How much would you need to earn for a £510,000 mortgage

delta0 · 12 Jul 2021 at 22:07

Usually you work up to more expensive houses. Start on something you can afford, pay off the mortgage for a few years and then work up to another property

Quartz · 12 Jul 2021 at 23:15

If memory serves, Gurnsey has two sets of prices: one for citizens and one for non-citizens, and the latter are highly restricted.

Psycho Sonny · 13 Jul 2021 at 00:22

Hive said:
People buying a house at that cost level are often putting down a lot more than 10% as a deposit.

In this thread people who don't know the difference between mortgage and house price

413x · 14 Jul 2021 at 09:47

The issue for us was not the deposit bar it was more the earning threshold.

An example of how hard it was and now is.
My partner doesn't earn much (20k?) I at the time was on 35k.
So to get the first house we (me really) wanted (detached, garden, garage) meant the bar was high (250k ish)

I believe they'd lend us 220 (4x). And that was queried on affordability .. "how are you living expenses so low?" the mortgage provider asked.
"No TV licence, 10 pound mobile phone contacts, no car finance, no credit, no kids" was the answer.

So that's a 260k house with 40k deposit in Feb 2020

Obviously the deposit was therefore way over the 10 percent bar. Giving a 85 percent ltv.

Fast forward to now.. Estimates are at 295k for the same house

If we were on the same 55k joint salary they'd be a short fall 35k for the very same House 2 years later. No way you can keep up as a first time buyer.

That's 35k extra deposit in 2 years. Crazy.

This is all about average too. Average earnings, average house.

No wonder people can't afford kids

Added to that.. 260 won't get you much in a lot of places. You simply have to move.

clv101 · 14 Jul 2021 at 09:54

mattyg said:
You have a couple of options

Lower your expectations of type of house.

Move to a location that gets you what you want at a price you can afford

Increase your household income

Find a partner who earns a decent amount too...

Its difficult. But get on the ladder early

Buy a house that needs renovating. You can make serious $$ doing that and it'll get you up the ladder quite quickly too

Or self build!

neodude · 14 Jul 2021 at 12:31

Getting an ~~interest-free~~ Interest Only mortgage will allow you to borrow more too. I know a few folks who do this, the idea being is that you just pay ~~interest free~~ Interest Only on a family home, then later in life when you retire, sell up, hopefully make a profit, and downsize.

Tuppy_Glossop · 14 Jul 2021 at 12:39

neodude said:
Getting an interest free mortgage will allow you to borrow more too. I know a few folks who do this, the idea being is that you just pay interest free on a family home, then later in life when you retire, sell up, hopefully make a profit, and downsize.

Lol, an interest FREE mortgage? Yes, please.

Calpol · 14 Jul 2021 at 12:40

neodude said:
Getting an interest free mortgage will allow you to borrow more too. I know a few folks who do this, the idea being is that you just pay interest free on a family home, then later in life when you retire, sell up, hopefully make a profit, and downsize.

I think you may be confusing terminology. I don't think Interest free is a thing with mortgages. Interest only used to be a thing but not so much nowadays. Lifetime mortgages are a thing in other countries where debt and assets pass to will beneficiaries.
If there are interest free mortgages - I'll sign up and do some spread lending

neodude · 14 Jul 2021 at 12:43

Yeah yeah, blonde moment. Interest-only is that I'm talking about

dlockers · 14 Jul 2021 at 12:48

neodude said:
Getting an ~~interest-free~~ Interest Only mortgage will allow you to borrow more too. I know a few folks who do this, the idea being is that you just pay interest free on a family home, then later in life when you retire, sell up, hopefully make a profit, and downsize.

Profit being quite creatively calculated here, unless you have someone else serving the interest payments for you aka BTL

Tuppy_Glossop · 14 Jul 2021 at 12:49

I'm waiting for a decision on 1.09% fixed for five years, which I find ridiculously low.

silversurfer · 14 Jul 2021 at 15:55

Thats very low, relates to the ten year treasury rate probably. I think rates will return to 5% one day but till then its a sellers market

I like the idea of 50% or similar size deposit and having the choice of the best fixed rates which in theory could be profitable instead of the alternative threat of rising variable rates

dowie · 14 Jul 2021 at 16:04

silversurfer said:
Thats very low, relates to the ten year treasury rate probably.

Nah, not directly, more like swap rates.

PermaChanged · 14 Jul 2021 at 16:14

chaparral said:
Guys how much would you need to earn to be able to get a £510,000 (Average house price) mortgage over 25 years ?

Go speak to Gower would be my recommendation from experience

https://www.gowerfinancialservices.com/personal/mortgages

I used them for my first Guernsey property purchase to get on the ladder in 2019, since then I've moved in with a partner and we're both now selling our respective propreties to buy something together - we've used Gower again as the broker to find us the best deal to suit our circumstances. May I ask, who's your employer locally? If you can get your mortgage through Butterfield bank they use different lending criteria to a lot of the mainstream banks and can lend silly amounts (they were prepared to lend us 900+k!).

Buying properties here you're definitely going to be better off buying a "doer upper".

Tuppy_Glossop · 14 Jul 2021 at 16:31

silversurfer said:
Thats very low, relates to the ten year treasury rate probably. I think rates will return to 5% one day but till then its a sellers market

I like the idea of 50% or similar size deposit and having the choice of the best fixed rates which in theory could be profitable instead of the alternative threat of rising variable rates

That 1.09% is based on 60% LTV.