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AIBU?

House-buying budget - how much did you keep in savings?

41 replies

MNUse · 14/01/2024 21:45

Not really an AIBU, and I’m really sorry if the title is annoying/offensive or to some given that house-buying at all let alone house-buying with savings reserved is so hard at the moment. But if you did buy a house and were in a position to reserve some savings as well, how much did you keep for savings vs spending on house budget? Basically looking to buy and wondering whether to try and spend at the top of my budget in order to try and get somewhere I love and could stay a long time in (with say about a fifth of my total money kept in savings) or buy something that’s ok and keep a more substantial amount in savings (about a third of my total money). How did you decide?

YABU - prioritise savings
YANBU - prioritise house budget (calling this YANBU since that’s what I’m inclined to do)

OP posts:

Am I being unreasonable?

63 votes. Final results.

POLL
You are being unreasonable
16%
You are NOT being unreasonable
84%
Richie23 · 14/01/2024 21:50

Depends what your savings are for and what you’re comfortable having.
If you’ve been saving up in order to buy a house you’ll love then it makes sense to use most of it for that.
If you don’t like the thought of having very little savings then maybe find somewhere slightly cheaper so you always have X amount in your account. I know some people wouldn’t be comfortable having little to no money in their savings account.
When we bought our house I used all of my savings for the deposit. It was quite a shock to suddenly not have that money any more. But we’ve built our savings up again over the past couple of years anyway.

Choices2024ALevel · 14/01/2024 21:51

I think it depends on the figures tbh.

If you're talking a 5 or 10% deposit on a lower priced house and then you're only going to leave yourself with a couple of grand savings...that's not a great position and would make me nervous.

If your savings are £100k and you'll be leaving yourself with £20k - totally different.

Rollercoaster1920 · 14/01/2024 21:54

You will need some money to fix things that go wrong with the house.

Tangled123 · 14/01/2024 21:54

I had savings but they weren’t specifically for buying a house. I had bought into the whole ‘houses are too expensive’ idea so I didn’t think it would ever be realistic for me. Then I discovered that prices were actually manageable in my area, so we went ahead. We bought at the max of our budget, and our savings were about 7% of the house price. I would have put down all of it, but ending up taking the brokers advice to put down 5% and keep the extra for furniture etc. No regrets.

MNUse · 14/01/2024 21:56

Rollercoaster1920 · 14/01/2024 21:54

You will need some money to fix things that go wrong with the house.

Yep that’s definitely on my list of things to keep savings for. How much would you budget for it?

OP posts:
NewYear24 · 14/01/2024 21:58

£0 all four times, three homes were nee builds so no home renovation budget needed.

EilonwyWithRedGoldHair · 14/01/2024 22:02

Off the top of my head, house was £83,000, deposit £11,000. We kept about £3 or 4,000 in savings.

I'd never have gone down to no savings at all. Was glad we didn't as a year later we had to replace the boiler.

Tryingtokeepcalmandcarryon · 14/01/2024 22:05

Our current house we really stretched ourselves (hopefully forever home) and borrowed a bit from parents and went down to very little in the bank. Uncomfortable and wouldn’t want to do that again (less than 5k, and all sorts of repairs kept coming up constantly it was a mess).

All depends on so many factors. What sort of earners you are, and how long it takes to save and recoup your savings once spent. Eg Are you talking saving 2k a year, or 15k a year? If you spent a bit more could you get a house that needs no work vs saving yourself 10k but then having to spend thousands on it.

