When I was younger I thought a decent wage would be £35,000 a massive wage would be £40,000 which I would say would be true for most of Sheffield and yet can I afford the next step on the property ladder?? No way. I can get a mortgage for £122500 and what does that get you these days?

Am I missing out somewhere or can anyone tell me how a normal sort of family house is about £300,000-£450,000. Even if you had £200,000 of capital you would need to be on £60,000 odd grand a year. Only 12% of Hallam are on that according to the BBC.

So how do people afford to buy a decent family sized house? Do you lie, work all hours of the day or both people work?

I think most people on this board would have thought that a "normal" sort of family house in Sheffield was substantially less than £350k, though if you set your sights on something with 4 bedrooms, Silverdale catchment etc. then this is probably about right.

Being less than honest on mortgage forms and working all the hours going probably is a factor but in my experience the big 3 reasons would be;

Trading up - most people buying in this bracket are sitting on a reasonable capital gain from previous property.

Two incomes - most folk i know in Hallam are dependent on two reasonable incomes.

Inheritance Tax - IMO this is a growing issue, more older people are determined to stop the government getting their hands on their estate and are passing on capital to their family well in advance of death. The introduction of the pension arrangments and the flood of money in SIPPs will only make a difficult situation worse.

Blimey

And I thought I was the only one here who thought property was overvalued in Sheffield.
(And the whole country too).

Welcome aboard

:)

d

Originally posted by gd_1
When I was younger I thought a decent wage would be £35,000 a massive wage would be £40,000 which I would say would be true for most of Sheffield and yet can I afford the next step on the property ladder??

I realy am quite confused by this property "ladder" thingy, unless you actualy need to move house (more kids etc) what is this obsession that people seem to have with owning a bigger and bigger house that costs them every penny they have ?

Don't people just buy a house and live in it for 20 years anymore (like our parents did) ?

I blame Living TV for this.

Originally posted by nick2
I realy am quite confused by this property "ladder" thingy, unless you actualy need to move house (more kids etc) what is this obsession that people seem to have with owning a bigger and bigger house that costs them every penny they have ?

Don't people just buy a house and live in it for 20 years anymore (like our parents did) ?

I blame Living TV for this.

I think the reason for it is that moving to a larger property is, in effect, just another means of investment. Property is a fairly safe bet at the moment given this current Government's attitudes towards those with large amount of savings. By buying larger and larger houses you can continually expand your wealth. Having said all that what's the point? Labour will only go and tax you 40% on it when you die anyway.

So much for rewarding hardworkers....

I can see it's an investment but I can't understand why people get so upset when they can't move to the "next rung". It's like they have failed in life or something because they only have a 3 bedroom house and no en-suite bathroom.

It's often worth getting a mortgage lender to credit check you because this can affect how much they will lend you. They put their standard multipliers in their literature, but if you have a good credit rating then they are often prepared to lend you more than this. For instance I recently bought, looked all over for a mortgage beforehand to see what I could afford, and thought I could only get 3.5 time my salary max. When I actually found somewhere and applied for a mortgage I found out I could get 4 times my salary (which would have opened up quite a few more properties to me!). I also know someone who found a lender willing to lend them 5 times their salary.

On another note, there are some very nice houses in Sheffield for £120k (yes, they may be terraced, but still nice, and with 3 bedrooms and in an ok area) - I only wish I could get a mortgage for this much!! So maybe you just need to be looking at smaller homes, or different areas? I heard that the average salary in Sheffield is around £19k, so people are having to be creative about how to get on the property ladder.

Originally posted by JonJParr
Labour will only go and tax you 40% on it when you die anyway.


How can you be taxed when you are dead?

I think death duty should be raised back up to 90% for anything over a million. That way, people will spend up before they die and release all their money into the economy.

Originally posted by max
How can you be taxed when you are dead?

IHT.

Originally posted by nick2
I realy am quite confused by this property "ladder" thingy, unless you actualy need to move house (more kids etc) what is this obsession that people seem to have with owning a bigger and bigger house that costs them every penny they have ?

Don't people just buy a house and live in it for 20 years anymore (like our parents did) ?

