Will the plan work to turn generation rent into buy?
Discussion
NRS said:
I do a 37.5 hours a week. your 60 hours is utter BS, no one would do that.
I did, for years Worked a shift pattern that involved quick change overs finishing nights at 6am back on again at 2pm. Or finishing at 10pm back on at 6am
9 days on in a row before overtime 72 hours
Longest continuous shift I did was from 7am on a Friday morning to about 8pm on the Sunday night .. around 60 hours with just a couple of hours kip in the back of a van
Frequently we’d start in the morning at 7am get involved in a job and be going home at 4am the next day, getting changed and coming back in 7am and finishing it off
Long hard days
okgo said:
The thing is, the 600k thing is aimed at London. Where that will buy you a nice 2 bed, or a total s
tehole of a house somewhere. These people will all easily be able to afford the payment, as for a couple they'll be used to paying 1k each for a room already/1800-2k for a alright 1 bed somewhere. So I do think there will be a fair few going at the top end. Obviously finding 30 grand is still a fair amount, but it's within the reach of BOMAD/your more saving oriented 28 year a lot more than 60 is.
But yes, those rates are grim.
Slim pickings near me, but lets assume a couple borrow the maximum allowed and go for something like this.tehole of a house somewhere. These people will all easily be able to afford the payment, as for a couple they'll be used to paying 1k each for a room already/1800-2k for a alright 1 bed somewhere. So I do think there will be a fair few going at the top end. Obviously finding 30 grand is still a fair amount, but it's within the reach of BOMAD/your more saving oriented 28 year a lot more than 60 is.But yes, those rates are grim.
https://www.rightmove.co.uk/properties/104484818#/
They need the £30K deposit so borrow £570K with Halifax at 3.73% over a 25 year repayment mortgage.
I make that £2924.35 a month........
Joey Deacon said:
Ouch, as someone who got a 1.54% mortgage with Natwest with a 20% deposit last year, these figures seem incredibly high.
I assume the reality is going to be that looking past the headline "5% deposit" these mortgages are going to be unaffordable for a large percentage of the people they are aimed at.
I'm not so sure. My brother is finally looking to buy and I'd say those rates would result in a similar amount in mortgage payments as he pays in rent where he is in Worcestershire. I assume the reality is going to be that looking past the headline "5% deposit" these mortgages are going to be unaffordable for a large percentage of the people they are aimed at.
But at least he's building equity this way.
From memory, these rates don't look to dissimilar to when my wife and I first bought using a 100% mortgage 20 years ago.
stitched said:
Step duly taken.
I have thought quite a bit about my privileged life.
You actually worked behind the bar, or served or cooked food for those 84 hours?
And I agree actually, running a pub or bar can be exacting work, I hope you can get back to it soon.
Don't cheers me immediately after still having the audacity to question whether or not I have worked those hours.I have thought quite a bit about my privileged life.
You actually worked behind the bar, or served or cooked food for those 84 hours?
And I agree actually, running a pub or bar can be exacting work, I hope you can get back to it soon.
TBH, I wish I was still in the pub then I would simply pour your drink down the drain and drag you off the premises, backwards, in line with our customer behaviour policy.
FWIW, no I was not behind the bar or cooking food for all of those hours, some of them were spent vacuuming the garden, scrubbing toilets clean, getting stock in and out of the cellar, cashing up and filling out financial reports, or doing any other of the myriad of tasks it takes to successfully run a pub that the average feckless pleb wouldn't think about.
okgo said:
Pretty sure I had a 4% rate when I bought in 2012 with a 10% deposit actually.
When I bought the first 50% share of my shared ownership place in 2016 with a 10% deposit the best rate I could get was 4.29%.When we remortgaged in 2019 for the whole house at 90% LTV the rate was 2.29%, which then dropped to 1.49% with the BOE rate drops. That 2 year deal is ending soon and the best we can get now with 84% LTV is around 2.89% (with no early repayment penalties as we are looking to move soon).
stitched said:
The idea that someone is capable of working for 120 hours a week is simply risible.
That I take the stance that working involves performing tasks for money, or in your case to better your business.
So to the 120 hours a week claim, don't tell me, show me.
Because at best it is misleading, at worst an outright lie.
Look down.That I take the stance that working involves performing tasks for money, or in your case to better your business.
So to the 120 hours a week claim, don't tell me, show me.
Because at best it is misleading, at worst an outright lie.
Is there velcro where your shoelaces should be?
