Tell me how you got the first step on the housing ladder .

[Mollymarvelous70]

The pressure to get on the housing market has just been getting me down recently and I’m losing motivation.

DH and I have reasonable paying jobs but we just can’t seem to save enough to get on the housing ladder in the south east whilst living comfortably. In the past 2 years we’ve saved about 8k sat in Lisa’s but it just feels like such a slog to get anywhere near what we need. I did make the mistake of posting on Money Saving Expert a while ago for budgeting advice but got ripped apart for our level of earnings and lack of ability to save which made me feel a bit embarrassed tbh. Some people are really struggling and I realised that i didn’t want to penny pinch to the extremes and receive the critical judgement lots of people on their face But equally I do want to move forward.

We earn about 45k ish each but outgoings are high due to area mans student loans.

I wondered how many had to save for their deposit and how long it took them. Did you have any crafty or innovative ways you got the money together so you could just get going ?

Just interested to hear others experience really for some motivation.

@Ragwort yep I’ve been enjoying it.. I was very frugal as a student and had a full time job alongside my studies etc but over time I’ve let that slide.

DH is always supportive and we consult on everything money .By pressure I mean that we couldn’t cover outgoings on one salary so I wanted us to save to make sure my half is always covered and it’s not a worry . Job is stable.

@wornoutmama1 thank you. Yes we can’t go uninhabitable right now but certainly need to rethink my aversion to ‘penny pinching’

This was early 80s
We had our 9-5 job which even with the multiples and 100% mortgages it wasn’t enough to buy in the area.
We took 1 year to save the substantial difference.
We kept our jobs, we then worked behind bars, we stacked shelves etc. We went from job to job.
I would leave work at 5 and at 5.30 be behind a bar pulling pints till 10.30pm.

It was exhausting but we got the cheapest, tiniest , grottiest studio flat

@AteAllTheAfterEights wow that is impressive. Do it like the look of stamp duty!!

@Desiringonlychild that’s also hugely impressive . The numbers we need seem less daunting when others like you have done it twice over and on less coming in . We will have childcare which makes a difference but with time it’s possible. I appreciate the insight into how you manage and budget. Since lockdown I’ve stopped wearing make up all together and feel fine . Maybe I’ll have a foundation and line /mascara but the rest of my stuff I haven’t used. I normally would buy clothes and shoes but other than some T-shirt’s and leggings from H&M I’ve not bothered. You seem to have a good balance going on !

@Indecisivelurcher okay that’s defo something I need to adjust . I don’t have many / any friends with kids locally so need to make some otherwise I am at risk of doing expensive activities to fill the time ...

@Oliversmumsarmy great getting it done pre kids ! I trust you’ve moved onwards and upwards since then.. starting early and getting anything / something to get going seems to be the key for many people. Thanks

@Mollymarvelous70 'starter home' is such a strange concept in a way. It usually refers to a 2 bed flat or house which most people feel that young families would grow out of, but a lot of renters do stay in that sort of homes for years as most people in London at least don't rent houses.

if you own you are paying off equity so its kinda like a forced savings plan. The more equity you pay off, the more likely you are to move. Its true, the gaps between each rung are huge- around £300k in London but there is a chance esp now that there is a property market crash and as long as you overpay and are not in negative equity, that would make it easier for you to trade up. You can also move further out later in your life when that is more viable ( moving further out in your 40s is very different to moving further out in your 20s).

Everyone says moving costs are very high. Even if you buy a £800k second stepper house, I estimated that pre stamp duty cut this would cost £30-40k (generously). Over the course of 5-10 years (which is usually how long it takes to move anyway), you only need to save at most 4k a year for this. Very few people can get their ideal house in their 20s and early 30s.

@Desiringonlychild

Where do you get those numbers from lol

According to Land Registry, the average terraced house in London costs 500k and the average flat c 400k.

In my (cheap) part of London, I’d say the price difference between a 2-bed flat and a 3-bed house with parking and good garden is about 150-200k.

The market was booming yes, but we didn't really benefit due to the improvements we made on the flats we were in. We made profits each time we sold but not market booming profits. Maybe £5k or £10k? Nothing like others who were making £50k/£60k.

