How do you get onto the property ladder??

[wooliemam]

I don't mean to sound stupid or thick here.

But we are a family of 4/5 (step daughter comes here also) with an annual income of around £50 (I am not working but will be next year so this will rise to around £75k.

Our outgoings are high- rent alone is £1750pm.

We have around £20k in savings.

We find it hard to save if I'm honest!

Around where we live; even if we moved a little further, a 4 bed on average is around £500k. Even if we saved £50k for a 10% deposit, the mortgage calculations are stating our monthly repayments would be £3,500pm!

How is this possible? How can anyone do this? Even with me back at work after tax and outgoings we couldn't do this.

Am I just being naive or stupid here?

Have you tried reversing the search on Rightmove? So put in the area (you could do that draw a search thing) put in number of bedrooms and then go low to high rather than the other way round. That is how we found this house. In catchment for a in special measures primary but our children were already in an incredible primary and I would just have to drive them back to that school every day.

Look at houses with potential to extend or needing work. There are hundreds of videos on Youtube showing the average couple doing up their house or professionals showing you how to sort out problems inside a house. We have renovated 2 houses with children to increase the value and move on. We are in a 4 bed detached but this is house number 5 for us, 2 rented then bought.

We bought our first house when I was 35, my husband 39. I was pregnant with our first child. We bought a 2 bed house, no drive as that's all we could afford (expensive area, 25 mins on the train to London). A succession of events happened resulting in us having 5 kids now (7 years after buying our 2 bed). I had to give up my career to look after the kids and although I work part time, the salary is minimum wage, no chance of buying a bigger house.
So we renovated. Last year, we did a loft conversion so we've now got a 4 bed. Despite the house gaining in price significantly, we are still out priced in the area and don't want to move as the links to London are important to us. So we're now looking at a kitchen extension so we're not on top of each other as the kids get bigger and then further down the line, we'll put in a garden room. No one these are a quick fix obviously.
I think you have to buy what you can afford but try and get something that has potential. Or as someone else suggested, look at shared ownership.

Does anyone have any further info on part buy part rent?

Could we do that alongside a mortgage guarantor perhaps?

There is a 4 bed property for £499,999 and they state they do part buy, part rent but unsure that is likely.

You can't buy a half a million pound house of you earn £25,000 a year

I bought my first house, 2 bed mid terrace, for £92k in 2017. It has increased in value by 50% and I have 50% equity now. No way could I have bought a £500k 4 bed house as a first purchase.

You should Google Shared Ownership for some general advice on the pros and cons. And then maybe speak to the Seller of the part buy part rent house.

Even if you can't afford it just yet, it may be something to consider in the future when you are both working.

You aren't in the right income bracket for a £500,000 house to be feasible.

You need to reset your expectations to a 3 bed house with the kids sharing (one room for the girls, one for the boys and one for the grownups).

Once you have returned to work full time you could probably qualify for a 50:50 part-rent-part-buy deal. 50% is bought by you with your deposit and mortgage, the other 50% is owned by a HA and you pay 50% of the market rent.

It's really tough op. House prices are such a nightmare.

This is how we did it:
We started with shared ownership, before we had kids. We stayed there for a decade.
After having one child, we sold our shared ownership and moved to a 2 bed without shared ownership. To be able to afford this we had to significantly downgrade. We're now in a worse area, much less nice than my flat, and actually overall smaller (although we now have a garden). Dh works from home but does not have a home office.
We had our children later in life, I'm 45 with a 2 year old.

With house prices now, we'd probably still be in shared ownership, with a smaller share of the property.

My partners take home is £57k and mine will be £30k ish when I go back to work.

Maybe less at £25k actually

Even 3 beds are extortionate too; £350-400k. But yes I think we will have to look at 3 beds for sure.

I thought the housing ladder was dead.

I own a 2 bed flat with DH, no kids yet, but what i am considering is moving to a bigger flat so not really a ladder, more like a lateral move. Would increase the mortgage but not by much.

When I bought, I knew I probably wouldn't be able to move to a house, but another flat. Even in the 1990s, my MIL upsized from a flat to a house (also in north london like me) but it was a 'compromise' house that was very small, in need of a lot of work, next to a drug dealer (thankfully area became more family friendly) and was equivalent in value to a flat in a nice area. She was choosing between that and an ex council flat that was practically on the railway tracks. Between a 'compromise house' and a flat in a nicer part, i choose the flat. Even today, her house is the same value as a flat in a nicer part of north london even though houses in london have done better overall and her area has improved a lot (in terms of demographics) and is near a university (which has many international students now).

Sorry, but I think you'll need to look at 3-beds - both open market & shared ownership.
I know someone with 5 kids who is in a 3-bed house - they make it work because they have too.
How is the new build market where you are? Are the house builders having to reduce their prices? They are around us (south west) so will be more open to offers. This is how we bought our house (but this was 11 years ago) - the builders were struggling to sell some of the houses with north-facing gardens, so we made an offer below asking & it was accepted because it was just before their financial year end & they wanted as many sales as possible.

Ok. Assuming you can find a decent 3 bed for c£360,000 and assuming that would typically rent for circa £1700pcm, with a 50:50 shared ownership you would pay rent of £850pcm and get a mortgage of £160,000 along with your deposit of £20,000 to buy the other half. With a 30 year term the monthly mortgage repayments would be around £700ish depending on your mortgage deal so you are about £150pcm better off than if you just rented the same property, and after 30 years you completely own that half of the house so your outgoings reduce dramatically (hopefully you get there in time for retirement)

In your position I think I'd try and save as much from your wage as possible. Set up a standing order from the off so lifestyle creep doesn't just eat it up.

I don't think you gain much from trying to buy now. Prices are high and so are interest rates. You are also in an awkward position with school places.

I'd save as much as possible for three years so you have more like 60k deposit. By then the older kids will be in secondary and more independent so you could move out of catchment (assuming you are in a good catchment now). Your youngest will be in primary but with enough years for secondary offerings to change.

Hopefully by then you might be working more hours and the housing market, while unlikely to fall massively, will have settled as will interest rates.

You may have to compromise on bedrooms for a few years with perhaps a multi purpose downstairs room for a few years.

The U.S inflation data today is "hotter than expected" (surprise surprise) mortgage rates are going higher, sensible buyers will wait.

If his take home is £57k then his salary must be pushing £100k?