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One more year on lease- should we rent or buy after that?

4 replies

tianquilio · 30/04/2015 13:58

DP and I are currently halfway through a two-year lease which will end next April. We have approximately £30k in savings for a deposit on a house. We are going to buy in Hertfordshire (currently live in London) and the kind of property we would want is likely to cost between 300 and 350k (350 absolute max, prefer around the 300-325 mark).

We will save more over the next year and then are likely to have a decent 10% deposit or a bit more depending on stamp duty etc etc but I keep reading articles saying 10% is not enough and you need 20 or 30% or you get screwed on interest rates.

My question to you is, would it be better for us to move to the area we eventually want to buy in and rent for a few years to save money (I've looked and it would cost us about 800-900 per month, so less than any mortgage) or just buy with a smaller deposit to get a foot on the ladder?

We don't have any DC yet but will be TTC our first in about six months or so. DP would commute to London but I would not - would be a SAHM in all probability but even if I decided not to would not return to work in London.

DP's salary is circa 80k with a good bonus, and will increase in all likelihood (though we will obviously not rely on that when planning financially)

V confused and lots of conflicting advice out there so grateful for any insight or experience from you wise ladies!

OP posts:
roslyndee · 30/04/2015 14:53

anyone out there?

cestlavielife · 30/04/2015 18:01

if you want to buy in herts then go rent there - move to the area you want to eventually buy in to get to know it and try the commute etc. .

foot on ladder is a myth - in five or ten years time you may or may not be in a position to trade up to the next rung. so buy something you really like.

so if you find something you really love on 10% deposit go for it.

otherwise go rent there so you have more time to look.

Chiefbumwiper · 30/04/2015 18:03

Mortgage rates are very good at the moment, I'd buy soon if it was me.

Chiefbumwiper · 30/04/2015 18:05

But consider how w much your wages will allow you to borrow as ten percent deposit doesn't mean they will lend the equivalent of the other 90. Also if you have a baby will you earn less, and dependants do go on the application too. Might be worth thinking house prior to baby in some cases.

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