FTB: Buy now or wait?

[FirstTim3Buyer]

Looking for some advice from you lovelies

DW and I are turning 30 soon, so expect to have our first child in the next couple of years. Been viewing properties since March, when the market was crazy and people were offering 10-30k over asking. At that time, as interest rates were lower, we were looking in the 280-300k price range.

Now, we saved up a deposit of 45k (18% LTV), and had an offer of 250k accepted (haggled to get 5k below asking) on a 3-bed semi.
Rates on a 5-year fix are 5.84% (but could rise again next week!) so our monthly payments would be £1200-1300 (for 30 or 25 years), which is affordable but a bit more than we’d like.

Our current rent is £875 monthly on a 1-bed flat, and would rise from January.
If we don’t buy and wait, we’re likely to move to a bigger flat, which could be £1000+ for rent

If we buy, I’m worried prices fall (though it’s a fairly popular area) and a house we like more comes on in the next few months. Also, if interest rates drop we would feel like we bought at the worst time.

If we don’t buy, and interest rates stay the same or rise next year, and supply drops (as less sellers are willing to sell at lower prices) I would wonder if we missed a chance.

DW is not completely sold on the house - she liked it on the first viewing, now thinks it’s “above average” i.e. good enough to live in, but didn’t have a particularly special feeling that it’s “the one”. The area is nice although a little far from the city centre (25min tram). It’s spacious enough inside, although instead of a back garden, there’s a paved patio area at 2 levels with steps down. I'm probably 70-80% happy with this house, if we go ahead I'd think we'd stay at least 5 years to ride out any price drops, but not looking to stay there very long-term.

This is the house by the way

I like the house and I think that’s a great price for a nice suburb of Manchester

I would go ahead and overpay as much as you can.

In the same boat but we haven’t found a property yet!

I would go for it. You need somewhere to live. Hoping mortgage rates come down is just gambling, they could go up. I think it’s a lovely house. Garden looks fab for entertaining, and is low maintenance (mowing a lawn is hassle). Good luck whatever u decide.

That's a lovely house! 😍 Looks like you won't need to spend money doing it up either and the garden is massive.

I'm FTB too we've offered on somewhere and it's now progressing. I'm having to stop watching the news and stressing about prices falling as we offered slightly under and will be there long time and as previous poster said we plan to overpay.

Good luck.

Thanks, and it does seem a decent deal.
This is 1 stop to the very popular Prestwich, where prices are even higher (saw a £325k dream home 3min from Prestwich tram stop, but out of our budget ofc)
DW might prefer the south though (Stretford/Sale) area - I told her we can move there after our kids are closer to high school age

Thanks for the advice, how does overpaying work? Not sure we'd have enough leftover, as we don't want to be using up our salaries each month with the rising energy and food costs (looking to buy a car soon as well)

Good luck with your search too! Been a crazy year but I hope you find something. There's still a lot of market uncertainty right now. Some told me to wait until after the OBR report that's coming. Probably can't keep the seller waiting that long though

Do you live in the area currently?

That seems very cheap for whitefield. We are going to sell our house in whitefield next year and nothing has sold on our street in the past couple of years for under 350

Some of my own pics to show the size of the back - behind is a school field, but only used during sports days so won't be noisy.

We've never really done gardening, so low maintenance would suit us.

But DW really not a fan of the steps down (looks to be over 1 metre height diff). The lower area is enough to take a table of 6, and is east facing. She's worried about reselling if buyers prefer grass.

Besides the market and interest rates, this is the main thing holding us back - not fully happy with the back garden. Ofc there will always be compromises somewhere.

Other issues we found on viewing: door frames were old and cracked, painted over to hide.
Some kitchen cupboards were not in best condition inside. The handle was falling off, from the sliding door from dining room to back patio. I'm guessing most of this isn't too expensive to fix.
We haven't done a survey or searches yet as we'll only do that if we're quite committed to buying.

Thanks for the tips :)
It's a good point and one of the drivers to buy is that we don't want to keep renting as rents go up and paying someone's mortgage.
A rough calculation I did is that about £1000 of our monthly payments would be going to interest, dropping under £900 after 2 years.

