Am I out of touch with reality?

[Dreamhols]

Basically I can’t work out what’s affordable or maybe I should say acceptable (as in personally acceptable) to pay as a mortgage. Hands up, I’m used to and accustomed to my low rate of 2% meaning my current mortgage is £700 for a 4 bed house. My fix is coming to an end and rates are, well not 2% anymore, so despite being in the 60% LTV bracket payments are, in my eyes, huge.

so I’d like to hear from other people, given our circumstances (which I’ll list below) what they think would be an acceptable amount to pay on a mortgage. Atm I’m having moments of panic and then thinking it will all be ok, and I’m just out of touch with how much people pay on rent/ mortgages and was lucky with such a low cost for so long.

so both dh and I work. Combined income of 95k (before tax) take home after tax and deductions 5.4k. Childcare costs about £800per month. Protection is part of deductions. Energy is £150 a month. Food about £500. No debts. Car owned outright, petrol £100, Netflix and phones £50 a month. Internet £50, council tax £145.

how much would you consider acceptable or ok to pay? What would your ceiling be?

missed it sorry! Yes you’re right

it was my typo

Childcare really is the biggie, and if the 15funded hrs comes in that will help a bit there but it’s a big if

I think you’ve hugely missed a trick not overpaying while you had such a low rate and enough disposable income to cover it, but nothing to be done about that now.

We pay £1500 mortgage on a similar income and manage fine.

DH and I paid £1300 for mortgage + £900 childcare PCM when our household income was nearer £80k (albeit groceries and utilities were cheaper). It was quite a lot but was manageable

We saved instead, plus I had 2 kids in that time so was on Mat leave twice and had 6 months stat May and then unpaid so couldn’t really afford it then

god you’ve very lucky how little you’ve been paying, you must be saving loads. We pay £1.6k a month on a similar take home. And on a 33 year mortgage term.

Agreed. Saving has been pointless until recently, such low interest rates

I'd consider my mortgage too expensive if it went over 25% of our take home pay. As it is, its only about 14%. We are lucky to live somewhere that we can get a 4bed home for about 115k tho!

We basically invested it in a low/ med risk managed investment

^isa wrapped find

Fgs fund

We spend 21% of our take home income on our mortgage. Our bills are much, much higher than yours, but I’ve just done the sums and we could afford to go to 40% of our take home income, but no more. Don’t know if that helps!

I'd budget more for energy - I know you're on a fix but that's fixing unit rate not monthly amount? If it's a cold winter you'll need more. Also insurance premiums have all really jumped on renewal for me despite no claims

Yeah insurance has gone up, but insurance isn’t really a main concern unless it quintuples isn’t the concern as it’s a one off payment

energy will be fine, we don’t use £150 worth now, we’re well under that so will be in credit come the winter, so it will even out, it did last year

We have the same joint income and slightly higher outgoings. Our mortgage is £1400 a month. I would love it to be lower but it’s on a par with what we’d pay to rent a house like ours in this area. It is what it is. You can’t exactly opt out if you don’t like the best rate you’ve been offered

Rates have come down a bit since our offer but then there’s also a tracker to consider even if the bR moved once more it would still be less than the fixes and as it starts to come down, could benefit from that there

I’d love to know where you can pay £700 pm for a 4 bedroom house

we were paying that for a one bedroom six years ago!

We put a 20% deposit down on a house that was worth 310k on a rate less than 2% on a long term. Mortgage was around £750 when we fixed first and then when rates went lower, went to £700.

midlands and not an especially cheap area either although I guess that’s relative. 3 bed detached now around 280/300k

^ actually I tell a lie, I looked on Zoopla, a 3 bed in a liveable condition is around 300k

Plenty of places on the uk;

https://www.rightmove.co.uk/properties/139894499#/?channel=RES_BUY

https://www.zoopla.co.uk/for-sale/details/65580339/?search_identifier=bb3974b25ce21bd81e2a8cee5b9fac871b0070c2ca6faed49724e9532606ac1e

https://www.rightmove.co.uk/property-for-sale/find.html?locationIdentifier=REGION%5E91990&maxBedrooms=4&minBedrooms=4&maxPrice=100000&propertyTypes=detached%2Csemi-detached%2Cterraced&mustHave=&dontShow=&furnishTypes=&keywords=#prop138667094

Well that’s depressing lol

Umm thanks Land and Country for your very subtle advert but who’s going to apply for a mortgage from someone who can’t even understand OP’s simple question?