In fact we suffered due to the market booming which lead to us being in negative equity from 2007 until 2015. Might even go back into negative equity now

I have my spending weaknesses. I love gadgets - specifically Apple gadgets. It's about the only thing I spend on though (no clothes, make up, shoes, jewellery, handbags, magazines, books etc etc etc). So I save up. Use 0% credit and buy second hand.

I didn't buy a pram. I bought a lie flat buggy. Only used that. For 2 DC. Saved me having to buy a buggy.

There's loads of saving money/debt free accounts on insta. It's a lifestyle choice I think to actively save as much as you can.

I hope someone like you but 5 years behind you sees this thread too.

I'm saving for my children now and have started a pension for them both too. Hope we can encourage them to make good choices when they are older.

Also buying small (we're still too small now!) isn't a bad thing.

Don't think of it as being stuck, think of it as being safe.

There's lots of ways to make a small space work for you.

You could easily stay in a one bedroom flat with 2 children...if you had to. It's not ideal, but you'd get on the housing ladder pretty quickly if you thought like that.

@JoJoSM2

This is my area, www.rightmove.co.uk/house-prices/n2.html

In my area its more like £400k. I think most second steppers move out to Finchley, High Barnet and Hampstead Garden Suburb (there are some little cottages) though.
www.homewardlegal.co.uk/blogs/second-steppers-need-average-75k-climb-property-ladder

In London, the average price differential for second steppers is £343,134. Oxford and Cambridge are also among the cities where second steppers face a huge financial leap to climb up the property ladder, according to the House Simple research.

My plan is to move further in to zone 2 and get a 3 bed flat as I think post covid, prices would fall further. I saw a 3 bed flat in Kensington (can accomodate a family of 3) for £850k, same price as a terraced house in my area. I think the cost of that flat would fall much more than a house in N2 and that would make it easier to move. That wwas how I got my flat in N2, I bought in an area that most first time buyers and families were eschewing as they thought it was expensive. Property investors were also not investing due to BTL rules, Brexit and Corbyn. Hence prices in my area fell by 15% from 2015. I think Kensington and other expensive areas will fall even more from hereon.

Sold a car for a deposit on a doer upper in a cheap town and moved from SE to midlands. Highly recommend it

@Desiringonlychild

Yep, North London is pricier and the areas closer in are particularly expensive.
I also expect prime London prices to fall further down as rental yields are pants.

I’m in outermost S/SW London, literally walking distance to the countryside, and the prices are about 325-350k for a 2-bed flat, rising to 500k-ish for a 3-bed house. 800k gets a lovely 5 bed with a large garden.

My parents grew up in dire poverty, like something out of a Dickens novel. My mum used to tell us stories about her childhood and we thought she was joking or exaggerating, she wasn't. What she says though is that although life was very tough, everyone else they knew was living the same way, there was no comparing with richer people because they simply didn't know any.

When I was growing up we were poor but not dire poverty poor. However, I was very much aware of richer children at school having the latest brands, going on holidays abroad, living in huge houses.

With that in mind I think it is generational, peer pressure has increased massively over the last few decades.

If you're surrounded by people with nothing you don't know any different. Nowadays you can't help but be aware because of social media etc.
So you're earning a good wage but that also means you might be mixing with people also earning a good wage, it's "keeping up with the Jones's " but in a very subtle way.
The issue is if you assume everyone else must have had an inheritance and combine that with "I deserve..." then you're going to find it difficult to change your mindset.

We've saved up a healthy deposit, but are looking to move back up north from the SE, because we don't earn enough to get a house down here.
This is how we saved up the deposit on about 45k a year between us.
Shopped in Aldi, made meals from scratch, mainly vegetarian meals although DP occasionally eats meat, brought EVERYTHING secondhand (eBay is our best friend), very few meals out, we don't drink hardly, both of us on DP car insurance, lucky because DP is a former mechanic so both have nice secondhand cars he maintains, Dd dresses in clothing bundles from eBay, days out bag of chips on the pier and a go on the two pee arcade machines, handy Mil for childcare, I've grown my hair so i don't need the hairdressers and we've learnt of YouTube to do DPs and DD.
Although we despaired at times, we've on the whole had a really good few years living like this, with a LOT of laughter.
Obviously some of these won't be possible for OP, but I hope some of it is useful

@Mollymarvelous70 we’re in Scotland, I believe stamp duty/Lbtt is lower in England

I know you said your jobs are south east based but would it be a possibility to move to cheaper places even if it means taking a pay cut? Two 30k jobs would take you a long way in the North.

