Interesting!!.....houses coming on market...wdyt???

[Becaroooo]

Lost out on a house purchase in July as our buyer started playing silly buggers

It was a 3 bed detached, built in 2004, garage and garden, conservatory etc Needed nothing doing to it.

Anyway, 2 more (pretty mcuh identical) houses on the same estate have come on the market this week!!

Only drawback is that neither of them have a conservatory (i.e. 2nd rec)
One of them has a larger garden and new kitchen and the other has been altered to be open plan downstairs.

Would mean going 3 x dh's salary and I reckon the repayments would be £750 a month (Dont want to go any higher than £800 p/m)

wdyt? Mad to buy now? Wait and see? Two other houses on that estate (inc the one we missed out on!) have sold very quickly recently....

[MatLeaveForever]

I know a lot of people would rather sit it out in the rental market as they're nervous about house prices going down and down, but personally I find renting is more expensive than a mortgage, and a house is for living in and not just an investment. I'm (fingers crossed) moving in a few weeks and hope to stay there a long time so don't care if prices dip, it'll be my home! No one knows what will happen to the housing market and I wouldn't want to wait around, putting my life on hold, in case I lose out on a few grand over the years.

Anyway so I think what I'm saying is, if you like the houses, would love to live there, and can afford the repayments then go and have a look round at least! You can always add a conservatory in time.

[Becaroooo]

Thanks MLF We are looking to stay there for a long time...til the dc are grown anyway! Ds2 is nearly 3 so we are looking at 15 years min.

Its just so hard trying to decide what to do...we are no chain, have a deposit, can get an AIP within 24 hours and dont mind waiting for vendors to find somewhere else as we like out rental place!!! (shame its so small!)

Tbh, I dont think we would do anything to either houses....done the whole extending, ripping out bathrooms and kitchens and new windows and boiler in our old house so am quite happy to buy somewhere that we can just move into and start living in!!!

[MatLeaveForever]

You sound like the perfect buyers so hopefully could get the house you want for a good price, good luck!

[Erebus]

I know exactly what I'd do in your position! I'd go for it. You're good and ready and 3x a salary is well 'do-able', considering that we were getting up around 8x to 10x salaries in 2007!

As others have said, if you're doing it to be a family house for a longer term, you're far better off buying, esp as reports are suggesting that it is increasingly becoming a landlords market again, rents going up with increasing demand; ease of obtaining a BTL loan over a FTB loan and so on.

As for 'what will the market do?'- well, as long as you can go on affording your repayments, does it really matter? Especially as we tend to buy and sell in the same market.

Our conservatory, 3m x 4m cost £8,000 in 2009, fwiw.

[Becaroooo]

Thanks erebus

According to our IFA repayments may be more than I initially thought!! £880 mark.

Just cant decide what to do....

1. go for a bigger detached house with garage and pay the price (i.e. larger repayments over longer term) or
   
2. go for something smaller, eg: semi or cottage with no off road parking (smaller repayments and shorter term and have more disposable income)
   

sigh.....

[leeloo1]

If you can afford to then definitely go for the bigger detached house, as you're 'future proofing' your investment (as DC get bigger and need more space, or if more DC come along). Moving costs so much that it'd be awful to move into a small property and then find in a couple of years you feel you've outgrown it.

[Fimbo]

Go for the bigger house. You don't need to go in all guns blazing straight away, a conservatory can be added at a later date. If you go smaller you will always think that you should have just gone for the larger option.

[mollschambers]

Word of caution - repayments of £880 now. Interest rates will go up at some point.

[Becaroooo]

molls Yeah. Its pretty scary. Wish I knew what to do

BBC this morning are saying that Interest Rates will stay low for 12-18 months but then what will happen????

[mollschambers]

That's the thing, they can only go one way.

I'm no expert but I think they will go up in small increments over the long term but the economy is in such a state who can say? Bear in mind that putting up interest rates is one way of reducing inflation so it's a balancing act. BoE are also aware that major increases will result in people being unable to pay their mortgages so are keen to avoid big increases in the short term .

As long as you have some room in your budget to pay more than current payment then I would go for it. In fact I'd be tempted to overpay while rates are so low.

[leeloo1]

But whilst interest rates are low, get a bigger mortgage and overpay to reduce the borrowing/term, and/then get a fixed rate, so you know what your repayments will be. :)

[narmada]

You could always get a fixed rate from the off if you're really risk averse but you will certainly end up paying higher initial payments than if you were on a discounted rate.

Where we are mortgages of 3x salary are nothing exceptional - we, and most of our friends and acquaintances, are more heavily indebted than that. Obv that's not ideal in any way and not what I would want, but we needed somewhere to live and there's nowt available round here for anywhere near 3x DH's salary!

[Becaroooo]

Going 3 x times makes me feel slightly nervous narmada although I realise its pretty normal....

If we went for a 5 year fix it would mean a longer term and higher repayments but may be worth it long term....

[narmada]

becaroooo how old are your children? Is there any chance your salary will rise (or your outgoings will drop - e.g., no more childcare) when they go to school full-time?

[narmada]

3x is normal I think - my parents had that multiple when they bought their first house in 1972. It really depends on your other outgoings though, doesn't it? If they're fairly low, then you could afford to absorb an interest rate hike.

[Becaroooo]

Other outgoing just food and utilties really (no car loan, HP or card debt)

Ds1 has just been dx as dyslexic and therefore we may need to pay for special help/tuition etc for him.....makes me nervous of committing to 3 x salary

[myron]

Personally I would hesitate to commit to more than say 30% of our disposable income on our mortgage payment and we have low interest rates at the moment which are very likely to go up in the near future.

[ChitChattingWithKids]

You can get a fixed interest rate mortgage that will still allow you to make extra repayments (up to 10% of the outstanding mortgage) which means that when it comes time to refixing your mortgage at the end of the fixed rate period you will be in a position to work out more reasonable payments even if interest rates have gone up substantiallly.