Time to move out?
Discussion
Here’s the situation - apologies for lengthy post.
(Less important bit)I'm 25. About to start new job where I will at last be on a half decent living wage (below national average but at least a 'proper' wage at last). Been living at home for nearly 3 years after coming back home after Uni.
2011 should finally be the year for me to move out - for good.
I would happily rent - I have no problem with it, and the 'money down the drain' thing doesn’t totally sit with me as I understand the value of my freedom (IE I've lived away for 3 years already anyway).
However. Good relationship with my Mother - who I live with now. She is remarried and effectively 2 families became one, she’s managed to pay her mortgage off. Earns half decent money, willing to help. I've paid them quite a lot of money in rent over the years (again, I have always been happy to do so), and very much not a freeloading dosser who refuses to leave the family home - I'm very willing, just not able yet.
Other siblings, despite being younger than me, seem to be all 'sorted', moving in with boyfriends etc. My Mother understands I really don’t want to be living with her, and she wants some quiet back too to spend with my step dad after 25 years! We get on great, but I really need to be out to feel like I've properly grown up.
They've offered to help out, and we've started discussing things. Now obviously - its early doors - I have to see how the new role goes, make sure its ok, make sure nothing drastic is going to happen in the next year or so.
But we are looking at buying somewhere together. I am happy to stay close by to where I've grown up as that’s where I'm working, and its where my friends and family are. Its also, thankfully, cheap-ish when compared to most of the country.
The general, very basic idea would be that they can help with a much larger cash deposit than I can muster up on my own, and either she, or the both of us, will be able to borrow much more than I could on my own. The property would have to be one carefully chosen so that we could then let out one of the rooms, most likely to a mate or someone else my age, to cover a portion of the mortgage.
(Most likely a cheap, modern-ish, probably not vastly interesting 2 or 3 bed semi in suburbia close to where I live and work now).
The general gist of it is - it won’t get any cheaper to buy in the long run. Having even a half ownership on somewhere would give me some security and something to hopefully build on.
I am actually keen to also 'own' somewhere and make a home and between myself and my family I have at my disposal lots of skills in DIY/building etc, a free professional garden designer who will work for beer (cheers dad) etc - so it could 'work' well.
Now I'm not daft, and nor is my Mother (who works in finance/budgeting anyway) - we are well, well aware that there is an awful lot to consider very carefully. Such as -
- Mums financial security if she borrows again
- My financial security and job outlook for the future
- Taxable earnings if we let a room out
- Capital gains tax on the house value if it becomes a second property for my Mum
- What happens when either of us wants out/are forced out
- Security of rental income which could be covering half the mortgage, considered in either short or long term.
- Practicalities of renting a room out in 'my' house (I know this can cause issues between home owner and person renting)
- Financial implications of me 'borrowing' or being gifted a large chunk of cash for a deposit.
- Legal implications, and how we would draw up agreements between us to cover all possible situations
- Who covers future costs such as repairs etc
- How the ownership is split up between us
And much more.
Please take this the right way - it’s not me asking advice on how to spunk away money I've got free from the Bank of Mum and Dad. It’s coming up with a way to help me get a kickstart I perhaps couldn’t otherwise afford yet, by utilizing the position and greater financial security of my parents in the most effective, economical and honest way, and with everyone’s best interests at heart.
It’s all in the future and something we will be thinking about over Christmas and as I get settled in my new role (very excited about this).
Has anyone any general advice on where to start though? Has anyone done anything similar?
(Less important bit)I'm 25. About to start new job where I will at last be on a half decent living wage (below national average but at least a 'proper' wage at last). Been living at home for nearly 3 years after coming back home after Uni.
2011 should finally be the year for me to move out - for good.
I would happily rent - I have no problem with it, and the 'money down the drain' thing doesn’t totally sit with me as I understand the value of my freedom (IE I've lived away for 3 years already anyway).
