# House buying.....need some advice



## Estoril-5 (Mar 8, 2007)

Here's the situation.

Been renting since Sept 2009. Up until now, I have paid aout £12k in rent.

I know there are some people in the 'its all dead money' camp or 'you're paying someone elses mortgage' etc.

BUT 

1. The house prices in Birmingham are ridiculous
2. I could buy but not somewhere i'd want to (cheaper housing)
3. I didnt buy as i thought house prices would come down

Now my general thinking was if house prices come down for example by £20k, and ive paid rent of £12k. then he presto, ive saved myself £8k+interest charges.

although house prices have come down i dont believe there are massive drops to come.

Now at the point where the rent i have paid becomes more than the drop in prices. i start losing out so to speak.

The question is do i buy now and start paying off my mortgage or keep on renting?

i still think houses are overpriced and if they are not going to get cheaper why pay 5 years worth of rent and then buy at the same price i could have 5 years ago.

one thing i do want is a semi-detached as a minimum, 3 beds, a garage and a big garden would be a nice to have.

some people tell me to buy a cheap terraced house so i can get on the ladder, start paying off some of my mortgage and use that as a stepping stone to get to the house i want after several years.

i want to just jump the ladder and get to where i want, problem is these houses cost £1/4 million.

i know if i buy a stepping stone i wouldnt be 100% happy and looking for the next step.

if i buy 'the one' as i call it. i reckon ill be there for the next 15 years or so.

what do i do cos i havent got two hoots!????


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## NarN (Jun 24, 2011)

Wife and I bought an apartment first, cheap compared to a big house. After 3 years our first child turned 1 and we wanted a garden for her to play. So, after 3 years we bought a house and sold our apartment. 

The mortage was not that high, I had a few savings and with the increased selling price (about 40% in 3 years) of the apartment we could keep the mortage on the house low as well.

Local banks advice not to spend more then 1/3 of your net income on a mortage. But that's in Belgium...

My advice is to do either the same as me (buy small and sell/buy bigger later) or buy now. Renting is throwing money away. You can't speculate on increasing or decreasing of housing prices, no-one knows.


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## chillly (Jun 25, 2009)

Cant see house prices going up or down mate. if they do it wont be by much. only advice i have and wish i did is beg borrow steal share rent move back in with parants do what ever you can to save enough for the house you require for the next 20 plus years. If you just jump on the ladder take into account the cost of doing the house up to how you like it then the moving cost to eventually get the house you wanted in the first place. Good luck and i wish you well with it:thumb:


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## Estoril-5 (Mar 8, 2007)

Just dont know wht to do, i suppose the next thing would be to see if i get a mortgage.

ive done the online calculators and stuff and it seems i should be able to get a mortgage but the actual amounts vary alot!


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## The Cueball (Feb 8, 2007)

A couple of things from my point of view:

Please remember when/if you go for a mortgage, that they people are there to sell you a product, they do not care about your welfare, your future or anything like that... they want sales and bonus...simple....

I would never go above 3 times my NET income... gross income and o/t or bonuses should never be used to work out how much you can afford.... 

There is nothing wrong with renting.... people who think that because they have a massive debt to a commercial bank they actually own something, are just idiots, plain and simple...

I would never buy a “stepping stone”... it’s better to rent somewhere in a nice area than get a noose around your neck in the middle of a war zone for the sake of egos and property ladders...

If you have a good rental, with a good landlord, then I would keep put, and try and save as much as possible every month in life until things settle back down again...I think we still have a couple of rough years ahead of us....

Houses in the UK are criminally overpriced, but they will not be allowed to fall very far, too many rich people have too much interest in them.

At the end of the day, do what is right for you, and don’t take anything as gospel....especially from people with agendas against you.... i.e. people willing to give you money.

:thumb:


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## Auto Detox (Dec 22, 2007)

First you need to talk to a mortgage advisor & a good one too ! not some one that can "sort" you a mortgage so they can earn the commission.

Think long & hard about the monthly payments depending on what type of mortgage you take on they can go up or down, if something happens ( job loss, illness, partner moving out etc...) can you still pay it ?

