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runningJon

Thinking Of Buying

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I've been reading HPC for a few years but only now have a question to ask. I'm thinking about buying. I have a deposit of £50k and a decent job paying around £50k a year. What I'm considering is buying a 3 bed house in Cardiff for around £120-130k. This would mean borrowing around £70-80k, ~40% deposit. On a 5 year fixed, 5%, 15 year repayment mortgage this would work out at around £560 a month.

However in January I'm leaving that job to join the university for a PhD. The PhD will pay around £14,500 tax free (so equivalent to around a £19k taxed salary). I also wouldn't have to pay council tax as a student... and I'd sell the car!

The motivation for this is that I could rent out a 2nd room to another student for at least £300 a month making the mortgage totally affordable on my reduced PhD 'wage'. The PhD also means I'll be sticking around for at least 3 years. I've been renting for the last decade and I'm bored of it – I want somewhere that feels like mine. I'm worried about inflation with respect to my deposit. Looking at th 15 year period as I'm 32 and basically want to clear the loan sooner rather than later.

So how crazy and idea is this? I'd try and get it done by the end of the year so all the mortgage application/approval stuff went through on my current salary rather than complicating things with the PhD situation. I appreciate house prices probably have another 15-20% to fall on top of the 20% falls already.

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Hi and welcome,

It seems like you've actually answered your own question. You're very aware of the probable house price falls to come, and are still happy to buy. You've done the affordability figures and are also happy.

My advice though is to find numerous houses you like and offer on all of them. I imagine in your price range there's quite a few similar ones.

Play the offers off against one another and act indifferently towards all of the houses you offer on, as if to say, 'I'm buying a house, don't really care which one of these 4 it is though'. Don't ever get excited about a house in front of either seller or EA. Never, ever, ever deal with the EA's inhouse mortgage broker. You do NOT want an EA to learn your full financial situation. It is none of their business and they will use it to their advantage.

Good luck

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I've been reading HPC for a few years but only now have a question to ask. I'm thinking about buying. I have a deposit of £50k and a decent job paying around £50k a year. What I'm considering is buying a 3 bed house in Cardiff for around £120-130k. This would mean borrowing around £70-80k, ~40% deposit. On a 5 year fixed, 5%, 15 year repayment mortgage this would work out at around £560 a month.

However in January I'm leaving that job to join the university for a PhD. The PhD will pay around £14,500 tax free (so equivalent to around a £19k taxed salary). I also wouldn't have to pay council tax as a student... and I'd sell the car!

The motivation for this is that I could rent out a 2nd room to another student for at least £300 a month making the mortgage totally affordable on my reduced PhD 'wage'. The PhD also means I'll be sticking around for at least 3 years. I've been renting for the last decade and I'm bored of it �" I want somewhere that feels like mine. I'm worried about inflation with respect to my deposit. Looking at th 15 year period as I'm 32 and basically want to clear the loan sooner rather than later.

So how crazy and idea is this? I'd try and get it done by the end of the year so all the mortgage application/approval stuff went through on my current salary rather than complicating things with the PhD situation. I appreciate house prices probably have another 15-20% to fall on top of the 20% falls already.

Can you remember the yuppies in the 80s?

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I've been reading HPC for a few years but only now have a question to ask. I'm thinking about buying. I have a deposit of £50k and a decent job paying around £50k a year. What I'm considering is buying a 3 bed house in Cardiff for around £120-130k. This would mean borrowing around £70-80k, ~40% deposit. On a 5 year fixed, 5%, 15 year repayment mortgage this would work out at around £560 a month.

However in January I'm leaving that job to join the university for a PhD. The PhD will pay around £14,500 tax free (so equivalent to around a £19k taxed salary). I also wouldn't have to pay council tax as a student... and I'd sell the car!

The motivation for this is that I could rent out a 2nd room to another student for at least £300 a month making the mortgage totally affordable on my reduced PhD 'wage'. The PhD also means I'll be sticking around for at least 3 years. I've been renting for the last decade and I'm bored of it – I want somewhere that feels like mine. I'm worried about inflation with respect to my deposit. Looking at th 15 year period as I'm 32 and basically want to clear the loan sooner rather than later.

