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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

AIBU to hope I can afford to buy a little flat?

53 replies

Crash123 · 30/10/2023 22:56

After a 2022 from hell - a breakup followed by bouncing from flat to flat trying to get back on my feet, I've had an offer accepted on a flat... and now I'm freaking out! I really, really want somewhere stable, where I'll never have to leave unless I want to. But I don't want to get in over my head financially. I am pretty frugal, but I don't want to be stretched so far that I cannot enjoy myself, or spend my whole life staying afloat.

Looking at rooms to rent, the prices were almost as high as the mortgage I'd be paying, though obviously the bills are a lot higher going solo, and there's a lot more responsibility owning a flat by myself.

In my day job I earn roughly 45k / year, or 2500 per month, and have a second job waitressing where I earn approx 150-200 extra per month, and could pick up a few extra shifts if I need to make a bit of extra money.

The flat I'm buying has 2 bedrooms, and I am considering getting a lodger (some short term ones, I think, or Monday to Friday ones so I can still have some alone time). My mortgage allows for this.

I have no kids or debt.

Here is the rough monthly budget I have set up based on what I currently do. I've estimated a little high to give myself some breathing room, and can (and likely will have to) cut down on some of these if I need to. I come out to a slight deficit so.. I probably will need to.

Bills:

  • Mortgage - 1100
  • Insurance - 30
  • Council tax - 130
  • Water, gas, electricity, etc - 170
  • Internet - 60
  • Phone - 20

Misc:

  • Groceries - 250
  • Eating out 100
  • Work lunches / coffees etc - 50
  • Transport - 150
  • Hobbies - 100
  • Netflix - 15
  • Haircuts, eyebrows, etc - 50

Savings:

  • Holidays / savings for holidays
  • 150- General saving - 300
  • Saving for flat maintenance - 100

Thoughts? Will I be OK?

OP posts:
Dashel · 31/10/2023 05:41

You keep using the word frugal but for me, that wouldn’t be £150 on work lunches and eating out. Your waitressing is paying for these so only you know if that time is worth it.

I would take your own lunches to work and cut back on the meals out and put that aside for overpaying the mortgage. You have wiggle room in your budget to cut back.

silentpool · 31/10/2023 05:49

As a fellow solo purchaser - I'd recommend setting up lots of little savings pots for the big annual costs like council tax, home insurance etc. I put money aside monthly for those bills and pay them annually so get a discount and no bill shock.

I also save monthly for things I know I'm going to need to buy or replace. It does help you keep on top of things.

Original poster
Crash123 · 31/10/2023 08:50

Fleur405 · 31/10/2023 00:00

I’d say work out what you can afford on your salary from your main job only. If you can afford the essentials plus a little contingency for price rises (even if mortgage is fixed other costs can go up) even if it means no holiday money etc then along with your second job plus the option of a lodger you should be good and have a bit of flexibility. If you do get a lodger I’d save the income towards flat maintenance/ emergency fund.

Oh that's a really good way to do this - thanks. My mortgage stress test didn't take into account a second job or a lodger so theoretically I should be able to do this, but I've started thinking more about extras and quality of life and it's made me a bit nervous. But yeah, if I can make the basics work on one salary I'll be OK.

OP posts:
Mum5net · 31/10/2023 08:58

I will DM you my DC's column of figures later this morning. Broadly similar situation and income. They have option to take in lodger across the summer. We discussed almost exactly what @Fleur405 said above.

BibbleandSqwauk · 31/10/2023 09:04

I see that you are on London so the answer to this may well be no, but where I am in the NE there are one and two bed flats available for significantly less than 100k - nice areas in nice towns. Looking at one for my stepson who is 22 - he could get a mortgage for 60k and have his own place. As you have no kids, are you absolutely tied to the south? Sorry if that's totally out of the question and irrelevant.

Original poster
Crash123 · 31/10/2023 09:04

Abitofalark · 31/10/2023 00:35

You are set fair and well done on getting your flat even though it's a big step and scary on your own. The first rule is not to panic and let it overwhelm you. Trust yourself. You are capable and will overcome and manage very well.

