Another first time buyer/mortgage thread - buying alone!

[dannyDC2]

Evening all,

I'm after a bit of guidance/input from you guys. I've been thinking lately it's time to buy a house, but I'm really not sure where to start, and the clock doesn't stop ticking, does it. I know the right thing to do would probably speak to someone in a bank etc, but as per usual it's got to 1am and I'm thinking I had better ask my pals on a car forum first...

I'm 24 now, and want to be in my own house by 25. That's about all I've got to so far. Can't really decide where I want to live (other than away from 'home'). I've got a new job starting in Harrogate soon, but the prices up there to buy alone are a bit steep so I guess it will be somewhere within 20 miles. The crux of the purchase will be somewhere to keep my Interga (selling it is not an option), preferably a decent sized garage, which again puts me out of luck with Harrogate on my current earnings anyway.

Financially, I hope to have around 12-14k saved, and will be earning just north of 30k pa. I've been looking at houses around 120-140k with this in mind, using the 10% rule, but I fear I might have forgot to count in some hidden costs/legal fees which I'm hoping some of you can explain in some detail for me?

If I were to stay in the area that I grew up in - a 2/3bed semi with a garage could easily be had for >120k. I found a perfect house recently for 105k (modern, big garage, lovely garden, 3 bed semi). Might be a bit of a shock to some of the forum, but it is truly grim around here so ideally I do want to move on. WF9 postcode, if anyone is curious!

I'd like to know if any of you have had similar experiences really, with buying on your own. I'd rather not rent... but moving out needs to happen soon. I'll have a better grasp on my finances when I start the new job as I'm currently self employed and have money tied up in the business, so I guess I'll keep on dreaming for a little while longer.

Is there anything I should start doing in the meantime to improve my house buying experience to come? Other than be extra stingy with my wallet...

Quite an open thread as per usual with me, but looking forward to anyone who fancies having a chirp in...

Cheers
Dan

[dannyDC2]

Managed to find the link to the 105k house mentioned in the OP - looks like it sold for £98k!!! Jeez.

http://www.rightmove.co.uk/property-for-sale/prope...

If I could get over the fact of living around here for a few more years, it would have been a great starter I think.

[RobXjcoupe]

On your budget save approx 10% for deposit, that gets you a mortgage. The more deposit you put down the better interest rate you get. Buy a two bed with parking for your car but buy a property that needs work so you either get a cheaper house or a larger house. Magnolia the whole house with a new bog standard gloss white kitchen and a plain white tiled bathroom. Then sell for profit. Give yourself 9 months to do the above so the house is clean and smart to sell on in the spring. Do this about 3 times and you will have no mortgage or a nice house with a relatively small mortgage
Good luck and enjoy decorating

Edited by RobXjcoupe on Friday 21st October 01:59

[rsbmw]

RobXjcoupe said:

Stuff

Edited by RobXjcoupe on Friday 21st October 01:59

Its not 2005, you're simply not going to make that sort of money flipping property. Frankly without structural modifications you would be lucky to break even with a lick of paint and a b&q kitchen, after stamp duty, solicitors, estate agents, arrangement fees.

For this reason, personally I wouldn't bother buying a starter home in a place you're planning to leave soon. It will make escaping more difficult, unless you have the means to buy a second place and rent out the first. Keep saving your deposit cash, find somewhere you want to live and buy there.

[rsbmw]

Just checked your location, what exactly is wrong with it? Looks like there's a choice of several semi rural towns to choose from, with several large towns and a couple of cities in easy commute for good employment prospects.

[Sarnie]

dannyDC2 said:

Managed to find the link to the 105k house mentioned in the OP - looks like it sold for £98k!!! Jeez.

http://www.rightmove.co.uk/property-for-sale/prope...

If I could get over the fact of living around here for a few more years, it would have been a great starter I think.

That looks a lot of house to me for £98k!?!?

[rsbmw]

post fail

[dannyDC2]

Thanks for the replies!

The house I posted is a lot for the money. I'm somewhat regretting not making enquiries about it when I found it a couple of weeks ago. On a quick mortgage calculator last night, I didn't see a reason why it couldn't have been paid off in 15 years. Hmm!

I might keep this thread going, to track my progress, if that's okay with the mods?

[Craikeybaby]

I was earning less that you in 2008 and was able to buy my own place, at £100k with a £10k deposit and some left over for legal fees. At that sort of budget you avoid stamp duty too.

[TheLordJohn]

Craikeybaby said:

I was earning less that you in 2008 and was able to buy my own place, at £100k with a £10k deposit and some left over for legal fees. At that sort of budget you avoid stamp duty too.

Unless you are rather fortunate (or unfortunate) to own a house already. bds.
OP - 10% deposit with less than £2k for all moving in costs is definitely do-able.
I used to work near Thirsk and still own a home in North Yorkshire.
There are some very nice houses for not too daft money if you know where to look.
When do you start in Harrogate?

[MentalSarcasm]

dannyDC2 said:

Financially, I hope to have around 12-14k saved, and will be earning just north of 30k pa. I've been looking at houses around 120-140k with this in mind, using the 10% rule, but I fear I might have forgot to count in some hidden costs/legal fees which I'm hoping some of you can explain in some detail for me?

Budget another £5k or so for your mortgage and solicitors fees, stamp duty and a survey. You might be able to get some things for cheap, but you really don't want to be cutting corners on what is the most expensive purchase of your life.

House buying is really, REALLY stressful, we're in the process of buying at the moment and it's only been made slightly easier by the knowledge that we've had a decent pot set aside that means we've been able to say "yes" to a full survey and then an electrical check, without panicking that we'd then not be able to cover the solicitor's fees or the eventual stamp duty.

[TheLordJohn]

From what the OP has said, he won't be in the SDLT bracket.

https://www.gov.uk/stamp-duty-land-tax/overview

And a good solicitor should be circa £7/800. Think my comprehensive survey was c£300.
I think £5k is rather an overestimation....

[RobXjcoupe]

rsbmw said:

Its not 2005, you're simply not going to make that sort of money flipping property. Frankly without structural modifications you would be lucky to break even with a lick of paint and a b&q kitchen, after stamp duty, solicitors, estate agents, arrangement fees.

For this reason, personally I wouldn't bother buying a starter home in a place you're planning to leave soon. It will make escaping more difficult, unless you have the means to buy a second place and rent out the first. Keep saving your deposit cash, find somewhere you want to live and buy there.

If you do the work yourself you can still make money like I said. Do your homework on the area don't overprice when doing the work and it's easy to make money after all deductions. Also as mentioned you can payoff a regular mortgage within 15 years. But you could also have no mortgage within 5 years. It depends how much work you put in yourself rather than contract every item you encounter