Just because you have neither the experience of, nor the imagination to consider vastly different sectors to your own does not mean that anyone is lying.
It's like me saying that I have had 300,000 volts flowing through me. To a layperson that didn't study basic science that sounds unbelievably high, but as an insulation tape monkey you will know that it is quite, quite possible.
Also, considering that you can put your screwdriver down at any time without consequence for a breather, I find it particularly distasteful you question how much someone is working in a sector where one can't take five whenever they feel like it.
You can't stop for a minute whilst bathing Mavis, because she'll drown.
It's one of the reasons why people working in care work much harder than you do, despite being rewarded less.
I know it's a new concept for you and others but the relationship is not linear.
That's why some people work really hard for upto, but not exceeding, 84 hours a week to be able to get help from a mortgage lender, whereas a lazy albeit naturally gifted pisshead like myself can own his own home with zero debts whilst typically working only two days a week, as a favour, at the age of 43.
Cheers
Squirrelofwoe said:
When I bought the first 50% share of my shared ownership place in 2016 with a 10% deposit the best rate I could get was 4.29%.
When we remortgaged in 2019 for the whole house at 90% LTV the rate was 2.29%, which then dropped to 1.49% with the BOE rate drops. That 2 year deal is ending soon and the best we can get now with 84% LTV is around 2.89% (with no early repayment penalties as we are looking to move soon).
Much talk about money being as cheap as it's ever been.When we remortgaged in 2019 for the whole house at 90% LTV the rate was 2.29%, which then dropped to 1.49% with the BOE rate drops. That 2 year deal is ending soon and the best we can get now with 84% LTV is around 2.89% (with no early repayment penalties as we are looking to move soon).
That is true, if you have a lot of it to begin with. A mate of mine just bought a place and borrowed I think only 50%, their rate makes my 1.25% look expensive!
Anyway, this was the argument put forth by myself and others about the south of the UK, a great many people can service the debt, but finding a small percentage of a large number is quite difficult.
This 5% mortgage also brings up an issue with LTV affordability again. £250k is the current average house price, you would need a £237,500 mortgage at 5%. Meaning you'd have to earn £52,700 a year to dip JUST into the 4.5x affordability. With the average salary being either £30,500 or £38,000 depending on the number you use. An 'average' person still can't afford an 'average' home by themselves. Obviously much easier for a couple with the affordability to boot.
Sycamore said:
Joey Deacon said:
I assume the reality is going to be that looking past the headline "5% deposit" these mortgages are going to be unaffordable for a large percentage of the people they are aimed at.
I'd imagine it'll be mostly used by those buying a cheaper home anyhow, so the extra interest in the grand scheme of things isn't that bad, provided it means people can get a mortgage payment similar to what they'd be paying in rent. Plus home insurance, plus repair money, plus the service charge and ground rent which was previously bundled into our rent...
Once again the government are artificially inflating prices to make it easier for those who are already doing fairly well and would have probably been able to buy somewhere in the next few years anyway... but nothing to help those who haven't got a hope in hell of owning their own home anyway because the amount they can save is so meagre compared to home prices.
romeogolf said:
When I was last renting in 2017 we paid £900/month for a 2-bed flat. Six months after moving out it sold for £240,000. With a 5% deposit the mortgage over 25 years @ 3.99% there would be £300/month more than our rent. Even over 30 years it would be £100 more.
Plus home insurance, plus repair money, plus the service charge and ground rent which was previously bundled into our rent...
Once again the government are artificially inflating prices to make it easier for those who are already doing fairly well and would have probably been able to buy somewhere in the next few years anyway... but nothing to help those who haven't got a hope in hell of owning their own home anyway because the amount they can save is so meagre compared to home prices.
I think many people will accept that because they've not worked hard enough, and eaten too many avo smash's, that they'll pay a small premium in the short term to buy vs rent with the long term view being that it will end up being at least comparable month to month, if not less, and that you own something at the end.Plus home insurance, plus repair money, plus the service charge and ground rent which was previously bundled into our rent...
Once again the government are artificially inflating prices to make it easier for those who are already doing fairly well and would have probably been able to buy somewhere in the next few years anyway... but nothing to help those who haven't got a hope in hell of owning their own home anyway because the amount they can save is so meagre compared to home prices.