You could probably halve food and internet and phone without too much effort. Your allowance for energy may be a bit tight - I've found electricity is surprisingly steep and it is all too easy to consume a lot of gas heating - but there are many variables that could affect this. Are you on a water meter, is the flat well insulated and what type of heating, which providers etc.?

As you say, it's a rough budget and you need to do a proper detailed one, with allowance for clothing, dry cleaning, household cleaning, electrical and electronic purchases, furnishings, linen, crockery, pots and pans, lighting, decorating, torches, batteries and basic tools, repairs and maintenance (insurance excess), occasional events and invitations, concerts, outings, weddings, day trips or weekends away, incidental expenses such as present-buying and family and no doubt other headings that will emerge as you work through.

Ahh thanks for this. I was going off the average I googled for utilities, and then added some extra for food since cooking is a hobby but it's absolutely something I could cut down on if I needed to.

And yeah, you're right to say I should break this down further. It all feels a bit overwhelming, or like I am missing something. I want to set myself up well for the future while still being able to say yes to events with friends and enjoy my life a bit, you know? I worry a bit about fomo / feeling isolated.

OP posts:
BrioNotBiro · 31/10/2023 09:52

You sound very sensible OP and you and other posters have covered most bases.

As well as all the utilitarian pots, I had (still have!) a 'Treat' pot where I put some money away every month and let it build up. I could ONLY blow this on things that I really wanted but my common sense told me I had better calls on my money.

It saved me from feeling everything was just scrimping and making economies in those first years of a mortgage - though you seem to have a very balanced budget especially if you take in a lodger.

Good luck OP it's an exciting, if scary, time!

Clarinet1 · 31/10/2023 10:09

Just a thought - is the council tax figure you quote net of the single person discount? If so you would pay 25% less but, then again, you would lose the discount if you had a lodger for
any length of time so that is worth thinking about in your budget and when setting rent.
Also, if you fix the mortgage for 5 years, what is the likelihood that your pay will rise significantly through promotion/job move etc in that
time? Obviously, that could give you a lot of “wiggle” room.

Clarinet1 · 31/10/2023 10:11

Oops should be “If not”, obvs!

OldTinHat · 31/10/2023 10:21

TV licence?

Bonbontutu · 31/10/2023 11:23

Critical illness and life insurance needs to be added to your outgoings too :)

madamehooch · 31/10/2023 12:13

I would reiterate checking the terms of your lease regarding maintenance of the block and communal areas. If you're only paying a minimal amount per month, what is going to happen if the roof needs repairing or the hallways need decorating. Does this figure cover insurance of the block? You will need to have separate contents insurance. I would strongly, strongly recommend once again putting money aside every month to cover these costs so that you are not subjected to unforeseen repair costs in the future.

Mum5net · 31/10/2023 12:27

Thank you @madamehooch, my DC has not left enough contingency for additional repair.
OP, I have sent you a PM with DC's figures but the headings now look like this:

EXPENDITURE

Mortgage
Life Assurance
Council tax 75%
Water rates
Service fee
Ground rent
Major repair contingency
Buildings Insurance
Contents Insurance
Energy & gas
Broadband
TV Licence
House Insurance
Car insurance
Car repairs & service
Car & petrol
Public transport
Mobile
Celebrations
Food & Living
Holidays
Savings
TOTAL

Abitofalark · 31/10/2023 12:56

Clarinet1 · 31/10/2023 10:09

Just a thought - is the council tax figure you quote net of the single person discount? If so you would pay 25% less but, then again, you would lose the discount if you had a lodger for
any length of time so that is worth thinking about in your budget and when setting rent.
Also, if you fix the mortgage for 5 years, what is the likelihood that your pay will rise significantly through promotion/job move etc in that
time? Obviously, that could give you a lot of “wiggle” room.

Except that you wouldn't lose the single person discount if your lodger was a student. You'd need to check your local council's criteria for 'student', for example whether it means part-time or full-time student or other.

