To get a mortgage or not

[Marie324]

Hello
Looking for some impartial advice what on what to. We are currently renting and family of 5. Our outgoings are very high as we live in SE. Rent is £1900 pcm, food bill is £1000 per month and that's if we are strict, bills come to £1000 per month. We have one disabled child due to this claim £1500 in universal credit per month. My part time salary is 28k and my DH is 49k. We also get DLA of £550 and child benefit of £240 per month. This seems like a huge amount of money coming in but we honestly struggle every month and are in a lot of debt. We have a deposit for a mortgage which has kindly been gifted to us but means we will lose our universal credit allowance making us £1500 worse off a month. My post is basically to ask for advice on whether to take a massive financial risk in order to get a mortgage. The minimum we could get our repayments to is £1600 per month. My employer currently is unable to increase my hours. Any advice welcome. Thank you!

I have to admit I'm not very clued up on the financial side of things. Is global index tracker similar to a stocks and shares ISA?

The AIP was not including any UC but included the DLA and child benefit

AIPs are fairly tight now and affordability is strict. I know very few people who regret buying a home. Assuming you are in private rental at the moment the long term security is comforting. If the gifted deposit is in your accounts you will need to declare for UC and likely to lose it.

The system is broken when you look at the situation you are in of been given £1300pm if you rent but not if you are paying a mortgage. The outgoings are no different if anything higher with mortgage as you are responsible for the whole lot.

Shared ownership is a good option.

A global tracker is a low-cost investment fund that automatically follows the performance of the world's stock markets. It can be held within a pension or a S&S ISA, or general investment account. Many investors utilise such a fund for their pension investments to limit fees and try to maximise its growth potential over the longer term.

(If your current pensions are defined contribution types, what are they invested in? It's always worth checking the investments and the fees - it can make a significant impact on the performance of the pension overall).

They are both NHS pensions

It sounds like you have secure jobs and secure defined benefit pensions.

There's a myth that buying a house as soon as possible, and stretching yourself as much as possible is always the best option. It really isn't. It depends on your individual circumstances. You have subsidised housing, debt, you're considering lowering your disposable income, and have no savings. All risk factors to weigh-up.

Avoid making financial decisions based on bricks-and-mortar FOMO.

Some MNers seem obsessed with global index trackers without necessarily being aware of the downsides.

OP is in the SE which has its own property climate. If she’s in London some properties have risen by 500%+ in 20 years.

How much experience do you have of property investment?

'If she’s in London some properties have risen by 500%+ in 20 years'.

No they haven't. There's no area in London where house prices have risen that much. House prices have risen by 120% in 20 years in London, and in some areas such as Kensington and Chelsea around 125%.
(source: https://business.zoopla.co.uk/20-years-of-house-price-growth ).

I'm well aware of the downsides of Global index trackers. I'm not suggesting that these are the only option for investments. It was simply an easy comparison of property v S&S investments. And the OP asked 'Is global index tracker similar to a Stocks and Shares ISA?'.

In the OP's case the downsides of taking on a mortgage would seem to be a greater imperative to consider carefully, given her financial and housing circumstances.

And yes, I do have considerable experience of investing in both, for many years.

It is not in our accounts and won't be until the point that we are ready to buy (if we do)

Yes these were and still are the concerns that I have. I seem to have had very mixed responses on here and I'm still no more sure which path to go down! I appreciate the time you've taken to provide advice.

Listen to this morning's more or less on r4 - london and SE down 4% consistently since 2022, everywhere else up 4%.

I’m sorry you’re just incorrect, I’m speaking from personal experience. You can’t learn that kind of thing from Google. K&C actually have lower growth % than other areas as prices were already high.

I was talking long term. London and SE pricing is already significantly higher than the rest of the country, excluding certain pockets.

Prices are currently stalled so it’s a good time to buy.

So your personal experience is more accurate than the research data? 😕.

Ok... in your personal experience, which areas of London have seen house price capital gains of 500%+ in the last 20 years?