I would try to have a rainy day fund for car packing up, unexpected long term illness, boiler breaking etc and if it took me years to save this I wouldn’t go down to the wire when buying a house. If I could save quickly I would be more complacent but still prob wouldn’t go below 10k if possible

(job security also prob pays a part too, if there are any chances of redundancy etc then I wouldn’t want to go too low in savings. Some jobs this is less likely than others)

GreatGateauxsby · 14/01/2024 22:51

Depends on 2 things for me:

  1. your income and outgoings (ie the monthly delta or amount you can save)
  2. what type of property/ where on the ladder you are.


my first flat I didn’t have a penny to my name once it was bought. I had £500 left each month and did something each month or would
wait for 2months and buy something bigger. About 9m in I got a £12k pay rise which was transformative

our second house we knew we’d stay there a long time and went for a 10year fix so it made sense to put down more savings so we had a higher LVT so again we depleted savings but we had a £2-3k excess pm which we used every month for first 6m after moving in then rebuilt savings via the excess and other work promotions (also lockdown reduced our expenditure significantly!)
user1471548941 · 14/01/2024 22:57

We ended up down to nothing and even borrowing some cash from DP’s Mum. We were a fair way into the purchase and Liz Truss happened and the mortgage we were meant to be porting from our old hold hassle free suddenly demanded double the deposit we had committed to. It was worth it though, to keep the low interest rate and we also knew that the house had been recently renovated so prayed for not too many scary finds!

We are however high earns and knew we would have enough disposable income each month to cover most repairs as they cropped up. It was an uncomfortable year but we work in finance so when bonus season came around it sorted what we’d borrowed from family and gave us a small chunk of savings which we’ve continued to add to.

GreyhpundGirl · 15/01/2024 06:59

MNUse · 14/01/2024 21:56

Yep that’s definitely on my list of things to keep savings for. How much would you budget for it?

That depends on the house and what the survey says but less than £5000 is risky, and you also need other savings for a rainy day. My dad always said you should have a minimum of 3 months wages put by for the just in case scenarios.

Youcannotbeseriousreally · 15/01/2024 07:04

In the past zero. Savings do not house children when they are still in money form!!

last time I kept a significant amount but only because I sold alone and brought with a partner. So kept about 50% I have used this for furnishings and a wedding and other stuff since.

Im not one of those people that has to have savings to feel comfortable I’m more about living now.

Papillon23 · 15/01/2024 07:09

I left like 2k after planning for appliances etc, ended up concluding I hated the kitchen, managed to replace that myself for about £1k.

It was tight and nerve wracking but (and this is key) while I didn't want to borrow any money from family, and didn't, I knew if the shit hit the fan and the boiler broke they would bail me out. It would have been temporary and I would have had to pay them back but I wouldn't have been literally stuck without heating or whatever.

I had a pretty decent job and was able to save about £700 a month (over 1/3 of my net salary) once I had moved in, so it wasn't a situation I was stuck in for ages.

Having recently rinsed my savings again (though I still had a lot more than like a grand left!), I am much more anxious about it this time - only you can know how anxious it will make you.

lemondroper · 15/01/2024 07:35

I prioritised being in a home I love - it's only tiny but I am genuinely thrilled every time I come home! Left me with barely any savings, but it's so wonderful after years and years of making do, to finally have somewhere I love.

5th of savings sounds reasonable to me - difficult without knowing numbers but assuming it will cover a few months mortgage at least.

Side note: I hate how every post about money or house buying has to start with an apology!

ChilliPB · 15/01/2024 08:14

We are looking to buy at the moment and this is one of the questions we’re thinking about.

For us the question is about whether to put down a 10% or higher deposit as first time buyers. Either more deposit and less savings left or less deposit and more savings left. We are looking at how much difference putting the extra deposit would make to the products available/monthly repayments. Or for some people it might be about what the extra budget would get you - ie would spending a bit more get your dream house, or not make a massive difference?

We’re also thinking about how much we can save once we have the mortgage. I’d feel more comfortable using most of the savings if the monthly mortgage repayments would allow me a buffer to start saving a decent amount again.

CoffeeMachineNewbie · 15/01/2024 08:17

My decision was made on time available to renovate and he need to pretty much furnish from scratch.

Time and resource.