I blame Living TV for this.

we bought a house that we settled for because that's all we could afford. At the time we both earned <20k having only just graduated. There's no way that we plan to live in this house for 20 years or the rest of our lives, it's literally a first step.

We'll trade up when we feel ready, having both taken our incomes >30k now and having spent a lot of money improving this house.
By the time we do trade up, which I estimate to be probably about 4 years away we'll have paid off the majority of the mortgage on this house and it's value will be in excess of twice what we paid for it.

I guess that will put anything upto 300k at a stretch within our reach, although i've no intentions of us spending that much.

Personally I think we'll find something that we like for around 200k and we'll probably stay there for a good while.

I think that couples who both work are far more common these days, certainly all the couples that we know both work. So dual income is common.
And if it's the next step that you're after gd_1 then presumably that mortgage (at 3.5 * 35k) is in addition to whatever equity you have from your first step.

I just thought that this whole property thing has just made us a lot less mobile and society in general more segregated. Those with the money have it and those that do not will never be able to catch up.

I just could not work out how people afforded that kind of house without having a really boring in-debt life.

Originally posted by gd_1
I just thought that this whole property thing has just made us a lot less mobile and society in general more segregated. Those with the money have it and those that do not will never be able to catch up.

I just could not work out how people afforded that kind of house without having a really boring in-debt life.

If anything society is more mobile than it has ever been, both in terms of actually moving around the country, but also in wealth accumulation - many people have made a lot of money from property that they would never have made say 40 years ago when buying was much less common.

The fact is, unless you are super-rich and can afford to pay out for a house in cash then the only way to do it is, in your words, to "have a really boring in-debt life". And the fact is the vast majority of houses in Sheffield are well under £200k, and as such the city is still relatively affordable for buyers when compared to other parts of the country.

I think what you need to do is not say "I want to spend £350k on a house" and then attempt to find a way to afford it. You have to look at what you're earning, what sort of deposit you can get together, and then see how much the bank is willing to lend you, and when you know how much you can afford start thinking about what kind of property you want. What's the point in dreaming of a £350k house if it is obviously unobtainable? Especially when there are plenty of other good properties in Sheffield that cost nowhere near that much. I'm just thankful I finally got on the ladder with my £60k property!!

Originally posted by nick2
I can see it's an investment but I can't understand why people get so upset when they can't move to the "next rung". It's like they have failed in life or something because they only have a 3 bedroom house and no en-suite bathroom.

I can just see it as an investment but only really if you need the money for an emergency like care home charges, medical treatment etc. You could get a loan against the property if you were desperate. But I agree entirely, people have become obsessed with property values and trading up all the time. We bought our house primarily as a HOME not an investment. The lack of en suite bathrooms etc is a sad reflection on some peoples values I fear.

I don't think it is ensuite bathrooms that bothers people most, it is the associated standard of living that comes with a much bigger house.

Small three bedroomed end of terrace, with cars gassing you outside :gag: , a garden that isn't big enough for the kids to play in and a house that is so small your always tripping over the dog.

Compare that to a three bedroomed house in the country, large garden, fields next door, very quiet and peaceful. You can leave the dog out all day to have fun.

This is one of the main reasons I see people wanting to trade up, and I am one of those people who have ideas to be in a nice big house in the country by the time I am in my 30's.

school catchment would be the main reason to move. Abbeydale grange is not the best school around. It will probably be all differrent by the time my kids are old enough to go there.

Originally posted by gd_1


Am I missing out somewhere or can anyone tell me how a normal sort of family house is about £300,000-£450,000.


A normal family house is not £300-£450K, where have you been looking? As people have pointed out, you can get a decent family house for £110,000 upwards. It may not be in the most exclusive area or that big but it is a good start.

We started off in a small semi in High Green and now - many years later!! - we own a very big semi that is worth £300K in a nice area.

People want everything too early nowadays.

if you have 20% or more as either equity or a deposit then you can apply for a self certification mortgage. This negates any income multiplier calculations and you just sign a declaration that states you can afford the mortgage. How they afford the monthly repayments from that point on is another matter. Also bear in mind that if you have say 200k equity on a 350k purchase you are likely to get a brilliant rate usually circ 2% discounted for x years...