Shared ownership is good in your circumstances because you can make the down payment and a small mortgage then rent the rest which means you can still claim uc

Where I live in London 20 years ago houses were £100k and now they’re £600k. I do agree with most of your posts @ZiggandZagg but my experience is the same as @Aluna, and prices now stalled since Cost of Living crisis. My caution comes from being a FTB at the pre-Brexit peak, trying to sell a starter home during a pandemic when everyone wanted a home office and living space, then buying a family home well within my affordability only for that to be blown out the water with the Cost of Living crisis when water bill quadrupled, council tax, mortgage, energy, nursery feed and food bill went up. The growth of bricks and mortar value 2000-2016 is not matched by 2016-2026. We’re a family with young kids and getting by, and maybe in 20 years time I’ll be saying the same as others that it’s worth it. But I had the headroom over the past 10 years and it’s been really stretched. @Marie324 as you can see lots of different experiences and perspectives here! I couldn’t do the diy on my windows a PP suggested.

I do not wish to be argumentative, but the Land Registry data shows the cheapest property sold in 2006 (20 years ago) in the Greater London area was a flat in Beechcroft Court, Sydenham Hill, Greenwich for £107K.

Rightmove estimates its current value at £240K. An increase of 140%.

I'm happy to be corrected if anyone can show me data of an actual property in the London area that has increased in capital value in the last 20 years by 500%+.

Use Houseprices.io to look at a road with three bed houses. Pick any from Google along the north south circular road on Overground line or Elizabeth line. You won’t see it in the history of one house, as people stay in these houses as family homes for 30-50 years. But you can see the equivalent houses sell over that time.

Exactly 100k > 5/600k; 200k > 1 million; 300k > 1.5 million etc. It’s not universal, there’s a range from say 100-200% - 600%.

Sydenham Hill is not in Greenwich, it’s Southwark/Lewisham. And those are comparatively cheap areas of London.

Look at the houses. Take Greenwich. Example: Gloucester Circus 1996: 325k > 2020: 2.6m.

I bought a house in Clapham in early 2000s for 200k and sold it 20 years later for 1.2m. I bought a house in Wandsworth around 2000 for 480k, recently sold for 2.5m.

You can't afford to buy. Your net income with wages and benefits is really good and you have said rent, food and bills come to just under £4k.
Yet you have no money and have debt. No way can you afford a mortgage without that UC payment

None of these examples show the capital gain within the last 20 years.... and 1995/96 were the start of the boom housing years following a severe recession and a crash in property prices, (which was particularly acute in London and the South East)...

Clapham and Wandsworth examples were 2004 and 2005 - so yes last 20 years. And those are random examples of a broader pattern.

The Greenwich house was to show you the kind of increase seen across London property, in an area you thought you had given an example of. (A cheap flat in Sydenham is not a good marker). Of course it’s over a longer timeframe but the the increase was 700%.

The nearest sold properties I can find that matches your dates and price range in Clapham are:

-a basement flat in Salcott Road. Bought in Sept 2005 for £318K and sold in October 2025 for £840K. A rise of 164% in 20 years.

-a 2 bed flat in Macaulay Court, Macaulay Road, bought in 2004 for £225K and sold in 2025 for £410K - a rise of 82%

-a 3-bed semi in Tasman Road, Bought in 2002 for £318K and sold for £840K in 2025 - a rise of 164%

The nearest sold properties I can find that matches your dates and price range in Wandsworth are:

-a 2 bed flat in Eastfields Ave, bought in 2004 for 472K and sold in 2025 for £675K - a rise of 42% (so below the rate of inflation increase).

-a 4-bed terraced in Wellington Road, Wimbledon Park, bought for £522K in 2007 and sold in 2025 for £1.196M - a rise of 129%.

None of these are anywhere close to the capital appreciation of 700% you claim.

Can you provide any concrete evidence of a property that has shown a capital appreciation of 500%+ in the past 20 years - excluding those that have had a significant extension and upgrade?

https://www.rightmove.co.uk/house-prices/wandsworth.html

Here you go - the first random two that I came across, bought 20 years ago in 2006.

A 4-bed semi in Goldsmith Road, Acton W3 6PX
Bought for £440K in 2006, sold 2024 for £824, current estimate £988K - an increase of 125%.
https://www.rightmove.co.uk/house-prices/acton.html?propertyType=SEMI_DETACHED&pageNumber=3

A 3-bed semi in Grove Place W3 6AS,
Bought 2006 for £410K, sold 2024 for £967K , current estimate of £988K - an increase of 141%

www.rightmove.co.uk/house-prices/acton.html?propertyType=SEMI_DETACHED&pageNumber=3

Can anyone substantiate claims of 500%+ increase in price for a London property in the last 20 years ???