As you mentioned, you said you will probably be there for 15 years make sure you are going to like it don't take on a cheap place in a dodgy area to get started, think about selling it later will the area get worse ? if so it could be a pain to sell in the future

Think about stamp duty, solicitors fee's, moving fee's, deposit, council tax, estate agents fee's 

a good solicitor can make the stress a lot less ( there is a lot of stress buying a house) if you are unsure ask the estate agent, family & friends to recommend one to you 

There's a lot to look into but a good advisor & mooching about can get you the answers dont be afraid to ask the solicitors, advisor, estate agents what commission/prices they charge too

ok enough lol
Baz


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## Auto Detox (Dec 22, 2007)

The Cueball said:


> A couple of things from my point of view:
> 
> Please remember when/if you go for a mortgage, that they people are there to sell you a product, they do not care about your welfare, your future or anything like that... they want sales and bonus...simple....
> 
> ...


This man makes a lot of sense


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## Estoril-5 (Mar 8, 2007)

I have the mortgage advisor and solicitor on hand, family friends, they have done many deals/instructions with my dad and would only advise me for my benefit (and ill get the comission  )

i want somewhere where i know i will be for a decade or two. im 30 now, i want to be mortgage free by the time im 50 hopefully.

im buying as a home and not investment. i just want to be sure i dont buy at x amount and then tomorrow it drops by 20% etc.


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## Gruffs (Dec 10, 2007)

Firstly Renting is not throwing away money.

Renting more than you need is throwing away money.

Rent the cheapest property you feel that supports your needs for rooms and area, schools etc.

Buying is not clever if you buy a stepping stone house atm. 

Prices are not going up or coming down. If you buy a stepping stone, you will sell a stepping stone at the same price plus all the fees and interest.

Rent the smallest property you can and when you buy, buy a property that you never have to move from and if you do, is rentable for your own means. Stepping stone houses in my area will not make money any more as people have realised their full potential and they are just not value for money. New builds especially will become the first kind of house to depreciate with use and number of owners IMO.


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## justina3 (Jan 11, 2008)

Cueball as always raised some very valid points, I would be looking at auctions at the moment I was in one last week and the amount of repossessions floating through there where bonkers haven’t seen that many in ten years it appears there back to being good buys years gone past all you had in there where the out and out sheds that only builders where interested in or small plots of land again for builders to build on and sell on in an over inflated market. 

As with any major investment you need to do your homework I would go to as many auctions as you can to get a feel for them so if you did go down that route on the day your looking to buy you will not be overwhelmed by the event.

Of course I simplify the situation buying from auction needs a lot more planning that going through an estate agent but the gains can be huge. 

For me renting is not something I would do but each to there own


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## Gruffs (Dec 10, 2007)

Estoril-5 said:


> Im buying as a home and not investment. i just want to be sure i dont buy at x amount and then tomorrow it drops by 20% etc.


In that case, it doesn't matter if you lose a few % in the short term. Long term, it will stay the same or appreciate if you buy the right property.

As long as you can afford the mortgage, it doesn't matter what it's worth to someone else, it's your home.


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## Estoril-5 (Mar 8, 2007)

what i was trying to say is i dont want to buy for £200k and in a few months its down to 180k, i.e 10% drop.

I would hav saved £20k plus interest charges.

im not worried about the house price in the long term just short term when im about to buy


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## The Cueball (Feb 8, 2007)

Estoril-5 said:


> what i was trying to say is i dont want to buy for £200k and in a few months its down to 180k, i.e 10% drop.
> 
> I would hav saved £20k plus interest charges.
> 
> im not worried about the house price in the long term just short term when im about to buy


You can go around and around for every thinking about A, B, C...etc

maybe the house would have fallen to 180k... but maybe you wouldn't have the chance to buy it when it does...and you have missed out.....

If you buying for the long term, and are not selling...nothing like that matters...

I always remember 2 things my old boss said to me about buying houses:

1) At the end of the day, after 25 years, what does 2k matter... (when asked if he was going to offer less than the selling price...he didn't he paid "full price", but at least he got their dream home)

2) The first thing I do with a new house, is plant trees.... (meaning, by the time he has the house sorted, the tress have grown and his garden is 50% complete... don't wait to plant something for the future)

:thumb:


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## Estoril-5 (Mar 8, 2007)

im probably just being thick but i didnt get the trees bit?


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## The Cueball (Feb 8, 2007)

Estoril-5 said:


> im probably just being thick but i didnt get the trees bit?


Well there is 2 bits to it..

Number 1...don't wait to do something for the furture...

Number 2... if you completed all the inside of the house first, then started on the garden...the trees would be just planted and very small... they need time to grow... to plant them first, them by the time you get around to actually doing the garden, they have started to grow and are settled...

