Buying a Flat in London - Hold Off?

[rillette]

DH and I have been looking for a 2 bed flat in SE London since April. We offered on one last year but the vendor was awkward - didn't respond to our offer for months, was waiting to see what the market did. Eventually came back to us but by that point our heart wasn't in it (and I'd joined the resident's facebook group of the block and read all the horror stories of crime/loud noise etc).

The flat next door to where we currently rent is for sale. This is only a 1 bed, so limits how long we could stay there (hoping to have a baby in the next 2-3 years), but we may be able to get it at a great price. We have lived where we are for 4 years, it's a resident-run management company, peaceful, never any issues with crime, parking spaces aplenty, etc. It seems a great opportunity as we could make the changes we would like to in this current flat (get a dishwasher, storage solutions etc). We're also conscious that if the right thing doesn't come up, we will probably end up still in this flat paying rent, and the mortgage for the flat next door would be less! We'd also have lots left over as it would be a smaller deposit than for the 2 beds we were considering, so we could keep on saving for our next upgrade. On the other hand, I don't want to end up kicking myself if the market does drop and we could have snapped up a nice 2 bed flat within our budget. The prices of current/next door flat have certainly already softened by about 20-30k since the 2018 boom.

Would really appreciate some MN wisdom! I realise no-one can predict what the market will do but any thoughts welcome.

Zone 2 SE London here, flat with a garden. It's not a rare thing.

OP, I'd stay put if I were you. Enjoy what you have, save for something that's "family-proof". My first flat was a large two-bed in the catchment of a good school. We moved on but our onward search was much less pressured because in practice we could have stayed there another decade.

Lots of two up to downs between woolwich and abbey wood crossrail stations. Would have a good look. By the time we are working from offices again it must be getting close!

@Spidey66 I am in East Finchley. A lot of young families in my area living in flats!Some of the larger flats are actually bigger than the smaller terraced houses (which are the only ones not up for in excess of £1 million) so actually might make more sense to get a big flat (esp with garden) rather than a house. Esp now leasehold is being reformed so that there is a right to extend for 990 years. with this development, some freeholders may even be quite game to sell the freehold now that the profit margins have gone down as they are not allowed to charge for marriage value anymore.

OP should check firstly for cladding and secondly whether ex LA flats are included in the reforms.

Personally I’d wait. It’s predicted that house prices in London will drop this year. People are re-assessing where they want to live with remote working looking likely to become a longer term thing.

@onlychildandhamster, properties like those in the pic are often purpose built Edwardian maisonettes. The clue is in the 2 adjacent front doors - they were never conversions.

They often have their own small private garden, too - a big plus IMO.
Also ground rent/maintenance charges are likely to be relatively very low.
I looked at a lot of these with a dd when she was looking to buy in SW17. IMO they’re a much better buy than a standard block or conversion flat.

@GETTINGLIKEMYMOTHER I think I got put off because a family friend who lives in one of these had an absolutely insane neighbour/fellow leaseholder. They even went to court over the maintenance.

And he told me that if you have only 1 fellow leaseholder who is insane, that would make your life a misery. but 30 other fellow leaseholders in a resident managed block are unlikely to all be insane. DH is a director of our management company, and everyone seems reasonable so far. But i do agree that I would be looking at one of these for my next property as they are more likely to have 3 bedrooms.

They are indeed lovely properties, though the first floor is slightly bigger as their front rooms are over the staircase if that makes sense.....when you go in their front door the stairs are in front of you an the living room upstairs will be over the downstairs living room and the porch. Plus having the roof space is handy and many in our area have extended into the roof space. Unfortunately, we're on the ground floor so don't have that luxury.

The upstairs flat also has stairs to the rear going to their back yard (where I am now anyway).

We moved there 1995 after getting married-we had hoped for kids but they didn't happen so as a result never really needed a bigger property, and liked the flat and the area. When we bought, prices in London were still affordable(ish) and we couldn't afford it now.

There is a ground rent but that's a whole different story attached to ours which is far to long and complex to go into here. But because there's no communal areas, there's no service charges like you'd get in a block.

Yes, many of the ones we looked at had stairs from the upstairs kitchen to a nice little back yard or garden. The layout of some was better than others - with a good size bathroom there from the word go. The one that was eventually bought (built 1905 and in a right old state) still had the remains of the original gas geyser in there! But it’s been turned into a very nice 2 bed property.

They must all have been originally built to rent out - AFAIK mortgages weren’t at all easily available until the 1920s.

I wouldn't buy the 1 bed in your current block.

To be honest, this is the easy option, but doesn't tick the long term boxes and you will probably regret it. If that flat was elsewhere, you wouldn't look at it....so don't seriously consider this one.

