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 She has become withdrawn and depressed during this process and it caused allot of tension.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

*buy

50% of pay on a mortgage is insane

I think rough guide is 30% tops

Also says their bills are think £1600 so leaving £300

With council tax and g&e and water they can easily be heading up to £600 like mine is

Then other bills and food petrol etx

Unless I misunderstood what he meant

We live in a cheap town in the East Midlands, income £200k

But it's not the normal for people to earn that much & have very cheap housing is it? Statistically the areas with higher house prices have higher salaries and vice versa.

You need to buy something.
Buy the house that will suit your needs for the next 10 years in one of your desired areas with priority being where your kids will go to secondary school. Set a limit of 600. You can always put extra money in an account ready to buy again in ten years.
You will never forgive yourself if you can not afford food or school expenses.

Your family will be happier without the high stress of going bankrupt and having to move out of their new home.
Research the areas and be prepared to sacrifice a bedroom for a garden or a garden for an extra bedroom. Be prepared to have to paint and redo floor coverings but don't buy a house that needs a massive rebuild unless it is well below your budget and is perfect in every other way.
You should invest in a home because you have a deposit and you will save paying rent. Just don't over extend yourselves.

I know I'm not addressing the OP's question - but I can't help butting in to say that this thread has me thinking I must live in a parallel universe to you all.

My income is £19k per annum, and I recently had to leave my Croft as I had zero savings to make necessary repairs. It was so bad that I was classed as Band A (emergency) for housing by my local Council.

I consider myself incredibly lucky that I now live in a beautiful seaside village in a Council house which is bigger and brighter than the hovel I left, with great access to local towns and public transport. It could have been a junkie infested tower block in the middle of a city if I'd lived in a more populated area of Britain.

Reading all the posts in this thread I think there are a lot of people who just have no idea of how fortunate they are to have a decent house themselves, and as for OP's wife, I cannot for the life of me imagine what she thinks she's done to deserve to just state "I want" and have the world fall over itself to oblige her.

OP, stop being a wimp: tell your wife you can't afford what she wants and let her throw a tantrum if she feels the need to. She has - presumably - a house already.

That makes her hugely privileged compared to these: " Overall, Crisis estimated that around 227,000 people were experiencing the worst forms of homelessness – rough sleeping, sleeping in vans and sheds, and stuck in B&Bs – across England, Scotland and Wales in 2021." And that was 2 years ago, it's undoubtedly worse now.

Same as others have said, don't do it. Our combined income is higher, we just bought a house with a relatively high deposit and decided to stick to 60% LTV. We're now just confortable enough that if one of our job situation change we should be able to manage (with 1, soon 2 young kids).

I know, which is why I’ve repeatedly said upthread that a lot of people have to push themselves financially to buy houses because of the area they live in, and that not everyone has the choice of cheap housing. I was just explicitly asking the question posed by a PP about people who have high salaries in cheap housing areas.

@pompei8309

Brave ?! 😂. Did you mean to write brave ?

Brave is not absolutely tying yourself up financially so you can have the "nice house" but have a nice enough house to allow you to live comfortably. Lots of weekends away, 4 holiday a year, not worrying too much about the interest rises, not having a budget for shopping, being able to save, treat yourself, to our spontaneously. Brave is not having a mortgage which means you have to budget, worry if there's repairs needed, if one of you lose your job and Working to live in your nice house. We don't live in a bed sit by the way we have a decent size house with garden garage etc but we only have 130k equity and I want it paid off by the time I'm 48 so I've got about 17 year left. This man isn't brave to get a house 10x his wage and if he could afford it he wouldn't ask Mumsnet for opinions really would he.

@TrinaLowsln I get about the area, we live slightly away from our ideal but it works for us and gives us flexibility. I understand not everyone will compromise

With the cost of everything rising such as fuel, food, energy interest etc you would really be in a vulnerable situation. Our mortgage is going to increase by £400 a month when our current deal ends, you’ve no room for a scenario like that.

I’m sure the novelty of having her dream house will soon wear off when you can’t afford to do anything other than sit in your house. What life is that for your kids?

You’d be crazy to even consider putting your family in that situation.

You still need to have a life! No lender is going to give you a mortgage when you have to borrow from your family plus having nothing left for contingencies. I can see why she would say have the best you think you can afford but the fact that you have to borrow extra means that you really can’t afford it. By all means, buy a house, but please make sure you can afford to do things as a family too.

OP I don't necessarily think borrowing 350k is undoable especially since your real income is £80k rather than £50k and assuming your partner has more earning potential than £17k?

However you simply can't and shouldn't do it if you need to borrow from family on top (since mortgage lenders will take it into account anyway and knock it off your mortgage offer) so I suggest you keep your budget to closer to £600k because if the worst comes to the worst you may need to ask for a "loan" later down the line. (In fact have you even calculated paying back that loan in your repayments?)

As others have said though your wife being arsey about not getting a £700k house when she earns £17k is the main issue, she needs to bloody grow up, and stop emotionally blackmailing you. :/

To be fair so much of this is about priorities. I can’t imagine wanting 4 holidays a year plus weekend breaks on top, it would just never be a choice I would make unless I had money to burn. I’d always choose a nicer house.

I also don’t care about nice cars etc which someone else mentioned upthread, again I wouldn’t choose to spend on these over a house.

Everyone is different though, and obviously sometimes the nice house really is just unaffordable (like in the OP’s situation) but if there’s a choice to be made then a nicer house will always be more important to me.

Very. Bad. Idea.

Same, a nice (not fancy, not posh, not massive) house in a nice area is always going to be top of my list over anything else.

to live comfortably. Lots of weekends away, 4 holiday a year, not worrying too much about the interest rises, not having a budget for shopping, being able to save, treat yourself, to our spontaneously.

I'm not sure that is comfortable territory. Even if the OP had no mortgage the above would not be a given!

Utter madness!!

@milliondollardress @soffa @TrinaLowsln

Each to their own. Life's about living for me. The happy medium. Not sure having a nice house is that nice if you all can afford to do is sit in it.

The fact that you feel you can ask family to lend you a sum of £90k is a disgrace.

You are a grown up. Pay your own way. You clearly can't afford it.

Is your Wife so spoilt and entitled that she can't get a big house that you both can't afford.

I agree but I can afford to do more than that. My confusion is coming from people on this thread saying they earn over 130k but cannot afford a 330k mortgage. Where is their money going?! I can only assume they have credit card debt, private schools, several holidays a year etc.

No mortgage lender will lend to you if you need a loan from family.

@amiold im not sure why you think im pro the OP spending this much? Of course there's a happy medium! My point was even without a mortgage the OP wouldn't be in the bracket of 4 holidays a year, weekend breaks, no food budget, etc

It won’t be a loan. It’ll be a gift. Legally it’ll be their money, but presumably at some point he will be expected to pay it back.

Welcome to middle England.

@TrinaLowsln @soffa
I think people's money dwindles the moment they start living beyond their means and it spirals and gets hard to control and they get into a cycle of borrowing to pay. Their money is probably going on existing debts for this reason. But yeah I always thought 4x your wage was manageable

So many know so little about what mortgage lenders will and won't do. It is perfectly possible to get a second loan on a property that will not impact on your mortgage offer, you just need enough equity and for the bank lender to be first charge.