:thumb:


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## kh904 (Dec 18, 2006)

As usual I have to agree with Cueball (or is he agreeing with my view? hmmmm  ).

IMO i truely believe (i've said this before, early last year), that we will start to see the real effects of the recession/credit crunch in the middle of 2011. 
The economy has been artificially propped up with more debt, but it was only wallpapering over the cracks.

Interest rates will rise & many people with mortgages will not be able to keep up, people are losing jobs, pay freezes or even pay decreases, unfulfilled obligations (Greece anyone), increasing inflation etc etc. IMO the bubble has still more to deflate.

The question is, do you have enough savings (proper liquid cash), how big is your deposit, what effect will an base rate of 6-7% (historical average) have on your finances etc.

Don't be forced/pressured by keeping up with your peers/ society to buy something you cannot afford, you will pay for it & suffer later on!


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## Estoril-5 (Mar 8, 2007)

so what do you guys predict for the next 6 months?


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## The Cueball (Feb 8, 2007)

Estoril-5 said:


> so what do you guys predict for the next 6 months?


Well I know that the US army are stock piling missiles, as one of my companies has just got a £500k contract for this...so there may well be another invasion soon...

The Greece situation isn't going away any time soon...

The UK is going to have more unrest and strikes (I support them, but not the way they are doing it btw)

All of that is going to keep everyone on their toes.......I think interest rates will start to creep up...they have been kept the same for 27 months , but the "yes" vote is becoming less and less.... so not long to go until they start to rise (imo)

So what is all that going to do for the housing market... I don't think anyone knows, so maybe....just maybe everything will be stagnant as people will be trying not to panic and devalue "their" home, but at the same time no-one will want to move in case they make a mistake or get laid off....

The housing market needs a kick start, but a shortage of sensible sellers, realistic prices and very hard to get lending terms means that it's having the opposite effect...

Sometimes, doing nothing is the correct thing to do....

:thumb:


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## justina3 (Jan 11, 2008)

the news alone yesterday highlighted 5000 job losses as already mentioned i think 2011 is going to be a hard year xmas is what everyone hangs onto thinking it will save them however the last two years have proved that old school thought to be wrong.

it always used to be a case of the fitest will survive i dont think that is the case anymore so many outside problems that can cause a healthy business to suffer.


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## s2kpaul (Jul 27, 2006)

If you budget well and do planning buying a house should be fine, But dont get the cheapest in the ****test area cause your just have problems selling it. Ride the wave and choose wisely. If you hit the market when intrest rates start to go up you may get a good deal price wise.


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## Tricky Red (Mar 3, 2007)

All I will say, is never buy the best house in the worst area. You can always improve the worst house in the best area. 

There is nothing wrong with renting, house prices will not come down measurably. If you are buying, then buy what you can afford. In the short term you will be fine and in the long run, you will be no worse off than you might have been if you had extended too far. :thumb:


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## Estoril-5 (Mar 8, 2007)

yeah definately, buy a crap house in a nice area.

thing is even the crap houses are expensive :wall:

i think im going to go and see the mortgage advisor and see who will lend me what.


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## justina3 (Jan 11, 2008)

make sure they are indepandant


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## Estoril-5 (Mar 8, 2007)

yeah he is.


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## kh904 (Dec 18, 2006)

justina3 said:


> it always used to be a case of the fitest will survive i dont think that is the case anymore so many outside problems that can cause a healthy business to suffer.


This is true because IIRC UK Ltd is bankrupt and effectively in chapter 11 receivership.


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## Noakesy85 (Dec 27, 2008)

The girlfriend and i are in the process of buying our first house, im 25 and she's 22. We decided to skip the 'typical 1st time buyers house' and go for what we could with the funds available.

We've just had an offer accepted on a 3 Bed Semi with a huge garden and a double length garage for £128k which safe to say, we're over the moon with!! Granted at the moment it doesnt look like much but luckily the majority of the problem is the Decor (propper nast 70's style interior. euchhh)... not to mention the disabled shower and the stairlift that needs to come out  The property has been on the market for a while now but nobody wanted it because of the superficial stuff (which is a bit stupid if u ask me). Its in a nice residential area with local emenities close by etc.

With our 10% deposit my repayments should be in the region of about £600 a month which i cant complain about at all!!

I think the moral of this story is just to keep your eyes open for a great deal and dont be scared to go for a property that needs a little bit of TLC. Alot of people will look at a property with great potential and say no simply because they dont like the interior decor, it just takes a little bit of vision to look past that and see whats laying underneath.


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