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Save me from the madness!

I still can't believe how high house prices are

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I'm still in awe at how house prices stay as they are (and even increase in many areas). Financially I'm in a better position earning wise and self earned savings then many of my peers, yet I still feel priced out of the 4 bedroom housing market in South Manchester. I really don't get where people get the money from, I realise some people get large inheritances but surely that alone can't be propping up family homes (and surely inheritance from an average life expectancy comes to late to be useful for buying a family home)? Even when the monthly mortgage looks nicely affordable at say £600 per month of say £2600 monthly take home, when all the other bills, and savings for maintenance items, rising food costs there's not as much slack as I'd like to rebuild our savings (our food bill must be close to £600 per month).

My wife and I are due another child and as all the bedrooms are full we're exploring options. A loft conversion is something we can easily afford having overpaid on our mortgage, but it doesn't fix all the issues with going from 2 to 3 kids:

- we lose a large chunk of our main storage space, it is hard being a minimalist with kids.

- our back garden is modest so doesn't lend itself to having a large shed for storage space, and ideally I'd like it twice the size, though ironically it is bigger then most new builds in our level of property.

- our kitchen is of a size that only a small fridge and small freezer can be fitted inside (we have a big fridge freezer in the garage). As the kids get bigger and eat more I can see a stress point here. (I know, first world problem, but very real for me as the wife already gets stressed with it to a level that then effects me with our current two young kids)

Financially we're currently in an amazing position due to a dash of luck, and my cautious and modest nature and in our late 30's effectively own our house outright (we have an offset with the balance in waiting for the fixed rate period to expire later this year). As another option I looked at moving house. Sadly in my area, I have to be willing to borrow an additional £100,000 to get a place even worth considering about moving into which would better then our loft being converted by enough of a margin to make it worthwhile. Annoyingly though, a house I've walked past many times and thought was beautiful and would love to live in for years has come on the market but would require a mortgage of around £135,000, it's not perfect, but would fit the build with options for storage in the garden due to it's big size. The trouble is I'd be signing myself up to paying a mortgage into my early 60s which I view as a risk as I work in IT and am concerned about assuming I will still be able to work at this level of pressure for another 25 years is a good idea (mind you, 15+ years from now £600 per month may well be affordable to a minimum wage salary, perhaps I'm worrying too much). My eldest child is 5, and I have a feeling that they only get more expensive for entertainment activities, etc and maybe helping with large items like learning to drive and helping with insurance for a banger etc).

The whole situation really naffs me off. I admit I'm whinging and am in a better position then many, but I return to the original question of how with the very fortunate position I am in, does buying a spacious 4 bed detached house (no ensuite though so it's not palatial) with a medium+ size garden (say somewhere between 5-a-side and footy pitch size) become a stretch when all living expenses are considered.

 

</ first world rant off>

 

 

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Why the big aspiration to have paid off the mortgage on a 4 bed house in time for retirement? 

Think outside the box. Keep the current house. Get bunk beds drop a day a week from work have more time for the kids. They'll love you more for that and have better childhoods.

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"Why the big aspiration to have paid off the mortgage on a 4 bed house in time for retirement? "

in my case to own my own home and not be at the mercy of landlords who can throw me out any time they wish, be able to improve my own home as I wish to, do what I want in the garden and to give my kids stability and not be mover around from house to house

in an era where people are living longer who knows how long I will live ?  If I live to say 90-95 and retire at 60 that would be £360,000 in rent assuming £1,000 a year which is way below what I would pay for a comparable home - ( in today's money the reality is that would be about £2,000 a month )

I live in Surrey and love living here this is where I intend to stay as my kids, mates, hobbies and interest are all here 

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3 hours ago, Si1 said:

Why the big aspiration to have paid off the mortgage on a 4 bed house in time for retirement? 

Think outside the box. Keep the current house. Get bunk beds drop a day a week from work have more time for the kids. They'll love you more for that and have better childhoods.

Thanks Si1, that's an interesting option to throw into the mix. I could even do the loft extension and still do the reduce to 4 day a week and spend a bit of that day keeping the house working, and a bit of that day doing exercise / hobbies. Something to mull over. I also suspect that as my maximum affordable offer would be £20,000 under the asking price it will be rejected anyway. When I put the same price into a town on the North side of Manchester there are amazing houses for that price but that would mean leaving friends and family behind which is just too big a price for me.

