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2 hours ago, Harry96 said:

Guys I need some advice. I’m 24 and I currently live with just my mum and have been paying towards the mortgage for 3 years or so. Things are difficult at the home and I think it’s time I bought my own place, I have a decent amount saved up and looking at a 2 bed house to get onto the property ladder. However my earnings are only around 20k mark and am I right in saying you can only a house which costs up to 4x within your salary? And that wouldn’t leave me with a lot of options. Pretty much ain’t got a clue with this sort of thing so any advice would be much appreciated. Thanks 

As suggested have a good look at comparison calculators

 

https://www.moneysavingexpert.com/mortgages/how-much-can-i-borrow/

 

How much will depend on salary, term of mortgage and current financial commitments.

 

With Santander, a salary of £20k, no outgoings and a £10k deposit it's £89k if you went to 30 year term. https://www.santander.co.uk/personal/mortgages/mortgage-calculators/how-much-could-i-borrow

 

Good for you in getting prepared to be a homeowner,

 

I wondered what was available house wise for up to £90k, I know prices are higher in Leicestershire from my own new home search compared to where I am, but I was quite shocked. £80-90k would get you a good 3 bed terrace or semi here. The houses that looked reasonable were actually the shared ownership price :o

Mind, considering £200k would buy you a 4 bed detached in NI I'm not sure why I was surprised!

 

 

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6 hours ago, Harry96 said:

Guys I need some advice. I’m 24 and I currently live with just my mum and have been paying towards the mortgage for 3 years or so. Things are difficult at the home and I think it’s time I bought my own place, I have a decent amount saved up and looking at a 2 bed house to get onto the property ladder. However my earnings are only around 20k mark and am I right in saying you can only a house which costs up to 4x within your salary? And that wouldn’t leave me with a lot of options. Pretty much ain’t got a clue with this sort of thing so any advice would be much appreciated. Thanks 

I would start shopping around for some Mortgage in Principles (or Agreement in Principle [AIP]) with some major lenders to get a proper idea of how much you can borrow. Many of these will check you are eligible with a soft credit check, but i would still do as much as possible to get your credit score up as much as you can. Your current account provider may be a good place to start. Once you have an AIP you can start property searching with a bit more confidence in what you can afford. Or it may come out that you can’t afford it yet; but at least you’ll know!

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58 minutes ago, Harry96 said:

Ok thanks guys appreciate all your help 

Good luck Harry…. Post on this thread if you have any questions…

 

Enjoy it…. I remember getting the keys to my first house and it was a great feeling!!!

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https://www.savills.co.uk/insight-and-opinion/savills-news/311749-0/savills-upgrades-uk-house-price-forecasts

 

Obviously take these with a pinch of salt, but they aren't predicting a drop anytime soon. I'll put East Midlands predictions below for those that cba to click the link.

 

East Midlands:

Year 1 - 4.5% rise.

Year 2 - 5.5% rise.

Year 3 - 5.0% rise.

Year 4 - 4.0% rise.

Year 5 - 3.0% rise.

 

They predict a 24% rise in 5 years, but the total of those adds up to 22% so not sure what's going on there lol

 

 

           
Edited by Leicester_Loyal
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7 minutes ago, Leicester_Loyal said:

https://www.savills.co.uk/insight-and-opinion/savills-news/311749-0/savills-upgrades-uk-house-price-forecasts

 

Obviously take these with a pinch of salt, but they aren't predicting a drop anytime soon. I'll put East Midlands predictions below for those that cba to click the link.

 

East Midlands:

Year 1 - 4.5% rise.

Year 2 - 5.5% rise.

Year 3 - 5.0% rise.

Year 4 - 4.0% rise.

Year 5 - 3.0 rise.

 

They predict a 24% rise in 5 years, but the total of those adds up to 22% so not sure what's going on there lol

 

 

           

Compound interest, presumably.

 

I honestly wouldn't be surprised with how much things are changing at the moment.

Edited by ajthefox
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What are peoples opinions on shared ownership schemes?

 

Example is Crest Nicholson do something called Home Reach where you buy 50% of the house and rent the other half, only 5% deposit required and you are able to increase your ownership over time up to the full 100%

 

https://www.crestnicholson.com/offers/home-reach

 

Is it something worthwhile doing for single income first time buyers or just a rip off to get more money out of you?

