Did you put every last penny into your deposit?

[user3274826]

If you saved the deposit yourself, not had a gift from family. How much money did you leave as emergency after deposit? Or did you not have any back up savings left?

@Notyetthere we saved a lot of money over the course of 11 years, but the house deposit we really focused on for about 5 years. We were in rented which was far cheaper than mortgage so that helped. DH put a certain amount away as soon as he got paid, and I put what I had left each month in to savings. I did top up the pot with half of my redundancy money, and half the money I was paid out after a non fault motorbike accident, but the majority of it was savings.

Thanks for everyone's experience, helps me figure things out.

Our situation is, we are planning on buying in an extremely affordable area. We are planning on buying in this cheap area and borrowing less than half of what we could potentially borrow, mortgage wise, so we have more disposable income and to keep emergency money situations less stressful all round. At least for the next 5 years when we'd think about moving to a more expensive area in time for the DC to start secondary school. We already have all our own furniture. Our jobs are secure, but if an imaginary scenario occured where one of us lost their job (not putting anything past my imagination after the current pandemic) then the other could afford the mortgage by doing overtime, and the other would find emergency minimum wage work easily, and minimum wage would be enough to pay the low cost mortgage. Isn't there interest only options available for emergencies too?

We wouldn't buy a house that needed obvious major work doing unless we had saved in advance for that scenario. In the unlikely event the boiler broke the first week we moved in, then we could live without it until pay day, when we'd have enough to buy a budget one or spread the cost of a more expensive one.

It just doesn't make much sense to me to keep saving another year or two or three like others have said they did to have a bigger deposit plus emergency savings, when in that time we would be wasting thousands in rent. Wouldn't it be best to buy as cheap as possible as soon as possible, and have all that rent money in equity?

An I really being particularly risk averse, or is my plan less risky when mortgage payments would be low? We could save an emergency fund much more quickly if we weren't paying rent so the only risky time would be very short term.

I haven't made any decisions yet, but like to work out all scenarios.

Just another thought, a friend had major emergency involving major flooding and electrics shortly after buying a house, and their insurance covered everything. So I can't imagine every emergency scenario would leave us in a position where the house would be repossessed if we didn't have the money immediately. There are other ways around emergencies surely, be that insurance, loans, paying in installments.

Current house we put down 10% deposit and kept back £25k for fees and renovations

Kept a small amount as back up in savings

Our first place we only put down £5K (was 2008 and just before the crash 😭) and kept bk £25K for renovations. We did spend about £18-£20K on renovations. I wish we had put down £10K but I suppose we kept some for emergencies in case we became unemployed etc.

Second place we put down £60K we kept bk £35K. I wanted to put down more dh didn't agree and we decided we cld put more down at a later date. We have done renovations, pretty much done now, savings went down to about £10L but bk at £20K so I wish we had maybe put a little more down. Garage going to get converted though now that we have more savings.

I would never put all money in to a deposit. Even if place was exactly as I wanted and I had furniture etc. I wld always keep some savings, about £5K min. Especially now with the big recession we are entering.

Saved enough for deposit, all fees & moving costs

Had zero furniture when moved in. So slept on floor in sleeping bag. I remember it snowed. Cardboard box as a table. All furniture & curtains were bought over the next few months, as money became available

I don’t know whether a mistake might be looking at this as only a 5 year purchase at the moment. I’m no expert but the current view is that house prices will fall. What you don’t want is to but, lose loads of value, then find you can’t move to the better area when you need to for school.

But then I agree you’ll just spend it on rent otherwise.

It’s a tricky one. Maybe take some professional advice?

We are looking to move again now but only cos we know it is our last move so we’re ok if value drops as we’re looking 30 years plus

I spent all bar about £2k, but that includes budgeting for legal fees, new cooker etc, so it was £2k left in savings.

Moved in, realised I couldn't cope with the kitchen for long and spent £600 in B and Q to replace all the cupboards etc. Dad and I even reused the old hinges where we could to save money.