PuttingDownRoots · 31/10/2023 13:04

Re phone and Internet... as DH weekly commutes he has an unlimited data plan and pays a lot less than that for his phone, and the Internet is good enough for streaming.

Original poster
Crash123 · 31/10/2023 13:06

marshmallowfinder · 31/10/2023 03:31

I'm in a small 2 bedroom flat and we pay 280 per quarter for maintenance fees to cover cleaning communal areas, building insurance, window cleaning, fire alarms, gardening and saving for bigger jobs (roof repairs, car park maintenance, new hallway carpets etc etc. This is still low for a flat apparently.) How on earth are there no fees at your place? Very worrying, since it means you'll need to shell out large, unforseen sums when problems and repairs come up and there's no sink fund. Are you sure that's right, OP? Seems quite precarious to me.

Oh dear. A few people have flagged this so I'll double-check with the EA. Thank you.

OP posts:
Original poster
Crash123 · 31/10/2023 13:08

Caspianberg · 31/10/2023 04:56

What you could do is look at getting a lodger for the first 5 years. Yes it’s a bit annoying sharing, but the extra lodger payments you could use to help set up flat and to overpay on mortgage. Then in 5 years time when mortgage fix rate end man you would have already overpaid at a time when then interest is the highest and should be able to keep mortgage around same or even lower.

That's the thinking. It's not ideal by any stretch, and my hope would be that I wouldn't need them the full 5 years, but I could get shorter term ones / Monday - Friday ones so I can still have my own space every now and again.

OP posts:
Original poster
Crash123 · 31/10/2023 13:09

Totaly · 31/10/2023 05:07

I did similar when young. I also had a lodger.
Food budget is high but that’s a good thing.
My first home made £20K which made moving to a bigger place easier. The next house make £50K which then helped with moving again. Current home we have £250K equity. It builds up.

This is what you should also think about for the future. You’ll lose less money when you buy.

Oh gosh, good for you. That's amazing.

I'm hoping that I can build up some equity... I'm scared of going through life solo, renting forever and never being able to relax or retire. So that's what I'm trying to avoid by buying.

OP posts:
Original poster
Crash123 · 31/10/2023 13:11

Dashel · 31/10/2023 05:41

You keep using the word frugal but for me, that wouldn’t be £150 on work lunches and eating out. Your waitressing is paying for these so only you know if that time is worth it.

I would take your own lunches to work and cut back on the meals out and put that aside for overpaying the mortgage. You have wiggle room in your budget to cut back.

This is a very good point. I guess I should say that I am capable of being frugal. I am around some things, but I do adore food (and travel) so tend to splash out there when I have the spare cash. I've budgeted for how I'd like to live, a bit, but could absolutely cut back here if I needed to.

OP posts:
CheshireDing · 31/10/2023 13:14

There is no way the service charge is that OP

you won’t need buildings insurance as it will be included within the service charge payment (or will be a separate payment each tenant makes towards the buildings insurance) but you might want contents and or life insurance

you really need to check service charge though, it’s either wrong info you have been given (which I suspect) or if there is no service charge payable then how are major works (eg roof repairs, new communal carpets etx) going to be paid for ?

orangelotus · 31/10/2023 13:15

I didn't read everything but a colleague of mine does air b and b with her spare room so only has people when it suits her rather than a long term person. She is in a v unfashionable east London suburb and gets lots of return people.?She just had a free stay in Berlin with one of her regular guests!!
If you don't want a permanent person

Lochness1975 · 31/10/2023 13:23

Any subscriptions- Netflix, Spotify, Apple TV, Hello fresh etc?

UnderwaterSpaceCadet · 31/10/2023 13:23

I know others are suggesting life insurance, but if you don’t have children or a partner (not sure whether you do or not), you might want to look at critical illness insurance and / or income protection insurance as more of a priority, unless you get either of those through work.

1983Louise · 31/10/2023 13:31

If the flat is leasehold have you checked the length of the lease, under 80 years and it can become a problem. I'm surprised the service charges are low, what happened if a new roof is needed, is there a sink fund. I think you need to look into.in more detail, do your research, we lost thousand buying a leasehold flat.

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