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I live in zone 3 London and I want to buy a three bed house for a max budge of £300,000. My mortgage will be about £1000 per month. I am FTB.

I am worried what the future brings, especially when my mortgage will be £1000 and future interest rate rises.

Should I just keep saving and buy later or buy now?

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I would advise you to borrow as much money as you can and buy the most expensive place you can get.

Don't worry about interest rates as they only ever go down and house prices only ever rise.

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I live in zone 3 London and I want to buy a three bed house for a max budge of £300,000. My mortgage will be about £1000 per month. I am FTB.

I am worried what the future brings, especially when my mortgage will be £1000 and future interest rate rises.

Should I just keep saving and buy later or buy now?

Looks like you answered it yourself.

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I would advise you to borrow as much money as you can and buy the most expensive place you can get.

Don't worry about interest rates as they only ever go down and house prices only ever rise.

Dad??

Is that you?

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I was joking, I think everyone here has decided that the game is rigged so flip a coin.

The thing is if the government can rig house price higher you will win, but if the can't then you lose.

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I was joking, I think everyone here has decided that the game is rigged so flip a coin.

The thing is if the government can rig house price higher you will win, but if the can't then you lose.

Indeed. I flip a coin every day.... and then ignore the answer and stick the coin in my piggy bank! Just give a another 20 years, I'll get that deposit someday :P

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Don't worry about interest rates as they only ever go down and house prices only ever rise.

Wow, can I borrow your crystal ball? Or perhaps Carney's your mate?

Edit: Well, on the interest rate bit anyway......

Edited by AThirdWay

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The mortgage rate for me would be roughly 3.1%. If the BOE raises rates back to 4.5% then my mortgage repayments would be roughly £1700. Very worrying!!!

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The mortgage rate for me would be roughly 3.1%. If the BOE raises rates back to 4.5% then my mortgage repayments would be roughly £1700. Very worrying!!!

WHEN, not "if".

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The reality is that no-one else can answer the question for you. The answer depends on your own circumstances, your expectation of the spread of possible futures (What is likely/possible to be happening in your own life in five, ten, twenty years? What is likely/possible to be happening in the economic/social/political spheres? What are your estimates of the probabilities of these?), how much you have to lose and, maybe most importantly, your own attitude to risk.

You have started doing this by considering base rates at 4.5%. What if they were 8%? How about 15%? What if you lose your job? Do you have children? If not, might you have in future? What if they all happen together (and what likelyhood do you assign to this)?

Basically, whatever you do you need to be able to look back in whatever future transpires and be happy that you made the decision you did. It might be a case of: "Well I took a bit of a punt and it didn't pay off, but I knew what the risks were and I'm still glad I took the opportunity." Remember risks go both ways, maybe you really will "Miss out on the property ladder forever if you don't buy now" (personally, I'm sceptical). It's your call.

This may seem obvious and apply to any decision in life, and that's true. The difference in housing is that the current astronomical prices* involved mean that the risks of getting it wrong are so large and life becomes a crap-shoot around the outcome of a single decision. In buying, the extreme scenario is the loss of everything you have ever accumulated (assuming a fairly non-elite background) and a lifetime on indentured debt servitude. In not buying, the extreme scenario is essentially an unfulfilled life, if having a hidey-hole of "your own" is for you a strong, base yearning without which you feel lost (as most people do).

* I don't know how much you earn, but work out the following calculation. Take your wages, after tax, for a year. Divide through £300,000 by this number. The result is the number of years of your labour (your life) that you are agreeing to forsake to own that house. That is to say even without eating, heating your new home, looking to its upkeep, doing anything for yourself, you would need to work for that many years for the sole benefit of the vendor of that property. The problem with numbers of pounds is that once you get beyond numbers that you can reasonably picture as a bundle of tenners, it can just seem like, well, a load of numbers. If you conceptualise it as years of toil, I find it seems much more real. How this relates to the original point is that this is your "stake" that is on the line when spending that much money on a house. That doesn't mean you should or shouldn't do it if you are happy with the ramifications, just go in with your eyes open.

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The mortgage rate for me would be roughly 3.1%. If the BOE raises rates back to 4.5% then my mortgage repayments would be roughly £1700. Very worrying!!!

That's the point where you scream "misselling" and insist on compensation.

Alternatively, start investing in the real economy. I'm in my fifth year of building a high-income portfolio, and on target to cover my rent with something to spare this year.

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The mortgage rate for me would be roughly 3.1%. If the BOE raises rates back to 4.5% then my mortgage repayments would be roughly £1700. Very worrying!!!

You can fix the mortgage rate for five years at less than 3%, or for ten years at less than 4% at the moment, if that helps. I certainly would not contemplate having anything less than a five-year fixed rate at any point in the cycle unless the monthly payments were going to be a pretty trivial proportion of my income at all foreseeable rates.

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This particular thread and the questions asked demonstrate quite clearly the crap most of this country finds itself in..........

...........indeed it shows the reason this site exists...........

..........in the past people were persuaded (conned) into buying property

..................because interest rates don't change, overheads (bills) don't rise, and property always goes up :blink:

outside of London this was clearly a lie :angry:

inside of London this is still a BIG risk :o

.....remember an awful lot of people OWE far more than their property can realise :o

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