The reality is, it will only last you a short time and then you will face the costs of moving again and the struggles of selling a 1 bed. It would be better get something that will last you longer - you need to picture your life in 5 years or more and perhaps with 2 kids.

You're weary because the other flat didn't come off and this seems an easy and safe option, but you really need to summon the energy to continue the search and accept it might take a bit longer. You will be glad in the longer term.

And you very much sound as if you're trying to talk yourself into the 1 bed - emphasising the points about the management company and parking....yes, they are pros, but they don't outweigh the very big con of it being 1 bed. Keep your eyes wide open to the things that really matter.

Even decades ago my DM used to say that moving could easily cost £10k just in fees, tax, new curtains etc., so I wouldn’t think a move ‘just for a while’ is advisable unless money isn’t going to be an issue.

Something like this? My sister lived on this road for a while, it's off the high street but still quiet and it's very good for transport. Like a PP said, first floor but has direct private garden access.

We bought a period 1 bed flat, Zone 2 SE London. It is 1 of 4 flats in a converted villa and was big enough to be reconfigured to a 2 bed. We have a large private garden too. It involved doing structural work and has been stressful but it's certainly do-able. We have a toddler too.

@Meandyouandyouandme

I’m currently in a two bed flat but it was bought as a one bed. It had a separate kitchen that was big enough to turn into a second bedroom, and we made the large lounge into a kitchen/diner/lounge area. A possible option for any other one beds you view maybe.

This is pretty much what we did by removing a hallway.

[quote onlychildandhamster]@Spidey66 I am in East Finchley. A lot of young families in my area living in flats!Some of the larger flats are actually bigger than the smaller terraced houses (which are the only ones not up for in excess of £1 million) so actually might make more sense to get a big flat (esp with garden) rather than a house. Esp now leasehold is being reformed so that there is a right to extend for 990 years. with this development, some freeholders may even be quite game to sell the freehold now that the profit margins have gone down as they are not allowed to charge for marriage value anymore.

OP should check firstly for cladding and secondly whether ex LA flats are included in the reforms.[/quote]
onlychildandhamster - I didn't know leasehold reforms had been given the go-ahead yet, and that marriage value is def. being abolished. Apparently this is still in flux and Martin Lewis's MoneySavingExpert website only last week said the plans could take a few years to become law. If you know otherwise, I'd love to hear more though as I am trying to decide whether to extend lease now or wait. Thanks.

I read this thread then a few hours later this crops up on my news feed. Here's what you can buy in London for £350k

My London: London house prices: What £350,000 will get you in 4 different London Underground zones.
www.mylondon.news/news/property/london-house-prices-what-350000-19612463

Our first flat was a 'two bed', but really it was a small box room off the main bedroom. 2 kids later and a slump in property prices meant living there was awful, everyone in each others way.
I strongly advise you get a two bed, or a large one bed that can be split. You talk of starting a family in 2-3 years, use that time to do the place up, maybe even take in a lodger if you can stand it and build up some savings - you'll need them when a baby comes along.

@LBOCS2

Something like this? My sister lived on this road for a while, it's off the high street but still quiet and it's very good for transport. Like a PP said, first floor but has direct private garden access.

I love that flat but my commute to NW London would be atrocious!

@User23456 I would definitely wait until things are clearer. But the government has announced it and so it's safe to say there will be reforms in favour of leaseholders.
www.gov.uk/government/news/government-reforms-make-it-easier-and-cheaper-for-leaseholders-to-buy-their-homes

Thanks for posting this info Onlychildandhamster. My lease is at 82 years and I was just about to seriously look into extending my lease - I'll keep an eye on the news.

Oh god, having lived in a flat with these issues, I wouldn’t touch it with a barge pole. Anti social behaviour can literally ruin your life. Do not underestimate it (obvs there are degrees). Having been through that shitshow, I will always always value good neighbours and surroundings!

Have to say, we have noticed lots of empty chain free flats on the market in our area, and a LOT of reductions. We are starting to find suitable 2 beds within our budget that work for our very specific set of circumstances (work location etc). I really appreciate the MN wisdom, as much as we have enjoyed living where we do, buying a 1 bed could prove to be a very costly mistake.

Good news for you. Zoopla can sort searches by most reduced.
There may also be a lull after the stamp duty deadline.
And if you have a pick of places, consider good school areas/catchments, as that can help to boost resale.

I think there are several issues that come into play in London. DD has a SE postcode but the desirable properties are holding their prices. So close to an underground station and not far into zone 2 and prices are holding up. Especially flats that are purpose built with a garden and open spaces nearby. So it’s not reductions everywhere. But location is so important and gardens too.

Many people are stuck in clad flats. They are not in the market for anything. Neither can their flats be sold. This has affected the market. You cannot beat a decent purpose built flat in a good area. Two beds would be difficult on that budget in a good location in zone 2 though. Further out, probably.