We viewed another house, older interior nearby with gardens to the front side and back, so we'd get a lot more land with that, but don't fancy spending lots of renovations and extensions - that would be for those who had the capital to invest and improve the property over 10 years maybe, whereas we can treat this one as a house to get on the ladder

If it's a longish term thing and affordable, if you want the house do it. No one has a crystal ball, no point trying to time the market.

I'd say of that specific house, it's nice but the garden is not ideal of you are planning on having a toddler running around it - though you could fence and gate the top bit to stop them throwing themselves off the edge!

No, we live just south of Ancoats, and have loved the convenience of being that close to the city.
Can't stay there forever though - our flat is on the smaller side and gets no sun.
The house would be close enough to Aldi and Morrisons, especially if driving. There's a grassy kids' play area behind

I have a lot of good friends who live there, one actually very close to that house. The area is nice. A lot of young professionals moving there. Easy to walk to Prestwich centre and Heaton Park. Prestwich/ whitefield have more going on than it used to but don’t believe anyone who tells you it’s like a mini- Chorlton. Motorway can be quite noisy. I think it eventually become background noise but if you’re not used to it it can make using the outdoor space less pleasant.

Definitely go and listen to the motorway, in the rain if you can. Don’t forget the noise is 24x7 and really kicks off after 6am.
The upper patio needs some work, at least repointing, but if the slabs are uneven you may need to lift and relay a few. Relatively easy job so don’t be put off by that.

You need to make the decision based on now, not what might happen, or you will just go round in circles to ages.

we bought when the interest rates were about 6% and then over the next few years they dropped to about 2% which was annoying. After a couple of years we started chipping extra little bits in each month to bring us down the next ltv bracket when we remortgage. Started with about £100 extra a month. We were young when we bought (23 & 26). Over time we both got payrises and that all got added to the mortgage. We originally had a 35 year mortgage, and managed to pay it off in less than 15 years. We didn’t move though which helped I think.

Looking at semis on the road you are buying what have previously sold for, around 4 years ago they were going for around £170k and now £250k,that is a 47% increase in just over 4 years ago, that to me is simply unsustainable and likely to decrease over time, even with your 17% deposit it could still be risky, but its upto you, you may stay there long enough to ride out any potential negative equity

I bought in 2007 my perfect dream house on ghe right side of the street, obviously what happened in 2008 happened and the guy over the road paid £60,000 less for a house on the same street. But what the land registry prices won’t tell you is that one of the bedrooms the he had was on unusable and had no actual windows. The house needed everything doing from a new roof to a rewire. Being on the other side of the street his garden gets absolutely no sun whatsoever my house basically stops it, The garden is about half the size and you can’t really do anything with it cause it’s like clay type mud.

he was really handy so that didn’t bother him in the slightest he was able to do all the work himself and he probably feels like he’s got a great deal but even at 60 K less I would not have bought that house and no others came up on the street for sale before 2021 when I sold mine.

And of course i made £100,000 profit, plus equity.

How would you feel if the same house was 10/20/30% cheaper in a years time? Annoyed but glad to be settled and not interested in moving for several years or panicked and upset?

I’d go for it. You’ve got options if you want to do work in the future. It wouldn’t be a huge job to lift the slabs on the lower part of the garden and turf it.

One thing I'd query is does the lower part of the garden flood? The paving slabs are very green. At a previous house of mine, that was because it was prone to flooding after heavy rain.

So in two years, the amount of interest you'll be paying per month will be roughly the same amount as you're paying in rent right now. Less if you make overpayments. It seems a no-brainer to me: buy the house :)

Thank you everyone for all your views! It's been very helpful 😊
We decided to go ahead and the bank should be doing their valuation of the house soon.

Our mortgage advisor recommended a package of life insurance, serious illness cover and mortgage payment protection for us, which comes to £93 a month to cover us both (company is Vitality)

The serious illness part is the most expensive.
Given we don't have children yet, and are in relatively good health, I feel this level of cover seems excessive.

Home and contents insurance we will get definitely, but not sure about the Vitality package - we're aware our advisor gets paid a commission if we go with it

Don’t you have life insurance off your employers?
Mine or my partners pays out 4 x salary. Similarly they pay 2 years serious illness at 80% salary.
£1100 a year is quite a bit of expenditure for 2 young people.

Don’t just take the package they recommend! Shop around. And check the small print.