I said maybe on this thread, I bought a place in 2013 almost identical to the numbers you gave, it was being rented out at about 900 quid, and with 10% deposit it cost me about 1k or so each month in mortgage based on me paying £240k. When I sold it perhaps 2 years ago now, maybe 3, I got just under £320k and it would have cost barely anymore to rent it than it did in 2013. So yes, the renting it would have cost less on a monthly for the entire time, and even more so when you factor in repairs and works etc. But would it have been better than the £80k capital gain and perhaps £30k or so of equity my payments created? No.
Of course I bought by chance at a good time, though could have got another 20k for it had I sold it at a better time (2016), but suppose that would have negated more payments so probably would have netted out the same.
Edited by okgo on Tuesday 20th April 15:24
okgo said:
Pretty sure I had a 4% rate when I bought in 2012 with a 10% deposit actually.
I'd imagine your loan amount would have been quite a lot less than now though? So monthly payments would be less on that 4%?Earthdweller said:
NRS said:
I do a 37.5 hours a week. your 60 hours is utter BS, no one would do that.
I did, for years Worked a shift pattern that involved quick change overs finishing nights at 6am back on again at 2pm. Or finishing at 10pm back on at 6am
9 days on in a row before overtime 72 hours
Longest continuous shift I did was from 7am on a Friday morning to about 8pm on the Sunday night .. around 60 hours with just a couple of hours kip in the back of a van
Frequently we’d start in the morning at 7am get involved in a job and be going home at 4am the next day, getting changed and coming back in 7am and finishing it off
Long hard days
NRS said:
I know. It was utter BS what I said. The reason it was said is we've had a regular poster saying people need to work harder and put the hours in, like he does. Then when some are saying they have done and do more hours than him he says he doesn't believe them. So there seems to be a magical window that exists of hard work, that no one crosses because he has no experience of it.
Apparently hundred and thousands of offshore workers don’t work 12-15hrs days because he said so 
okgo said:
romeogolf said:
When I was last renting in 2017 we paid £900/month for a 2-bed flat. Six months after moving out it sold for £240,000. With a 5% deposit the mortgage over 25 years @ 3.99% there would be £300/month more than our rent. Even over 30 years it would be £100 more.
Plus home insurance, plus repair money, plus the service charge and ground rent which was previously bundled into our rent...
Once again the government are artificially inflating prices to make it easier for those who are already doing fairly well and would have probably been able to buy somewhere in the next few years anyway... but nothing to help those who haven't got a hope in hell of owning their own home anyway because the amount they can save is so meagre compared to home prices.
I think many people will accept that because they've not worked hard enough, and eaten too many avo smash's, that they'll pay a small premium in the short term to buy vs rent with the long term view being that it will end up being at least comparable month to month, if not less, and that you own something at the end.Plus home insurance, plus repair money, plus the service charge and ground rent which was previously bundled into our rent...
Once again the government are artificially inflating prices to make it easier for those who are already doing fairly well and would have probably been able to buy somewhere in the next few years anyway... but nothing to help those who haven't got a hope in hell of owning their own home anyway because the amount they can save is so meagre compared to home prices.
I said maybe on this thread, I bought a place in 2013 almost identical to the numbers you gave, it was being rented out at about 900 quid, and with 10% deposit it cost me about 1k or so each month in mortgage based on me paying £240k. When I sold it perhaps 2 years ago now, maybe 3, I got just under £320k and it would have cost barely anymore to rent it than it did in 2013. So yes, the renting it would have cost less on a monthly for the entire time, and even more so when you factor in repairs and works etc. But would it have been better than the £80k capital gain and perhaps £30k or so of equity my payments created? No.
Of course I bought by chance at a good time, though could have got another 20k for it had I sold it at a better time (2016), but suppose that would have negated more payments so probably would have netted out the same.
Edited by okgo on Tuesday 20th April 15:24
In our case, we went from a rented £240k flat at £900/month to a £300k house at considerably more... but then we had the benefit of additional income and no dependents, which helped build those savings and then went on the mortgage. Not everyone is so fortunate
Yeti97 said:
This 5% mortgage also brings up an issue with LTV affordability again. £250k is the current average house price, you would need a £237,500 mortgage at 5%. Meaning you'd have to earn £52,700 a year to dip JUST into the 4.5x affordability. With the average salary being either £30,500 or £38,000 depending on the number you use. An 'average' person still can't afford an 'average' home by themselves. Obviously much easier for a couple with the affordability to boot.
It's simple don't buy the average house as your first house, buy a cheaper than average house. That's why its called a property ladder.Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff