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uncle_monty

Buying A House --Merged

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Mods, appreciate this is anecdotal, but could you leave on the front page for a while?

Thanks,

Monty

Basic details:

1. STR'd in 2008

2. Currently renting in a prime London suburb

3. Good deposit, so can get the super deals (i.e. lifetime tracker @ base + 1.69% (2.19%))

4. Just found a house in the area (5 bed, 2 bath, ok-ish sized garden) that is not perfect , but is a good compromise (big, right area, etc.). Would need to spend a few hundred thousand pounds over our budget to get perfection round here, sadly.

4. Had our initial offer rejected (2.1x joint salary)

Thinking of going back with an a final offer of 2.5x joint, leaving 6 months cash for emergencies. This would then become a max of 3.8x single in 9 months, assuming the Mrs immediately gets pregnant. We would still have the 6 months contingency, although refurb costs would be need to be found (repaint, kitchen, bathroom, though a lot of this we could do ourselves with advice from family).

I've assumed base rates rise by 2% per year up to a max of 8.2%, so our average rate over the life of the mortgage is 7%. Excluding pay rises/bonuses and partner's income (if my wife returns to work at all), the single multiple will be 3.4x in 2 years and 2.9x in 5 years.

Both jobs are stable. Mine is finance-based, but is not exposed to government cuts, health of the banks or GDP fluctuations.

Thoughts?

Edited by uncle_monty

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:lol: you lasted seconds and I am not remotely sure how you ended up off topic unless the mod that moved you figured you had too much money to be asking such questions.

:D

I guess it is off topic, what with the subject matter being a house and whether the price I should pay is reasonable given the risk of a crash!

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Basic details:

1. STR'd in 2008

2. Currently renting in a prime London suburb

3. Good deposit, so can get the super deals (i.e. lifetime tracker @ base + 1.69% (2.19%))

4. Just found a house in the area (5 bed, 2 bath, ok-ish sized garden) that is not perfect , but is a good compromise (big, right area, etc.). Would need to spend a few hundred thousand pounds over our budget to get perfection round here, sadly.

4. Had our initial offer rejected (2.1x joint salary)

Thinking of going back with an a final offer of 2.5x joint, leaving 6 months cash for emergencies. This would then become a max of 3.8x single in 9 months, assuming the Mrs immediately gets pregnant. We would still have the 6 months contingency, although refurb costs would be need to be found (repaint, kitchen, bathroom, though a lot of this we could do ourselves with advice from family).

I've assumed base rates rise by 2% per year up to a max of 8.2%, so our average rate over the life of the mortgage is 7%. Excluding pay rises/bonuses and partner's income (if my wife returns to work at all), the single multiple will be 3.4x in 2 years and 2.9x in 5 years.

Both jobs are stable. Mine is finance-based, but is not exposed to government cuts, health of the banks or GDP fluctuations.

Thoughts?

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:D

I guess it is off topic, what with the subject matter being a house and whether the price I should pay is reasonable given the risk of a crash!

I know, things have started to get a bit weird here. I make some of the bears look like stuffed teddies but got warned off over a couple of posts.

Wish I could help but it sounds like you have more money than I do and I would hope more sense. You really need to share a bottle of wine with the calculator and ignore the OH. Personally, I am still hoping for further falls and do not expect London to escape it. I am expecting some sterling strength which would reduce interest from the foreign buyers that have helped to prop the are up so far. But, I know begger all so do the maths and flip a coin. Good luck.

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Basic details:

1. STR'd in 2008

2. Currently renting in a prime London suburb

3. Good deposit, so can get the super deals (i.e. lifetime tracker @ base + 1.69% (2.19%))

4. Just found a house in the area (5 bed, 2 bath, ok-ish sized garden) that is not perfect , but is a good compromise (big, right area, etc.). Would need to spend a few hundred thousand pounds over our budget to get perfection round here, sadly.

4. Had our initial offer rejected (2.1x joint salary)

Thinking of going back with an a final offer of 2.5x joint, leaving 6 months cash for emergencies. This would then become a max of 3.8x single in 9 months, assuming the Mrs immediately gets pregnant. We would still have the 6 months contingency, although refurb costs would be need to be found (repaint, kitchen, bathroom, though a lot of this we could do ourselves with advice from family).

I've assumed base rates rise by 2% per year up to a max of 8.2%, so our average rate over the life of the mortgage is 7%. Excluding pay rises/bonuses and partner's income (if my wife returns to work at all), the single multiple will be 3.4x in 2 years and 2.9x in 5 years.

Both jobs are stable. Mine is finance-based, but is not exposed to government cuts, health of the banks or GDP fluctuations.

Thoughts?

So your second offer is 20% higher that your first?

