Active discussions

Meet the Other Phone. Flexible and made to last.

Meet the Other Phone.
Flexible and made to last.

Buy now

Please or to access all these features

Talk
Money matters

Find financial and money-saving discussions including debt and pension chat on our Money forum. If you're looking for ways to make your money to go further, sign up to our Moneysaver emails here.

Original poster

How do people afford nice houses?!

119 replies

Dededot · 09/06/2022 08:01

We have always been extremely careful with money. Bought our first home 4 years ago in quite a cheap area that isn't very nice. It has no communal parking and we never get a space and with number 2 on the way I am desperate to move closer to my parents. We paid £250k for our house, and it's worth £290k now. We still owe £263k.

Between me and DH, we earn £96k a year, but we just cannot afford a nice house in the south. Maximum we could go to is £420k, and then I'd worry about whether it'd be affordable should interests rise to, say, 5%. For that, nowadays you can get very small houses with tiny gardens in the area I want to move to. Have looked at other areas too but seems everywhere is around the same.

I could wait another 5 years when my kids are all at school and I don't have to think about paying £800 a month on childcare, but by then maybe the houses that are 500k now will be 1000k?! Ours is in a bad area so its price isn't increasing in proportion to the nicer areas.

How do normal people afford nice houses when we're in the top 10% earners according to gov stats and can't? Seems everyone I meet has a huge house in a nice area!

OP posts:
Original poster
Dededot · 09/06/2022 08:03

Sorry made a mistake there - we own £163k of our current home**

OP posts:
carefullycourageous · 09/06/2022 08:04

You know the answers to this:


  • - higher salary than you

  • - larger deposit from e.g. family money, inheritance, sale of previous house

  • - more thrifty lifestyle than you


You haven't mentioned what you are spending the rest of your money on - that is the unknown here.

If you overpay for the next five years or so you would have more options in the future. Can you afford to overpay?

Original poster
Dededot · 09/06/2022 08:06

Owe argh I can't type this morning! Equity is £127, and we owe £163* sorry for any confusion!

OP posts:
carefullycourageous · 09/06/2022 08:10

Maximum we could go to is £420k Is this your maximum house price or your maximum mortgage?

Have you spoken to a mortgage broker or is this maximum of £420k based on your view of what you can afford on repayments?

Have you looked at a longer term fixed rate mortgage?

Original poster
Dededot · 09/06/2022 08:11

@carefullycourageous thanks for your reply. We save about £2500 a month at the moment - the rest goes on food and bills (and the occasional family outing). We will overpay as much as we can but because of the area our house price will increase very slowly compared to other areas.

OP posts:
Original poster
Dededot · 09/06/2022 08:13

The 420k is what I think would be the max I'd be willing to buy, to ensure we could afford it in different circumstances or if interest rates suddenly went up. We could borrow a crazy amount but then could be in a real problem if anything changes.

OP posts:
iCorvidae · 09/06/2022 08:14

Dededot · 09/06/2022 08:03

Sorry made a mistake there - we own £163k of our current home**

I was just about to say
We have always been extremely careful with money. ..... We paid £250k for our house, and it's worth £290k now. We still owe £263k.

When you sell your house to buy another one the increase/decrease should be relative

It's the ftbs that need to worry

Afterfire · 09/06/2022 08:15

If you’re saving £2500 a month that’s your answer really. Many people over stretch themselves and don’t save so much, if at all and then if it all goes tits up they manage on credit and then just have to sell. That’s the reality for
a lot of people.

carefullycourageous · 09/06/2022 08:20

Dededot · 09/06/2022 08:11

@carefullycourageous thanks for your reply. We save about £2500 a month at the moment - the rest goes on food and bills (and the occasional family outing). We will overpay as much as we can but because of the area our house price will increase very slowly compared to other areas.

There is your answer - you are saving way more than the average family.

Many people would instead put that money into their equity which is a form of saving (unless house prices bomb). That is how they can afford a more expensive house. You can afford a more expensive house too, it is your personal choices that may be different.

No one can advise you whether to spend more on the mortgage, but you have total freedom of choice about whether to save that £2500/month or pay more off a mortgage (whether this house or another house).

Whinge · 09/06/2022 08:22

Is there a reason why you're saving so much?

ainteasybeingsneezy · 09/06/2022 08:22

I was born in a lovely town in Surrey, all my family still live there or very close by. I moved to Wales when I was younger with a boyfriend, stayed for a decade, and me and my fiancé often look at moving back and it's just completely unrealistic. We have a combined income of £93k so similar to you, but in Wales we have a large four bedroom house, detached, generous front and back gardens, garage, driveway for 3 cars, utility room, fully renovated kitchen and bathrooms. It's in a nice area, leafy and lots of beaches, good schools too. Where we live we are high earners! In the South it would be a very different ball game. If we looked at moving back to Farnham, well, we couldn't! We were finding flats the same price as our house. We tried moving further out and for what we want or anything even slightly close to what we have now we couldn't afford the entire county. We were well out into grotty areas on the outskirts of Southampton or Portsmouth when we started finding prices that weren't (in someone used to wales house prices eyes) absolute insanity. It's all relative of course, but seeing as we aren't interested in proximity to London it's just not worth it for the absolute downgrade in life. I would love to be near my family but they all thought we were insane looking to move up given what we have here. It's not you or your wages, location is everything and to live comfortably in the South, isn't overly easy.

GnomeDePlume · 09/06/2022 08:22

For a friend of DBs it was simply a series of inheritances. Only child of only children with a number of childless older relatives. Essentially a lot of modest homes bought in earlier times funnelled down to one couple.