So how crazy and idea is this? I'd try and get it done by the end of the year so all the mortgage application/approval stuff went through on my current salary rather than complicating things with the PhD situation. I appreciate house prices probably have another 15-20% to fall on top of the 20% falls already.

Where is it for that price? Ely or somewhere equally as glum?

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Sounds fine to me.

on 50k deposit and 50k a year you should be able to have one of the best houses in cardifff...

but if your gonna buy best of luck.

less competition for me at the bottom.

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However in January I'm leaving that job to join the university for a PhD.

Is there any obligation to tell the bank than whilst your wage might be good now, it's going to take a big hit basically as soon as the mortgage is given? Seems almost like fraud as the mortgage was approved on the basis of the high wage!

I guess a fixed deal, and assuming you can rent a room out does make it affordable and risk free. The only problem is how much capital the house will lose as devaluation continues.

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I was a kid growing up in the country... no yuppies! What's your point?

So was I, but even I remember the yuppies! Research it - maybe you could learn something.

Those who think they can have it all tend to end up with nothing.

What you have written sounds wonderful but in reality you are deluded.

You want somewhere that FEELS like yours - is that your main motivation to buy?

Are you confident another student will shell out £300pm for a room in Cardiff? Have you seen the number of rental properties available at the moment?

You know prices will drop another 20% and are happy to wipe out 50% of your own deposit? Tell me did it take you long to save for your deposit?

I could go on... <_<

It might be good to remember a little research can go a long way!

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I've been reading HPC for a few years but only now have a question to ask. I'm thinking about buying. I have a deposit of £50k and a decent job paying around £50k a year. What I'm considering is buying a 3 bed house in Cardiff for around £120-130k. This would mean borrowing around £70-80k, ~40% deposit. On a 5 year fixed, 5%, 15 year repayment mortgage this would work out at around £560 a month.

However in January I'm leaving that job to join the university for a PhD. The PhD will pay around £14,500 tax free (so equivalent to around a £19k taxed salary). I also wouldn't have to pay council tax as a student... and I'd sell the car!

The motivation for this is that I could rent out a 2nd room to another student for at least £300 a month making the mortgage totally affordable on my reduced PhD 'wage'. The PhD also means I'll be sticking around for at least 3 years. I've been renting for the last decade and I'm bored of it �" I want somewhere that feels like mine. I'm worried about inflation with respect to my deposit. Looking at th 15 year period as I'm 32 and basically want to clear the loan sooner rather than later.

So how crazy and idea is this? I'd try and get it done by the end of the year so all the mortgage application/approval stuff went through on my current salary rather than complicating things with the PhD situation. I appreciate house prices probably have another 15-20% to fall on top of the 20% falls already.

what colour is your mums hair...is it orange perchance?

I think also for a more balanced reply Id need to see the full list of your income and full expenses, including food, phone, loans and credit cards, entertainment and emergency funds.

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However in January I'm leaving that job to join the university for a PhD. The PhD will pay around £14,500 tax free (so equivalent to around a £19k taxed salary). I also wouldn't have to pay council tax as a student... and I'd sell the car!

Are you sure? Just because it's not a salary doesn't mean you're not liable to pay tax on it!

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Guest Daddy Bear
what colour is your mums hair...is it orange perchance?

I think also for a more balanced reply Id need to see the full list of your income and full expenses, including food, phone, loans and credit cards, entertainment and emergency funds.

come on bloo loo FFS....

Mate - if you search around and do the research you may find good value - look for > 30-40% off

Get a lodger pays half mortgage.

Fix for a long time.

It seems ok to me on the face of things.

Remeber DO THE RESEARCH- use property bee/rightmove etc and use your head - get the bottom of the market for the house you want now - look for qaulity.

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Guest DissipatedYouthIsValuable
your earning 50k PA, :blink: why leave the job?

Perhaps he's a GP, terminally pissed off with spending most of his life in a room alone with depressed people talking about the state of their bowels as he slips into middle age devoid of any significant assets, watching everything going to shit, while the media is bribed to sugar frost this shit and sell it to most of the planet.