Either your first offer was insulating (so it's not surprising it was rejected) or your second offer is too high. (As a guide the difference between what I have just offered on a house and the counter offer from the vendors is 7% and I've dedcided to decline that as too high).

Can't help you with advice on whether you can afford it!

tim

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Basic details:

1. STR'd in 2008

2. Currently renting in a prime London suburb

3. Good deposit, so can get the super deals (i.e. lifetime tracker @ base + 1.69% (2.19%))

4. Just found a house in the area (5 bed, 2 bath, ok-ish sized garden) that is not perfect , but is a good compromise (big, right area, etc.). Would need to spend a few hundred thousand pounds over our budget to get perfection round here, sadly.

4. Had our initial offer rejected (2.1x joint salary)

Thinking of going back with an a final offer of 2.5x joint, leaving 6 months cash for emergencies. This would then become a max of 3.8x single in 9 months, assuming the Mrs immediately gets pregnant. We would still have the 6 months contingency, although refurb costs would be need to be found (repaint, kitchen, bathroom, though a lot of this we could do ourselves with advice from family).

I've assumed base rates rise by 2% per year up to a max of 8.2%, so our average rate over the life of the mortgage is 7%. Excluding pay rises/bonuses and partner's income (if my wife returns to work at all), the single multiple will be 3.4x in 2 years and 2.9x in 5 years.

Both jobs are stable. Mine is finance-based, but is not exposed to government cuts, health of the banks or GDP fluctuations.

Thoughts?

Wouldn't it be wiser to just make your own judgement rather than relying on some anonymous person on a website?

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So your second offer is 20% higher that your first?

Either your first offer was insulating (so it's not surprising it was rejected) or your second offer is too high. (As a guide the difference between what I have just offered on a house and the counter offer from the vendors is 7% and I've dedcided to decline that as too high).

Can't help you with advice on whether you can afford it!

tim

Not quite 20%, but a decent guess Tim! You're right, the initial offer was very low.

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Wouldn't it be wiser to just make your own judgement rather than relying on some anonymous person on a website?

I've built a comprehensive cash flow model, but often I find it helpful to throw out a topic for general discussion. People think through problems in a different way, or have a different perspective, so maybe I'll pick up something I've missed. No harm in asking!

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I've built a comprehensive cash flow model, but often I find it helpful to throw out a topic for general discussion. People think through problems in a different way, or have a different perspective, so maybe I'll pick up something I've missed. No harm in asking!

I wasn't having a go..but in my experience if you are making a big decision its much easier to live with it if it goes tits up

if you're the one that has made it...whilst people here may be able to grasp the finances of what you're talking about they

will not have any idea of the psycho-dynamics (if I can be so pompous..) of your personal situation/character, and you

buying a home or not is not going to be all about money, I'm sure you have other reasons as well.

To finish..I wish you all the best with whatever you decide and if you want this house I hope you get it (and at a good price!).

Good luck!

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If you feel it's the right time and you don't mind losing any money in the possible crash, then go for it.

I would have love to have bought sooner, but my job is insecure so I can't risk it. I believe that the 'still living the parents' factor was part of the reason my GF of 7 years ended it with me, but she's always been spoilt and thinks this saving business is easy.

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Basic details:

1. STR'd in 2008

2. Currently renting in a prime London suburb

3. Good deposit, so can get the super deals (i.e. lifetime tracker @ base + 1.69% (2.19%))

4. Just found a house in the area (5 bed, 2 bath, ok-ish sized garden) that is not perfect , but is a good compromise (big, right area, etc.). Would need to spend a few hundred thousand pounds over our budget to get perfection round here, sadly.

4. Had our initial offer rejected (2.1x joint salary)

Thinking of going back with an a final offer of 2.5x joint, leaving 6 months cash for emergencies. This would then become a max of 3.8x single in 9 months, assuming the Mrs immediately gets pregnant. We would still have the 6 months contingency, although refurb costs would be need to be found (repaint, kitchen, bathroom, though a lot of this we could do ourselves with advice from family).

I've assumed base rates rise by 2% per year up to a max of 8.2%, so our average rate over the life of the mortgage is 7%. Excluding pay rises/bonuses and partner's income (if my wife returns to work at all), the single multiple will be 3.4x in 2 years and 2.9x in 5 years.

Both jobs are stable. Mine is finance-based, but is not exposed to government cuts, health of the banks or GDP fluctuations.

Thoughts?

If you're happy risking losing a shed load of equity and believe you can pay the mortgage, whatever happens to interest rates (when I say whatever I mean if they go to 20% plus - not impossible), then go for it. But what is the harm in waiting to see how things pan out over the next few months? I think you'll be quids in if you do.