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1 hour ago, happyguy said:

"Why the big aspiration to have paid off the mortgage on a 4 bed house in time for retirement? "

in my case to own my own home and not be at the mercy of landlords who can throw me out any time they wish, be able to improve my own home as I wish to, do what I want in the garden and to give my kids stability and not be mover around from house to house

in an era where people are living longer who knows how long I will live ?  If I live to say 90-95 and retire at 60 that would be £360,000 in rent assuming £1,000 a year which is way below what I would pay for a comparable home - ( in today's money the reality is that would be about £2,000 a month )

I live in Surrey and love living here this is where I intend to stay as my kids, mates, hobbies and interest are all here 

I'm glad to see basic innumeracy hasn't died a death yet.

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Shuda stuck to 1 child, friendo. Those 3 kids are gonna cost you A LOT more than you think. I'd try and reduce the food bill, too. You should be fine, the majority of the WORKING class don't realise yet that they cannot afford the luxury of children.

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23 hours ago, Save me from the madness! said:

[ ...] how with the very fortunate position I am in, does buying a spacious 4 bed detached house (no ensuite though so it's not palatial) with a medium+ size garden (say somewhere between 5-a-side and footy pitch size) become a stretch when all living expenses are considered. [...]

It's because the UK's belief in a "free and open housing market" means that you are made to compete with offshore oligarchs for said house.

Anyone from anywhere in the world can buy UK property, which has a fixed supply and is protected by our prized legal system.  But just you try buying an apartment in Moscow or Shanghai.  You can't do it unless you're a local or married to a local.

The UK's mistaken belief in free markets in everything means that the entire world gets to own our property and keep the rental income tax free and offshore.  You can't do the same in reverse, because you don't have a stolen or sovereign or inherited multi-billion fortune.  You also aren't trying to hide your wealth out of the reach of, say, the Chinese communist government - who robbed the middle classes of all their wealth in living memory under Chairman Mao.

So the answer is you're being squeezed by Gulf royalty, Russian oligarchs and Chinese billionaires desperate to keep their fortunes in a safe jurisdiction.  And successive governments have cheered this on in the name of "freedom".

Get used the freedom, slave!

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2 minutes ago, Freezer? Best place for it said:

Despite the obvious typo, the housing market is not remotely a free market.  The biggest fiddler is the UK government.

Yeah sorry about the typo.  Can't work out how to edit or delete posts here.  Newbie doofus error.

And yes, the UK government is the most absurd hypocrite: "we believe in open & free markets, so here's a bailout of the banks and Help To Buy to prop up an overpriced property market."  So they preach free markets, misunderstand free markets and then do the exact opposite.  Not just a bit opposite.  Not even 179 degrees opposite.  Absolutely, precisely opposite.

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19 hours ago, simonj said:

Those 3 kids are gonna cost you A LOT more than you think.

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

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On ‎06‎/‎01‎/‎2018 at 1:51 PM, dugsbody said:

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

Oh lots of things contribute. I think costs on a per child basis will be less. Overall costs will be higher due to differences where the default of two children is catered for well, but not so much 3+ resulting in a premium i.e. car, most cars fit 2 kids well, less so 3 kids permanently unless you get a bigger one. Holidays can be quite a big one... Premier Inn for example can cater for 2 adults, 2 kids in a family room very cheaply. however, 3 kids would mean 2 rooms need to be hired; flights in premium holiday periods obviously add a lot to the cost and eating out. Housing potentially if a bigger house is bought. Helping your child get a start in life whether that be helping them buy and insure a car when they get a job or help subsidise their accommodation costs for a year or two if they get an apprenticeship.

Financially, in Western countries, three kids+ makes no sense (mind you, you could make the same argument for 2+ also). However, there is more to life than finance which seems to dominate our lives far too much for my liking. Increasingly I find the wider country and environment an unwelcoming, harsh and soulless place. With my kids though, I can create a loving and friendly environment, and once they've grown up, hopefully I can have a lot of fun with plenty of Grandkids with a lot of joy and purpose to my life. I can't change the world, but I can change my world.

Thankfully my wife and I are not that materialistic, so if it means a life of continuing to not have fancy clothes and not being seen very often at all in trendy places so be it. At the end of my life I won't have regrets about not dressing in more fashionable clothes and holidayed less in Cornwall, and more in Monaco.

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On 06/01/2018 at 1:51 PM, dugsbody said:

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

Just keep a meticulous list of everything you spend on or related to the children. Keep the list for 5 years and see what the figure is the end of the period. That will provide your answer.

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On 06/01/2018 at 1:51 PM, dugsbody said:

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

The cost of childcare is mind-blowing, it will be cheaper to send my child to private school than nursery. Parents of 1-2 yrs paying hugely increased fees for the "free" 3+ yrs apparently. 

Beyond that the basics for parenting seem to be quite cheap for the most part. When I look at mates with older kids it's all self inflicted. Holidays to Florida, night time activity clubs each and every day etc etc

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On 06/01/2018 at 11:28 AM, Sneaker said:

Yeah sorry about the typo.  Can't work out how to edit or delete posts here.  Newbie doofus error.