Pure luck.

Gooseysgirl · 09/06/2022 08:23

In your situation I would go for the small house in nice area, at least you have a chance the value will be better on resale. And go for 5 year fix on mortgage, perhaps with a view to selling on again at that point. We have similar income to you and pa

Mogwaimamma · 09/06/2022 08:23

You are saving more than my monthly salary a month. Most people would just spend that £2500 on the mortgage TBH.

I've also seen people posting on here that houses bought for circa £1 million are effectively treated like rental properties. It is accepted that they will never be able to clear the mortgage. But at least when they need to sell, they will get something back in terms of equity and increase in value.

Mogwaimamma · 09/06/2022 08:27

Also agree with @ainteasybeingsneezy your money goes a lot further depending on location. We live in Wales and our 3 bedroom house is worth £200k. Where my parents live, you could buy a large lovely 4 bedroom semi for £400k

TheYearOfSmallThings · 09/06/2022 08:27

because of the area our house price will increase very slowly compared to other areas.

Not necessarily true. I bought in a cheap and shabby area 20 years ago and now expensive (and shabby). Other people have to make the exact same compromises that you have made, and that in itself changes an area.

So other people in your situation may choose not to move back near their family where they can afford a tiny house, but to stay and buy a bigger house where they are now. Tbh, by having that choice, you are in a position many would envy.

Gooseysgirl · 09/06/2022 08:28

Argh post too soon

Similar income to you and paid £350k around 8 years ago. Now worth £650k and we could not afford to buy it back. Most people buying near us currently are only able to do so because of equity in previous property.

BadAtMaths2 · 09/06/2022 08:31

In your shoes I’d Buy a bigger house in a better area, you are young and saving a lot. Yes it’ll be very tight for a few years but once childcare costs have gone you’ll be ok. And you’ll have likely increased your earnings. You risk being priced out otherwise. You’ll still have savings in your house.

ImplementingTheDennisSystem · 09/06/2022 08:37

We have a nice 4-bed detached house with a garage and off-street parking in a desirable market town (although not in the S.E).
We were low earners but saved a 10% deposit to buy a shabby £116k flat in 2010. We did it up ourselves and sold it 4 years later for £40k more than we paid for it. We then bought the next house - a 2-bed terraced house on a vile street in a dump of an area, in a trendy city for £189k. Again, we did it up ourselves. We sold it 3 years later for £100k more than we paid for it.
We then moved 1 hour away to get a bigger house and took all of that equity with us. The move to a new area was because we have always refused to stretch ourselves with our mortgage. In 2006 we were paying £750 a month to rent our first flat and our mortgage payments now on our 4 bed are only £630!
So, long story short, we can afford a nice house thanks to a hell of a lot of graft, some saviness, some luck and a lot of compromise.

Fleur405 · 09/06/2022 08:40

Saving £2,500 per month is £30,000 per year. That’s approximately the take home pay of someone on, what, 40k? Most people don’t save anywhere near that amount.

Feelingoktoday · 09/06/2022 08:44

You could easily put another £1000 into a mortgage a month and still have savings. Most young people have to stretch themselves for a mortgage and then move upwards.
I live in the south east - you can get nice 3 bed houses here for £450k with good schools. But we are an hour on the train to London.

Hoppinggreen · 09/06/2022 08:46

We live in Yorkshire, earn pretty well and bought our house 20 years ago.
We couldn’t have afforded our house in London and it’s gone up in value so much we would struggle to buy it now, in fact when we bought it we did so just on DH earnings as I owned a flat.
So basically be Northern, Old and a High earner and it’s pretty easy to have a nice house.

Flopisfatteningbingforchristmas · 09/06/2022 08:47

Dededot · 09/06/2022 08:11

@carefullycourageous thanks for your reply. We save about £2500 a month at the moment - the rest goes on food and bills (and the occasional family outing). We will overpay as much as we can but because of the area our house price will increase very slowly compared to other areas.

Why are you saving so much? That’s way more of a rainy day fund. You would be better paying more into a pension or over paying mortgage or moving house if you wanted to.

Notmytiep · 09/06/2022 08:48

ImplementingTheDennisSystem · 09/06/2022 08:37

We have a nice 4-bed detached house with a garage and off-street parking in a desirable market town (although not in the S.E).
We were low earners but saved a 10% deposit to buy a shabby £116k flat in 2010. We did it up ourselves and sold it 4 years later for £40k more than we paid for it. We then bought the next house - a 2-bed terraced house on a vile street in a dump of an area, in a trendy city for £189k. Again, we did it up ourselves. We sold it 3 years later for £100k more than we paid for it.
We then moved 1 hour away to get a bigger house and took all of that equity with us. The move to a new area was because we have always refused to stretch ourselves with our mortgage. In 2006 we were paying £750 a month to rent our first flat and our mortgage payments now on our 4 bed are only £630!
So, long story short, we can afford a nice house thanks to a hell of a lot of graft, some saviness, some luck and a lot of compromise.

I really like this. Well done.

Retrievemysanity · 09/06/2022 08:48

Well there is more than one factor which influences the house people can afford choose to afford.

From what you’ve said, you’re worried about circumstances changing and not being able to afford mortgage repayments but others might not have this concern. Most people I know with massive houses have massive mortgages. If their circumstances should change, they’d sell up and downsize.

But there are other factors too. If you don’t pay for childcare or haven’t been to uni or haven’t had a big wedding etc then you might well have more saved for a deposit than someone on a similar salary who pays for all those things. Plus other factors like inheritance which can all make a difference.