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come on bloo loo FFS....

Mate - if you search around and do the research you may find good value - look for > 30-40% off

Get a lodger pays half mortgage.

Fix for a long time.

It seems ok to me on the face of things.

Remeber DO THE RESEARCH- use property bee/rightmove etc and use your head - get the bottom of the market for the house you want now - look for qaulity.

its a formula troll.. full life details and apologies included.

and I think the whole reason for the website is that we all are thinking about housing....beleive it or not!

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This is only an idea just now. I am worried about inflation, also if a bank will lend at a decent rate against PhD wage in the future, also interest rates are only going one way so clearing a good chunk of loan on a 5yr fix at 5% sounds good. We might be looking at 8% in 18 months time! I think the monthly cash flow works - not too worried about further 20% falls as and 2nd house I buy would also fall.

your earning 50k PA, :blink: why leave the job?

It just doesn't interest me these days, not much point in life if it's not interesting!

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Perhaps he's an MP, terminally pissed off with spending most of his life in a room alone with depressed people talking about the state of his expense account as he slips into middle age replete with significant assets he now has to pay for, watching everything going to shit, while the media is bribed to sugar frost his leaders shit and sell it to most of the planet.

corrected

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come on bloo loo FFS....

Mate - if you search around and do the research you may find good value - look for > 30-40% off

Get a lodger pays half mortgage.

Fix for a long time.

It seems ok to me on the face of things.

Remeber DO THE RESEARCH- use property bee/rightmove etc and use your head - get the bottom of the market for the house you want now - look for qaulity.

daddybear

have you seen how low prices go when your inhabitants desert the country ?

http://www.rightmove.co.uk/overseas-proper...EGION%255E83367

UK - 2020

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Guest DissipatedYouthIsValuable
corrected

Haha. Thanks for the sense of purpose.

Edited by DissipatedYouthIsValuable

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Of course most people on here (myself included) will tell you property has further to fall, in Cardiff which inflated less than London maybe 20-25%. Since you're earning so much and planning to buy a relatively cheap house, maybe you feel you can afford to take the hit and would prefer it to staying in rented. It's your life really, you know what you're getting yourself in for.

As for doing a PhD, make sure you think very long and hard about that before you sign up. PhDs are very hard work and can be extremely frustrating for long periods of time. You will not be earning much and you will not get much respect for what you do from anybody (except maybe other PhD students). You have to be very highly motivated as almost everybody thinks seriously about quitting at some point - an important factor that keeps many on board is that you need it for what you want to do in the future. Do you plan to be an academic or a researcher in a company? If you just want to doss about for a bit and study something that interests you, spend some of that fat deposit on a taught masters or something. I guarantee you it will be less painful.

Check out www.phdcomics.com, though you can only see the PhD for what it is once you are inside.

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Mate, hate to say but I don't like the sound of this idea.

Firstly, a lot of people drop out of doctorates. I'm one of them. Thank heavens I didn't buy some place.... PhDs can be a nightmare. See the post above - nobody can understand how difficult and demoralising it can be unless you've attempted one.

Secondly, you may find it very hard to use your PhD income towards payments - I had to go through three months of sh!t as they don't usually accept monies paid from research grants etc. Check this out first would be my advice.

Thirdly, you're counting on somebody renting with you - I wouldn't count on anybody when so much money is involved.

Personally, I wouldn't go ahead with it. I say stick to your job or go for a career change if you fancy something different.

Edited by thomasross20

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Haha. Thanks for the sense of purpose.

you are worth something to me...please keep communicating.

just look out of your surgery window....now, look at the red Mondeo.....see me? Ok, Im a little older than your average pensioner...but hey...Ill be here when you get off.

if you are really a good boy, I might even take my teeth out.

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Guest KingCharles1st

seems to me in a nutshell the o.p. can't wait to start his life change, but KNOWS he needs the security of his current job to LIAR LOAN a mortgage out of someone- without telling them the TRUTH of what he wants to do?

Innit

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