pension that year with the extra equity.

We want to enjoy our lives with holidays, days out, meals, working pt etc. we do put almost (about 70%) the equivalent of our old mortgage into LISA/ pension contributions/ ISA for dc. I'd never stretch myself for a house at the cost of a nice living.

Me too! Genuinely interested to know where all the money is going.

I'm clearly in the minority as I actually would prefer a bigger house in a nicer area over expensive holidays, private school etc. But DH and I both WFH, we home educate and in general we are major homebodies so spend the vast majority of our time at home.

I can only assume they have other debt, private schools, car loans?!

Just show your wife this thread, everyone thinks you are mad even to consider this. Either buy what you can afford and upgrade later if you can ever manage it or goon saving hard for a year.

Totally unreasonable to expect your family to give you a massive sum you have no way to pay back too.

Yes but on the OP’s income they can’t afford the house or private schools and expensive holidays.

But it isn’t a choice between a nice house or private schools/expensive holidays. The house his wife wants is so expensive that they could barely afford to live. No new clothes, no hair cuts, no money for repairs of anything which breaks and needs fixing or replacing.

There is no way I would do this.

It's unfortunate that your wife is reacting this way. Understandably, she is disappointed that you can't afford the dream house.

You have a fantastic savings pot - seem to have made up for the foolishness of earlier years.

Your calculations leave no scope for emergencies - the boiler has broken, car broken down, mortgage rates increasing. Not to mention the unthinkable - one of you here sick and can't work.

You both, your wife seemingly more so, are in need of some reality.

You say you would borrow from family - how would you repay them? Is that included in the repayment figure about?

Whilst I understand the desire to go all in on the forever home you do not want to overstretch yourselves to be house rich and cash poor.

Money problems is one of the leading causes of issues in a marriage - which you are seeing already. Don't go in any deeper.

Perhaps, in the fullness of time, your wife and/or yourself could work towards promotions etc and get the dream home later...

The reason the bank won’t give you more is because you can’t afford it and if you’re using your absolute max from the bank plus borrowing 90k you’re heading for bankruptcy and a divorce. Sorry but if it’s tense and causing friction now then it’ll be worse if you do this.

You have a combined income of 250k, a 200k deposit, and wouldn’t buy a 700k house??

So you wouldn’t even borrow 2 x your income?

I'm largely referring to posts claiming they're on 140k but would be unable to afford a mortgage of 330k, which is what the OP is going for.

In the OP’s case it would be a bit mad as the repayments would be ~50% joint income.

But I think the PP was talking about the posters with 6 figure salaries who wouldn’t even borrow 2-3 times their income, or who would be left with several thousand a month after mortgage repayments.

Yes, I was. I think OP cannot afford this and would be crackers to attempt it but I am also 🤔 at posters claiming a 330k mortgage is unaffordable on 140k a year, largely because ours is over 100k more than that on the same salary and we don't struggle at all.

OP the best thing you can do for your own sanity is to buy a house that only requires one of you to pay the mortgage.

If his wife only earns 17k that advice will be pretty much impossible to follow.

This.

This is the kind of scenario that puts hardworking, middle class people into bankruptcy.
Learn to live within your means, the freedom and security of doing so is wonderful!

Your social climber wife needs a reality check before she bankrupts the pair of you.

As for the sulking about it…😳😬

Our house was £330,000. We have a combined income of roughly £50,000.
We had £30,000 in savings and my husband had inherited £50,000 that we put into buying the house. We also had £10,000 equity in our previous house.

We took the plunge, council tax was much more at this new house, bills bigger as house is bigger. It wasn’t loads of room left but we were ok. Now everything has increased. We can afford our house and bills but have very little left over.

Your wife needs to grow up and think properly about the future.

Don't have a mortgage more than 25% of your take home pay is what my parents always said. I don't even know why what and how but that's what they said.

You will never, ever get approved because you simply can't afford it. Your wife needs to get a grip and deal with reality.

My own view is that things change as you age and circumstances also change.

When someone is in their twenties, I would actually encourage them to maximise their mortgage, as property is typically a good investment (and tax free).

However, if you are now in that steady state of thirties or forties, I would agree that you would be wiser to be conservative. Don't compromise with a house that will make you miserable, but find a house you are happy with that you can comfortably afford.

This will give you a home that you can be happy in for the rest of your life, if it comes to that. It will also mean that any surplus cash can be spent on enjoying life. Don't leave yourself in a position where you need to keep working to pay for a lovely house with no fun in your life.

And good luck!

The ones my wife likes are at the higher end but I don’t think we can afford these. She has become withdrawn and depressed during this process and it caused allot of tension.

Definitely sounds like she needs to get her priorities in order. You can definitely afford a nice house, but not a 700K house. Even if by some miracle you get approved for it, you're going to be cutting it fine. You won't have much left over each month so no fancy holidays and luxuries - will your wife then be tense about that?

Everyone wants a nice house, but don't go chasing things that you can't currently comfortably afford. No job is guaranteed, especially in these climate so it's not the best idea to be playing with your finances like this.

Yes and that was significantly easier to do in the 60s and 70s. I don't think it is necessarily realistic advice now.

Do not put all your eggs in one basket by over stretching yourself so much especially when mortgage percentages are going to rise again this year & house prices are so high! Either stay where you are, keep saving & keep looking for a house but be realistic about what you can really afford!
Also you aren’t ‘behind your peers’ you are all living different lives.
Watching others lives will only lead to depression, jealousy & losing focus on what is important in your own life!