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18 minutes ago, Leicester_Loyal said:

Submitted an offer for a property yesterday evening, and the EA was ringing me early doors this morning asking for my best offerlol I've just said you've had my offer, please let me know if it's accepted or rejected.

Fingers crossed for you, you really need a slice of luck on a house, it's been terrible thus far - translate to all the agents you've dealt so far with have been utter sh!ts...

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3 minutes ago, moore_94 said:

What are peoples opinions on shared ownership schemes?

 

Example is Crest Nicholson do something called Home Reach where you buy 50% of the house and rent the other half, only 5% deposit required and you are able to increase your ownership over time up to the full 100%

 

https://www.crestnicholson.com/offers/home-reach

 

Is it something worthwhile doing for single income first time buyers or just a rip off to get more money out of you?

I read up on this a few days ago because someone I know was debating buying a 50% shared ownership. Basically it can either go really well or be your worst nightmare. I'd avoid it myself, but obviously it's dependant on your circumstances.

 

1 minute ago, FoyleFox said:

Fingers crossed for you, you really need a slice of luck on a house, it's been terrible thus far - translate to all the agents you've dealt so far with have been utter sh!ts...

Here's hoping mate, been almost 10 months of searching now, so it'll be nice for it to finally come to an end.

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2 hours ago, Leicester_Loyal said:

https://www.savills.co.uk/insight-and-opinion/savills-news/311749-0/savills-upgrades-uk-house-price-forecasts

 

Obviously take these with a pinch of salt, but they aren't predicting a drop anytime soon. I'll put East Midlands predictions below for those that cba to click the link.

 

East Midlands:

Year 1 - 4.5% rise.

Year 2 - 5.5% rise.

Year 3 - 5.0% rise.

Year 4 - 4.0% rise.

Year 5 - 3.0% rise.

 

They predict a 24% rise in 5 years, but the total of those adds up to 22% so not sure what's going on there lol

 

 

           

Year 2 is not a 5.5% rise of the base value, but a 5.5% rise of the base value, plus 4.5%.

 

Year 3 is a 5% rise of the base value, plus 4.5%, than with another 5.5% rise added. 
 

etc.

 

Does that make sense?

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45 minutes ago, Leicester_Loyal said:

Submitted an offer for a property yesterday evening, and the EA was ringing me early doors this morning asking for my best offerlol I've just said you've had my offer, please let me know if it's accepted or rejected.

Fingers crossed! We have all been looking forward to the house warming for months now..!

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1 hour ago, moore_94 said:

What are peoples opinions on shared ownership schemes?

 

Example is Crest Nicholson do something called Home Reach where you buy 50% of the house and rent the other half, only 5% deposit required and you are able to increase your ownership over time up to the full 100%

 

https://www.crestnicholson.com/offers/home-reach

 

Is it something worthwhile doing for single income first time buyers or just a rip off to get more money out of you?

I'm not sure how the figures stack up in terms of the rip off you mention, but my only opinion is based on my mates experience. Single parent who got divorced, limited borrowing capacity but needed a house large enough for the family. By utilising the shared ownership scheme it meant being able to buy a larger house than was possible using mortgage lending/affordability. It's probably advantageous if you've a fluctuating but regular income like overtime etc, if the lender won't include it for mortgage purposes, but it would cover the rental portion.

 

It's often mentioned that rent can more than a mortgage on an equivalent house, but if the lender won't allow you the x salary or include all of your income to the borrowing level you can't buy it.

 

If you're on a fixed salary, there's good reason to be prudent, they don't want you in financial difficulty but if your income isn't in the 'salary' box it's a challenge. Our lender just rejected 3 of our income sources as they're not in the salary box!

Edited by FoyleFox
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44 minutes ago, moore_94 said:

What are peoples opinions on shared ownership schemes?

 

Example is Crest Nicholson do something called Home Reach where you buy 50% of the house and rent the other half, only 5% deposit required and you are able to increase your ownership over time up to the full 100%

 

https://www.crestnicholson.com/offers/home-reach

 

Is it something worthwhile doing for single income first time buyers or just a rip off to get more money out of you?

one of my friends has just done this in Ashby with Crest Nicholson. 

 

Makes sense if in the future you can buy more of a share in the property from CN.  "staircasing" your ownership means you at least get to keep more of the upside if the property increases in value, especially if your circumstances or earnings improve. 