It was risky, but I had a stable job and could save up about 1/3-1/2 my income (500-750) if necessary. I figured I could pay my mortgage on a minimum wage job if I had to. My car died 8 months later and I'd actually saved up about 5k more by then, even with paying for house repairs etc, so was able to get myself a nicer car.

I had good credit though, so if the boiler had died or whatever I could have just put it on a credit card until I could pay it off. I never have things on credit cards but they make a good emergency option if necessary.

Moved to new location
Old banger car died the second day of my new job
Bought another old banger with emergency savings !

I put down about 5k more than planned leaving me with very little after all the purchasing costs. However this meant I had 85%LTV mortgage instead of a 90% one, which meant my monthly repayments reduced from about £750 to £450-£500. This saving was enough to then afford credit (or to borrow and pay back to family) a bit of money for furniture etc and left me better off before long.
If paying more decreases your interest rate, then do it; you can always use credit for genuine emergencies. However buying now might come before a drop in the market so saving for another year might not be a bad plan. Rent might be wasted money but so is unnecessarily high interest or overpaying.

It honestly depends on your situation. For us, moving to a low cost area = crime where we live in the SE and wasn't prepared to live like that. We spent years in rented, but had houses fall through in that time so were actively trying to move. Doesn't mean we went without, we got married, DH has bought cars, I got a car (all outright), motorbikes, holidays etc. All paid for by us. Just every time we had bad luck with the house, we cracked on with the saving whilst trying to find a new one because we'd be in a better position when we did.

My first house at 19 went wrong at every level, so many problems. I swore I'd never be in that position again if I could help it.

Those of you saying you kept back 30/25/40k or whatever - how? Was this when you were FTB? These seem like huge, unattainable sums To me.

We’ve just bought our first flat in Feb. We’re in London and huge rent meant we had a small deposit. Of course every single penny has gone into buying this place. And it wasn’t even a lot of money - less than 20k. We don’t have the luxury of keeping 3 or 6 months mortgage repayments aside - it’s completely unrealistic! The truth of the matter is our mortgage repayment is very similar to what our rent was, so it was a no brainer to buy instead of continuing renting but that doesn’t mean it aaa a huge deal. We had to throw everything we had at getting it.

I’m in the final stage of purchasing my first home in Greater London. We were originally going to put down a 10% deposit but later decided to up this to 15%. After everything has been paid, including solicitor, I’ll have about 15k left. I’m risk adverse and need the security of having money in the bank. I don’t think I would want to be left with less than 10k though, just in case something went wrong. I have gone 50/50 with OH but he’ll have substantially less, about 5k and he’s ok with that.

@GorgeousLadyofWrestling
I only kept back money on subsequent purchases

First time I had just enough for deposit and fees and then bought necessities from ikea and Argos and accepted hand me downs for the rest which I eventually saved and replaced for my own taste over the following years

@GorgeousLadyofWrestling yes FTB at ages 35 and 38 (first house at 19 didn't count) so we are quite old in comparison to most people who bought a house.
We had a few holidays and bought some things as above, but on the whole we lived what would be a frugal life. We rarely ate out, if I needed something and didn't have the money I wouldn't get it, I didn't spend money unnecessarily or on stuff I didn't need. I have an admin job in the city, DH is an engineer but wasn't always and had a shed load of debt when I met him so we aren't high earners. I've always been a saver, grew up poor, almost destitute.

I think saving for 11 years and having a huge deposit and extra in the mean time, paying rent in all that time and living frugally doesn't sound like the most financially savvy thing to do personally. For someone who says they grew up almost destitute, it seems strange to me you wouldn't compromise and buy in a more affordable area sooner. Deprived areas arent as awful as people assume, most of it is snobbery. Yes, crime rate is high where we are looking at buying, but I've lived here for 15 years already and nothing has affected me directly. The only concern in my plan, is we may struggle to sell if we want to move on in less than 10 years.