Kazzyhoward · 15/01/2024 08:19

We did half and half. It was a long time ago, but we'd saved £50k. £25k went as the deposit and the other £25k was held back as we knew we wanted to do work on the house - nothing major like extensions nor roof, but new kitchen/bathroom, redecoration, and a bit of electrical work. Glad we saved back so much as we soon burned through the £25k as everything is more expensive than you imagine and so much "extra" work needed doing that we hadn't realised. We'd never have spent it all on the deposit which would have left us with nothing for the work that needed doing. At the time we pondered a more expensive house and using more of the savings for the deposit (and higher mortgage), but glad we didn't.

TreeStone · 15/01/2024 08:28

FTB? We absolutely emptied out our savings, we were scraping around to buy tins of paint.
If we'd needed anything urgent like a new boiler it would have had to go on a credit card. It did need new kitchen and bathroom but we saved up for them once we'd moved.

Our parents really encouraged us to get the biggest house we could stretch to. Also our previous rent had been more than the mortgage so we had more disposable income after we'd moved.

Startingagainandagain · 15/01/2024 08:48

Thankfully I had some savings left as the house needed a lot of stuffed done (rewiring, new boiler, fix a leak in the toilet, have some of the gutters replaced, kitchen drain repair). I did the painting, remove the carpets and restore the flooring myself but again needed some money to buy supplies.

I still have a little bit saved which is making me nervous so I am saving everything I can to have money if the roof needs work next...

I would say unless you buy a complete new built you need to keep some savings to cover repairs.

It is likely you will find stuff that the survey won't have picked up once you have bought your new home...

ftmpleasebekind · 15/01/2024 08:54

MNUse · 14/01/2024 21:45

Not really an AIBU, and I’m really sorry if the title is annoying/offensive or to some given that house-buying at all let alone house-buying with savings reserved is so hard at the moment. But if you did buy a house and were in a position to reserve some savings as well, how much did you keep for savings vs spending on house budget? Basically looking to buy and wondering whether to try and spend at the top of my budget in order to try and get somewhere I love and could stay a long time in (with say about a fifth of my total money kept in savings) or buy something that’s ok and keep a more substantial amount in savings (about a third of my total money). How did you decide?

YABU - prioritise savings
YANBU - prioritise house budget (calling this YANBU since that’s what I’m inclined to do)

We had around 5k left in savings. Though we had rented before buying so had a lot of furniture, washing machine etc and the house we bought didn't need anything doing to it. So once we had paid the deposit and fees we didn't have anything major to then spend money on.
So it was just an emergency fund.

WonderingAboutBabies · 15/01/2024 08:58

It depends on your financial situation. Is your job secure? Do you have enough coming in each month to cover any emergency repairs i.e. broken boiler, faulty wiring etc? If not, I'd have a little emergency fund saved.

We bought a do-upper 2 bedroom flat with a 29% deposit. We held £15,000 back - £10,000 for new carpeting, electrics, bathroom, radiators, decorating, etc. and £5,000 for emergencies (which we haven't had to use yet phew!!).

kelsaecobbles · 15/01/2024 09:06

2/3 of your cash will buy a reasonable house

Say 200k

Leaving you with 100k savings

Or 4/5 to buy another home - 240 leaving you with 60k

You may spend 20k on moving costs and new home stuff like curtains and dodgy boilers

Leaving you with at least 40k which would be a years salary or more - advice is usually 3 to 6 months

Since moving is say 20k expensive if you would move again from the cheaper home it's barely worth it is it?

Of course if the house prices you are considering are significantly more expensive it might feel different but you would still have tens of thousands saved

NonSequentialRhubarb · 15/01/2024 09:37

We're looking to move at the moment. We have about £100k equity in the house and plan to only put £70k down for the deposit (15%). The rest we're keeping as cash to repay our existing savings that we spend during the moving process.

We're buying a new build so don't need a fund for repairs or renovating, but will probably pay for some upgrades and eventual decorating.

gardenfoundry · 15/01/2024 09:42

IIRC we had about £5k in savings after purchasing the house to help pay for some much-wanted renovations.

Housebuyer37 · 15/01/2024 10:14

Hardly anything but savings don't put a roof over your head. Totally depends on your situation, we needed to buy asap so all our money went into it.

Luckily we have secure jobs so could build up savings again.

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