An anecdotal for you, my cousin works in high end real estate, channelling repossessed properties from the banks to sell to rich clients. Just had a chat to him. Apparently, there is a huge backlog the banks won't realise, cos obviously it'll crash the market and everyone will know the emperor has no clothes. Think prices can stay up forever? IMO when this thing blows it'll blow big, just like the US market. Be careful not to leave yourself to hang out to dry.

Edited by General Congreve

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If that feels right for you, why would you care about anything else? Affordability is the concern if you buy a house. Value is the concern when you make an investment.

Basic details:

1. STR'd in 2008

2. Currently renting in a prime London suburb

3. Good deposit, so can get the super deals (i.e. lifetime tracker @ base + 1.69% (2.19%))

4. Just found a house in the area (5 bed, 2 bath, ok-ish sized garden) that is not perfect , but is a good compromise (big, right area, etc.). Would need to spend a few hundred thousand pounds over our budget to get perfection round here, sadly.

4. Had our initial offer rejected (2.1x joint salary)

Thinking of going back with an a final offer of 2.5x joint, leaving 6 months cash for emergencies. This would then become a max of 3.8x single in 9 months, assuming the Mrs immediately gets pregnant. We would still have the 6 months contingency, although refurb costs would be need to be found (repaint, kitchen, bathroom, though a lot of this we could do ourselves with advice from family).

I've assumed base rates rise by 2% per year up to a max of 8.2%, so our average rate over the life of the mortgage is 7%. Excluding pay rises/bonuses and partner's income (if my wife returns to work at all), the single multiple will be 3.4x in 2 years and 2.9x in 5 years.

Both jobs are stable. Mine is finance-based, but is not exposed to government cuts, health of the banks or GDP fluctuations.

Thoughts?

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In your position (how supercillious does that sound) I would give it another six months.

Interest rates, bank bailouts (more to come), recent drops (of record proportions, but may turn out to be an anomaly), civil unrest, global de-leveraging...

But then people have been saying that for six years.

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In your position (how supercillious does that sound) I would give it another six months.

Interest rates, bank bailouts (more to come), recent drops (of record proportions, but may turn out to be an anomaly), civil unrest, global de-leveraging...

But then people have been saying that for six years.

Ta!

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I wasn't having a go..but in my experience if you are making a big decision its much easier to live with it if it goes tits up

if you're the one that has made it...whilst people here may be able to grasp the finances of what you're talking about they

will not have any idea of the psycho-dynamics (if I can be so pompous..) of your personal situation/character, and you

buying a home or not is not going to be all about money, I'm sure you have other reasons as well.

To finish..I wish you all the best with whatever you decide and if you want this house I hope you get it (and at a good price!).

Good luck!

Thanks!

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If you're happy risking losing a shed load of equity and believe you can pay the mortgage, whatever happens to interest rates (when I say whatever I mean if they go to 20% plus - not impossible), then go for it. But what is the harm in waiting to see how things pan out over the next few months? I think you'll be quids in if you do.

An anecdotal for you, my cousin works in high end real estate, channelling repossessed properties from the banks to sell to rich clients. Just had a chat to him. Apparently, there is a huge backlog the banks won't realise, cos obviously it'll crash the market and everyone will know the emperor has no clothes. Think prices can stay up forever? IMO when this thing blows it'll blow big, just like the US market. Be careful not to leave yourself to hang out to dry.

[GULP!]

Yes, I think I'll have another think.

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If you feel it's the right time and you don't mind losing any money in the possible crash, then go for it.

I would have love to have bought sooner, but my job is insecure so I can't risk it. I believe that the 'still living the parents' factor was part of the reason my GF of 7 years ended it with me, but she's always been spoilt and thinks this saving business is easy.

I'm sorry to hear that PB. All because of bloody house prices :angry:

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Wouldn't it be wiser to just make your own judgement rather than relying on some anonymous person on a website?

I think you should read monty's previous posts. I think he is pretty savvy not least because, from memory, he got out at the top of the market..... :rolleyes:

Edited by Buffer Bear

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3. Good deposit, so can get the super deals (i.e. lifetime tracker @ base + 1.69% (2.19%))

I've just got that HSBC deal and the solicitors are doing their thing. Found a forced seller that dropped £25K after a month and have gone for it. Small house, big plot with lots of potential. Gone for a 2.5x single income mortgage but will have ~2x in savings earning ~5% tax-free whilst paying the mortgage at 2.19%.

After waiting 7 years, and being 40+, I'm sick of renting, having to ask permission to do anything. Savings interest has paid the rent of the last 7 years so have done well out of it, buying in now at £53K lower than I sold for to get a similar place. Can't find a better house for £100k more than I will be paying.

May as well increase the offer slowly, send the vendor a letter directly saying why prices are falling and their house is only worth £xxx.

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  • 149 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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