 

is it perfect? no.  But then options are limited for a single income first time buyer if you don't want to buy a flat. (which I would avoid doing personally)

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1 hour ago, Leicester_Loyal said:

Here's hoping mate, been almost 10 months of searching now, so it'll be nice for it to finally come to an end.

Fingers crossed for you.

Can I ask did you have to keep reapplying for your mortgage in principle? If so have you done this with the same lender?

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32 minutes ago, me_plus_one said:

Fingers crossed for you.

Can I ask did you have to keep reapplying for your mortgage in principle? If so have you done this with the same lender?

I've only had an offer accepted on one property that fell through, obviously there I had agreed a mortgage in principle, but with the rest of the bids, I just put them forward without have a MIP in place. Some estate agents want to see proof of a MIP before they'll even let you bid, in that case I provided proof of deposits with bank statements and gave them my mortgage brokers number and he spoke to them. It's utterly pointless agreeing a MIP for the vendor to knock back my bid, just a waste of everyones time, but it seems to be a common theme that EA are asking for now, so not sure if it's so they can send you to their mortgage advisors?

 

I think also if you agree a MIP for a certain amount, but then you end up increasing your bid, you have to get a whole new MIP, which could be an issue if you're applying for multiple mortgages over a short period of time, but the mortgage advisors on here will know more than me.

 

Will keep you all posted if anything changes, thanks for the kind words.

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20 minutes ago, Leicester_Loyal said:

I've only had an offer accepted on one property that fell through, obviously there I had agreed a mortgage in principle, but with the rest of the bids, I just put them forward without have a MIP in place. Some estate agents want to see proof of a MIP before they'll even let you bid, in that case I provided proof of deposits with bank statements and gave them my mortgage brokers number and he spoke to them. It's utterly pointless agreeing a MIP for the vendor to knock back my bid, just a waste of everyones time, but it seems to be a common theme that EA are asking for now, so not sure if it's so they can send you to their mortgage advisors?

 

I think also if you agree a MIP for a certain amount, but then you end up increasing your bid, you have to get a whole new MIP, which could be an issue if you're applying for multiple mortgages overs a short period of time, but the mortgage advisors on here will know more than me.

 

Will keep you all posted if anything changes, thanks for the kind words.

Comprehensive response thank you.

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6 hours ago, Leicester_Loyal said:

https://www.savills.co.uk/insight-and-opinion/savills-news/311749-0/savills-upgrades-uk-house-price-forecasts

 

Obviously take these with a pinch of salt, but they aren't predicting a drop anytime soon. I'll put East Midlands predictions below for those that cba to click the link.

 

East Midlands:

Year 1 - 4.5% rise.

Year 2 - 5.5% rise.

Year 3 - 5.0% rise.

Year 4 - 4.0% rise.

Year 5 - 3.0% rise.

 

They predict a 24% rise in 5 years, but the total of those adds up to 22% so not sure what's going on there lol

 

 

           

Estate agent predicts a house price rise.... shock :jawdrop:

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5 hours ago, moore_94 said:

What are peoples opinions on shared ownership schemes?

 

Example is Crest Nicholson do something called Home Reach where you buy 50% of the house and rent the other half, only 5% deposit required and you are able to increase your ownership over time up to the full 100%

 

https://www.crestnicholson.com/offers/home-reach

 

Is it something worthwhile doing for single income first time buyers or just a rip off to get more money out of you?

If you can afford to buy your own place outright then I would do that but otherwise it’s a good way to get a foot on the ladder, if prices rise in a few years you could sell that and with your share of the equity put a full deposit down.

 

I think the rent payments work out to be quite high though. Would depend on how desperate you are to get your own place, I would personally weigh up how long it takes you to raise the extra deposit v that.

Edited by Costock_Fox
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21 hours ago, Leicester_Loyal said:

Submitted an offer for a property yesterday evening, and the EA was ringing me early doors this morning asking for my best offerlol I've just said you've had my offer, please let me know if it's accepted or rejected.

Woke up to an email this morning saying the vendor wants a Mortgage In Principle arranging before they'll consider my offer. I said surely that's pointless because if they reject my offer it's a waste of everyones time, or I'll have to apply for another AIP for a different amount if I do want to raise my offer. They responded that I could get an AIP for my maximum amount then lower the actual borrowing amount when a price is agreed, so basically they'll know what my financial situation is and try to squeeze as much out of me as possiblelol I responded no chance, you have my offer, let me know if it's accepted or rejected, if it's accepted you'll have an AIP within 24 hours.