I'm going a bit against the grain here. We bought our first (and probably last) house in our late thirties outside London five years ago. Before that we were renting in a really nice part of London and lived in an amazing riverside flat with our two young kids. We could never afford to buy a big enough place there but took advantage of everything London had to offer. We spent weekends visiting places that we liked, would work geographically and had good schools. It took a year (!) of hunting in our preferred town to find a house. We had a 10% deposit and bought a solid house with dodgy decor. Yes, we could have bought a small flat in London at some point and made a profit which would have increased our budget, but our quality of life renting in London was really good. Our house here isn't massive but it's definitely big enough and I love the town and having countryside on our doorstep. We found renting with kids bought us time to really figure out where we wanted to be long term.

Shared ownership house 30% share when we were very young then progressed to 50% then sold and ‘properly’ bought a house

First house in 2005 with a 5% deposit - cheap 2-bed terrace in a crap part of town. Planned to live there for 2 years and almost stuck to that. I renovated kitchen myself and made enough to move in early 2008. About to move to area I want to be and will be mortgage free at 45. Overpaid mortgage and saved £25,000. In the north so prices are reasonable.

Oh yes hairdressers! For a long time, I couldn't afford haircuts. So grew my hair long. I just cut my hair and paid £25 to the Chinese hairdresser at Soho.

Not sure where you live but London has a lot of cheap options.25% of families in London live in poverty, these people need to go somewhere. And in London unless you live in Knightsbridge or Hampstead, there are always local cheap options so you don't compromise too much on quality of life..a lot of people in London pay so much for gyms but there are cheap chain gyms too- all the machines are the same, if you don't exercise, it's not because you go to.the cheap gym, it's because you don't want to exercise. Or you can just go running outdoors..

For a long time I only had 1 pair of shoes-£30 Clarks leather shoes. I wore this daily until it died on me. I have upgraded now- I have a pair of boots and 3 pairs of heels. All cost less than £30. But yes 1 pair of shoes, 1 coat, 1 scarf, 1 pair of gloves. Everything else can go. I used to walk 3 miles to save £1.50 on the bus..

No cinema now but we used to only go to the cinema with £6.50 tickets. Sneak our own food in..our nice meal out was McDonald's/Wetherspoons. In even poorer times, my husband used to batch cook curry and we would eat that the whole week. Actually I still have a lot of these habits now, once you have them, it sticks. But it does have to be sustainable .no use doing Dave Ramsey and then going nuts when you walk past space nk or Hobbs sale.

Curious as to why your rent/bills amounts to £2.5k. Seems very high

With rent of £1,300 + 200 council tax + utilities and then repaying debts with interest £2,500 is believable.

I was in the South East but bought straight out of uni so never rented first.
I had a small inheritance and saved like mad for 18 months living at parents for free to get 10% deposit. I then lived on beans for the first couple of years as my mortgage and bills were my whole salary.

I think once you are in the rental trap you are doomed really. It’ll be even harder once you have a child. Sorry, I know that’s hard to hear!

We lived in a crappy flat and saved, but the most significant thing was being given £5k for a deposit which back in late 1998 was enough for us to put down a 5% deposit and pay our fees in a nicer bit of a not so nice area of north London. So for us, luck, really.

Thanks @Megan2018 hopefully not doomed at least I can continue to save and slowly.

@Smallgoon @SinisterBumFacedCat I didn’t really want I open up all my outgoings for scrutiny because that wasn’t really the point for me . It is all allocated but we can do better. Includes things like hello fresh , expensive phone contracts etc etc plus a buffer for emergencies

Op When you get into it saving is really satisfying. Especially if you think of it as 'paying yourself.' Why not set up a bank account for your baby now, start depositing £100 a month so when you progress from pram to new shoes the money is there waiting. I also started meeting friends for breakfast rather than dinner. No wine and generally it's much, much cheaper. I hope it goes well for you op. Make your money work for you, don't use it to line other people's pockets.