However. Good relationship with my Mother - who I live with now. She is remarried and effectively 2 families became one, she’s managed to pay her mortgage off. Earns half decent money, willing to help. I've paid them quite a lot of money in rent over the years (again, I have always been happy to do so), and very much not a freeloading dosser who refuses to leave the family home - I'm very willing, just not able yet.
Other siblings, despite being younger than me, seem to be all 'sorted', moving in with boyfriends etc. My Mother understands I really don’t want to be living with her, and she wants some quiet back too to spend with my step dad after 25 years! We get on great, but I really need to be out to feel like I've properly grown up.
They've offered to help out, and we've started discussing things. Now obviously - its early doors - I have to see how the new role goes, make sure its ok, make sure nothing drastic is going to happen in the next year or so.
But we are looking at buying somewhere together. I am happy to stay close by to where I've grown up as that’s where I'm working, and its where my friends and family are. Its also, thankfully, cheap-ish when compared to most of the country.
The general, very basic idea would be that they can help with a much larger cash deposit than I can muster up on my own, and either she, or the both of us, will be able to borrow much more than I could on my own. The property would have to be one carefully chosen so that we could then let out one of the rooms, most likely to a mate or someone else my age, to cover a portion of the mortgage.
(Most likely a cheap, modern-ish, probably not vastly interesting 2 or 3 bed semi in suburbia close to where I live and work now).
The general gist of it is - it won’t get any cheaper to buy in the long run. Having even a half ownership on somewhere would give me some security and something to hopefully build on.
I am actually keen to also 'own' somewhere and make a home and between myself and my family I have at my disposal lots of skills in DIY/building etc, a free professional garden designer who will work for beer (cheers dad) etc - so it could 'work' well.
Now I'm not daft, and nor is my Mother (who works in finance/budgeting anyway) - we are well, well aware that there is an awful lot to consider very carefully. Such as -
- Mums financial security if she borrows again
- My financial security and job outlook for the future
- Taxable earnings if we let a room out
- Capital gains tax on the house value if it becomes a second property for my Mum
- What happens when either of us wants out/are forced out
- Security of rental income which could be covering half the mortgage, considered in either short or long term.
- Practicalities of renting a room out in 'my' house (I know this can cause issues between home owner and person renting)
- Financial implications of me 'borrowing' or being gifted a large chunk of cash for a deposit.
- Legal implications, and how we would draw up agreements between us to cover all possible situations
- Who covers future costs such as repairs etc
- How the ownership is split up between us
And much more.
Please take this the right way - it’s not me asking advice on how to spunk away money I've got free from the Bank of Mum and Dad. It’s coming up with a way to help me get a kickstart I perhaps couldn’t otherwise afford yet, by utilizing the position and greater financial security of my parents in the most effective, economical and honest way, and with everyone’s best interests at heart.
It’s all in the future and something we will be thinking about over Christmas and as I get settled in my new role (very excited about this).
Has anyone any general advice on where to start though? Has anyone done anything similar?
Edited by snotrag on Tuesday 9th November 14:24
Like you stated before, renting isn't the worst thing in the world, especially not at 25.
I bought a house at 22 but I would have happily rent at that time, even now. It also helps you to "know what you want" for a future house.
Do you have a girlfriend/partner yet? (didn't read that anywhere) I'd deffo say "rent" now:
- Rent
- Get to know somebody
- Rent together
- If you're very sure of your relationship: buy together
You won't have any commitments then and can buy with the budget of two incomes instead of one, should be a lot more comfortable.
Anyway, that's my two cents.
Good luck with the hunt and your future career!
I bought a house at 22 but I would have happily rent at that time, even now. It also helps you to "know what you want" for a future house.
Do you have a girlfriend/partner yet? (didn't read that anywhere) I'd deffo say "rent" now:
- Rent
- Get to know somebody
- Rent together
- If you're very sure of your relationship: buy together
You won't have any commitments then and can buy with the budget of two incomes instead of one, should be a lot more comfortable.
Anyway, that's my two cents.
Good luck with the hunt and your future career!
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