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37 minutes ago, Leicester_Loyal said:

Woke up to an email this morning saying the vendor wants a Mortgage In Principle arranging before they'll consider my offer. I said surely that's pointless because if they reject my offer it's a waste of everyones time, or I'll have to apply for another AIP for a different amount if I do want to raise my offer. They responded that I could get an AIP for my maximum amount then lower the actual borrowing amount when a price is agreed, so basically they'll know what my financial situation is and try to squeeze as much out of me as possiblelol I responded no chance, you have my offer, let me know if it's accepted or rejected, if it's accepted you'll have an AIP within 24 hours.

Like it or not mate, I don't think you'll get very far with that approach.

 

Getting an AIP for your max amount as proof of funds is standard practice to avoid dealing with time wasters. 

 

You don't weaken your negotiating stance, as despite what you 'can' afford potentially being higher, your offer is based on what you want to pay for the house in question. 

 

You should just get an AIP on your max amount and go from there mate, EAs won't take you seriously otherwise.

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43 minutes ago, Leicester_Loyal said:

Woke up to an email this morning saying the vendor wants a Mortgage In Principle arranging before they'll consider my offer. I said surely that's pointless because if they reject my offer it's a waste of everyones time, or I'll have to apply for another AIP for a different amount if I do want to raise my offer. They responded that I could get an AIP for my maximum amount then lower the actual borrowing amount when a price is agreed, so basically they'll know what my financial situation is and try to squeeze as much out of me as possiblelol I responded no chance, you have my offer, let me know if it's accepted or rejected, if it's accepted you'll have an AIP within 24 hours.

To be honest mate i'd get a mortgage in principle anyway at the maximum amount you can borrow.  And this was all sorted during the beginning when we started looking for houses nevermind making offers. We had a mortgage in Principle at 220k but bought our house for 205k. If i'm an agent and I get three offers around the same price but one party has a mortgage in principle then i'm going to go back to the client and say go with this one as they already have a mortgage in principle so it will be quicker to deal with rather than waiting on someone to get one which might not be approved.

 

Agents wont try to squeeze more money out of you just because you have a higher mortgage offer. 

Edited by Christoph
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7 minutes ago, Christoph said:

To be honest mate i'd get a mortgage in principle anyway at the maximum amount you can borrow.  And this was all sorted during the beginning when we started looking for houses nevermind making offers. We had a mortgage in Principle at 220k but bought our house for 205k. If i'm an agent and I get three offers around the same price but one party has a mortgage in principle then i'm going to go back to the client and say go with this one as they already have a mortgage in principle so it will be quicker to deal with rather than waiting on someone to get one which might not be approved.

 

Agents wont try to squeeze more money out of you just because you have a higher mortgage offer. 

I've previously had one for more though, and my Mortgage Broker said if an offer is accepted we'll have it over to them within 24 hours so not too much waiting around. You might be right tbf, my mortgage advisor said he wouldn't recommend it though. They only last for about 3 months don't they, so I'd have to keep reapplying all the time.

 

Honestly this is the most stressful period of my life, no wonder people rarely want to move houses.

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Just now, Leicester_Loyal said:

I've previously had one for more though, and my Mortgage Broker said if an offer is accepted we'll have it over to them within 24 hours so not too much waiting around. You might be right tbf, my mortgage advisor said he wouldn't recommend it though.

 

Honestly this is the most stressful period of my life, no wonder people rarely want to move houses.

 

When I made an offer I sent an email outlining the offer and my situation (I,.e. no chain, first time buyer) and attached the mortgage in principle. It makes everything so much quicker. That is really what you should be doing in this situation in my opinion. Don't wait for anyone else to email that document that should be your job to do with the offer. 

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10 minutes ago, Nod.E said:

Like it or not mate, I don't think you'll get very far with that approach.

 

Getting an AIP for your max amount as proof of funds is standard practice to avoid dealing with time wasters. 

 

You don't weaken your negotiating stance, as despite what you 'can' afford potentially being higher, your offer is based on what you want to pay for the house in question. 

 

You should just get an AIP on your max amount and go from there mate, EAs won't take you seriously otherwise.

Missed this post, apologies.

 

I will speak to my mortgage advisor, you may both be right, but it seems the wrong way round to me as I'll have to keep reapplying. If they said look we'll accept the offer but you need an AIP, I'd have it within 24 hours.

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