We used every single penny and even raided the DC's savings (we paid it back)

@user3274826 we couldn't afford to buy 11 years ago. We were renting off a housing association. DH had a load of debt, it was my admin wage paying most of the bills. We cleared the debt and started to save to move, however living in the south east, close links to London, the rent was half the cost of a mortgage.
The deprived areas here are bad and there's a reason why people don't want to live there and it's hard to get out if you did buy. As time went on, the building we were living in went downhill and we couldn't even get a swap.
I regret not buying years ago, but we didn't have the money. Do you know what it's like not being able to pay bills, worrying about putting food on the table, clothes on your back? That was my childhood. It may seem strange to you, but I couldn't go back to living wage to wage just to get on the property ladder.

@OneRingToRuleThemAll Keen to know whether you purchased pre or post recession?

OP we did exactly the same as you a year ago and have no regrets, we had a small deposit (5%) and bought a house way below our affordability, we didn’t see the point in saving for another few years and wasting money on rent to afford a larger house or one in a better area (our area is not known as “nice”, but our street is lovely and we’ve had no issues at all living here), so spent every last penny (even borrowing from my parents to cover fees) to buy our house. We both have secure jobs and have a lot of money left over at the end of the month that we plough into the house as it was the cheapest on the street because it needed a full renovation (structurally sound, but very dated).
It’s worked out great for us, I feel safe knowing that if an emergency happened we have enough money at the end of each month to pay for it. Or that if interest rates go up we can afford the mortgage comfortably. I don’t regret buying earlier and not renting and saving for longer at all.

No, we put a quarter of our savings down as a deposit. We could have afforded a bigger property, but went with one which fit our needs rather than go in on the dream house just yet.

We’ve not touched the rest of our savings, but are saving each month for furniture, decorating, landscaping etc.

@Neron, I was just going off what you said in your first reply, that you'd been saving money to buy for 11 years. Your latest reply says differently, so if at that point you were actually paying off debts not leaving money sat in an account then that is a different situation entirely. To have 60k leftover after buying is huge to me though, I could buy a 3 bedroom maybe a 4 bedroom house here for 100k. So it really wouldn't make sense for me to save that much alongside paying rent, so a lot of our differences are location based. If my rent was going to be significantly cheaper than a mortgage I would be inclined to save for longer and have a bigger emergency pot, certainly. But still not that much extra.

That is exactly what I was thinking of doing @Elsiebear90 glad to find someone else who doesn't think it's totally reckless. I think it really depends on how much you are prepared to spend on a mortgage. I'd rather have the disposable income and use our rent savings as equity to eventually move to a nicer area, although, I'm very much accustomed to the not nice area now, so maybe I'd always prefer the extra disposable income and a shorter term mortgage.

No I said we saved a lot over 11 years, but focused on the house deposit over 5 years. Original question was if you put it all as a deposit, then tried to answer answer about how long it took so didn't really explain more until the other replies. Sadly 100k here wouldn't buy much.

Don't get me wrong, we were trying hard to move out, just had a load of bad luck. Each time we were thinking save a bit harder and see what we could get. Like if we were looking at terrace and a purchase fell through, how much would we need to save to buy a semi, then a detached etc. I do wish we had been able to buy earlier in our relationship, or had thought sod saving more so we could move away from the bad neighbours earlier for our mental health. On the other hand, the only way we could have afforded for DH and I to go back to college was by staying put with the cheap rent and saving whilst putting up with what we did. Bit like you moving to the cheaper area to get started I guess.

I definitely wouldn't put every penny down as a deposit, I'm in the process of buying about to complete next week and will have £5000 left after legal fees and buying most of the things we need, we will still some things we need to buy but not more than £1000. It might take you a bit longer to save but surely it's the most sensible thing to do, you don't know what might crop up that you need the money for.

If your house needs renovation (ours doesn't) then obviously you'll probably need to keep more aside.