And yes, the UK government is the most absurd hypocrite: "we believe in open & free markets, so here's a bailout of the banks and Help To Buy to prop up an overpriced property market."  So they preach free markets, misunderstand free markets and then do the exact opposite.  Not just a bit opposite.  Not even 179 degrees opposite.  Absolutely, precisely opposite.

I wouldn't object so much to the cuts in services etc if it weren't for the naked support of connected corporate VIs like this.

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On 06/01/2018 at 1:51 PM, dugsbody said:

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

To be honest coming from a large family, mum at home whilst all young, hard working dad.....two or four or even five don't make that much difference......sharing bedrooms with three of us teaches to share (bunk beds), great company, lots of banter, arguments and companionship.......we had hand-me-downs, shared toys, games, played together, fought together and walked together......the house was always full of kids from down the road....we did not expect to be brought the expensive branded clothes and shoes, what we lacked in stuff we gained in our parents time spent with us, and love of us.......we understood when told could not buy this or that and appreciated it more from waiting and saving for something, earning our own pocket money when older, washing cars, small errands, taking people's washing to the launderette, paper round, etc......doing small jobs, Saturday work, been doing that ever since.....;)

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On 06/01/2018 at 1:51 PM, dugsbody said:

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

Childcare costs can be ruinous - my daughter's paying a fortune for her two under 3s 4 days a week.  That will get easier from that POV, but from experience kids do get a lot more expensive as they get older.  School uniforms, school trips, endlessly growing out of shoes and clothes, all the clothes and gadgets (nowadays) they want 'because everyone else has one',  all the activities - swimming/football/rugby/gymnastics/ballet/music lessons, etc., more expensive school trips as they get older, family holidays - if you're able to afford them...

And then, if they go, there's university....

All the stuff you need for the first baby - most of which you can get 2nd hand anyway, as my daughter did, is the least of it IMO. 

 

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On 06/01/2018 at 1:51 PM, dugsbody said:

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

Nursery care is ruinously expensive. My son is in an excellent central London nursery and the fees are substantially in excess of what the average non-boarding private school charges. The main factors behind this are:

  1. It's very labour-intensive, with regulations specifying the maximum number of children under 2 per minder (3 children)
  2. Rent on premises is expensive, obviously more so in central London
  3. Increased provision of free care for children in 3+ bracket combined with inadequate government funding means that those not eligible have to subsidise these free places.

On the plus side, once they hit primary age, if you're a flexible renter, you can move into a catchment of an excellent state primary and get same quality education as you'd get in a good private school for free.

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House prices are not the problem - childcare is. It's how they screw you in the UK.Mortgage? 720 pcm . Nursery? 900 pcm (one child).  ...and when they go to school... after-school .

Ripoff.

Childcare should be 100% "free" (as in, funded by the taxpayer) simply because the government will then tax those children (when they grow up and start working). Leaving things as they are will result in an aging population, forcing the government to "import" more people. As a migrant myself, I don't generally mind it, but I find it stupid. On one hand "brexit, we're full"...on the other hand "900 pcm if you want to have a child". You can't have it both ways.

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16 hours ago, flb said:

House prices are not the problem - childcare is. It's how they screw you in the UK.Mortgage? 720 pcm . Nursery? 900 pcm (one child).  ...and when they go to school... after-school .

Ripoff.

Childcare should be 100% "free" (as in, funded by the taxpayer) simply because the government will then tax those children (when they grow up and start working). Leaving things as they are will result in an aging population, forcing the government to "import" more people. As a migrant myself, I don't generally mind it, but I find it stupid. On one hand "brexit, we're full"...on the other hand "900 pcm if you want to have a child". You can't have it both ways.

Or, in other words, subsidised by people who don't have children.

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1 hour ago, RentingForever said:

Or, in other words, subsidised by people who don't have children.

The poster addressed that point directly after the bit you highlighted.

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On 6 January 2018 at 1:51 PM, dugsbody said:

I'm always curious to hear others opinions about this. What do you think makes it so expensive? Child-care / partner not working is the biggest imo.

We've got 3 lads, all grown up now. Biggest  expenses are food, shoes (3 @ twice a year plus trainers), phone contracts in a few years time, eating out (everything times 5), perhaps a larger car than you might otherwise have had.

if your eldest is 5 it's only going to be 12 years before they will be thinking about uni and leaving home (although they may well boomerang back of course ?).

Our biggest expense by far was fully funding them through uni........ Over £100k for 2 doctors and a chartered surveyor (could have bought a BTL for cash for that much).

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  • 407 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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