lo all

been lurking on here for near 6 months, but only joined to post a couple of months ago. bit of background first..

i'm 25, graduate living and working in brighton. back in sept i was promoted to a point where affording a mortgage wasn't going to be much of an issue. so started looking around. I'd previously saved around 20k as a deposit, so did my research, found a nice non-council 3 bed house in brighton for 220 and bought it for 214k. looking at the figures round here, price drops just aren't happening yet. that place went on the market in mid september, similar properties are now on the same street for 300k (has a loft conversion), which sold within a week, and 2 really similar places for 260 and 290k. probably all in better condition than my place, but even with that taken in, prices are still definatly on the way up. prices may drop, and thats ok

anyway, back onto the purpose of this post - its really not that hard for graduate ftb to get on the ladder. of the folk on my graduate scheme (all in a similar position to me), around 60% of them now own properties - and this is in one of the most expensive places outside london (typical 2bed city centre flat - ftb heaven - would be 225-300k, up to 750k if its on the seafront). lots of people on here chat about affordability, but as a graduate we're used to living on 5k per year from our student days, so a 5 or 6x mortgage isnt that much of an issue.

for what its worth, i don't believe prices will keep the same, i think they'll drop a little, maybe 10-15%, but as some have pointed out on here, I believe as more people borrow money from their folks, mortgages get longer (30-40 years) and the shortage of property continues, i think prices dropping back down to 3.5x income is unlikely. either way, its just money, so its not the end of the world..

/waits to be flamed

Congratulations, I hope it works out for you.

I don't think anyone will flame you just wish you the bast of luck with it, personally I wouldn't touch property right now with a barge pole but as long you you are prepared to accept the rough with the smooth then good for you.

As long as your not planning to flip it doesn't matter. In 15 years time the price you paid now will likely seem cheap and your outstanding mortgage payments will be a lot lower.

Something tells me you may not be a student of Economics.



Read that back to yourself and think...think very deeply about this.



For what its worth I think that I will be noticed by a flying movie mogul and whisked away to Hollywood for a mega career..you see this is called "wishful thinking" a cousin of "faith" and is not based in any "fact". You assume that most people have a rich mommy and daddy to pay thier childrens way onto the housing pyramid scheme...this is not the case for the majority of people, and if you cant get a deposit or mortgage you cant buy a property...go on think about what then happens to housing prices...if you can't see any issues with being massively indebted for 30 to 40 years ( a large proportion of your estmated life span) then Im afraid you are beyond the point of no return.

Yeah its just money and what happens to a fools money?

Enjoy your new home by the way.

In 2-3 year when your flat will be worth 50% of what it is now, could you let us know what your thoughts are? Also, the amount of negative equity would be interesting to most here. Cheers.

So you're mortgage is around £194k? That's about 91% LTV. On a 6% 3 year fixed rate mortgage, that works out to about £1,200 per month excluding insurance, utilities, living costs, maintenance, stamp duty etc. I assume you are buying with a partner? If not, then heaven help you.

Alternatively, when your flat (sic) is worth the same, or slightly more, could you also let us know what your thoughts are, and also the amount of equity you have. I'd be interested in that as well.

It's a 3 bed house. But whereabouts in Brighton I fear to ask?
Because if it's in as currently 'gritty' an area as I suspect it is at that price, then it may become a little more like the Whitehawk Estate than Hove once the house price crash-led recession hits and everyone (especially debt-anaesthestised students) realises they're stuck with big debts on depreciating assets for life, in a much more 'challenging' economic environment for the UK and the West in general, probably forever ("get used to a lower standard of living" sez Merv).

Still, I could be wrong, it might be a relative bargain ina reasonable area and your family income will cope well with the future. But I do think you're going to regret, to some extent, buying this year rather than in another 2 or 3.

But hell, enjoy it, there's often fun to be had as a homeowner, no doubt.

I hope you really really really like the place because you'll be hanging on to it for a long time - unless of course you haven't factored in interest rate rises and are repossessed.

with regards to nominal vs real, the effects of inflation (same old same old - classic bullish argument seems to ignore inflation and all costs, never been explained to me why this is sustainable or affordable) I'll leave it as I've given up arguing the case

but on a separate point - grad salaries, after a 2 or 3 years, of 40 - 50k I guess?

which industry is that in, that's very good - actuarials, financial analysis, management consulting, vets/doctors?

I have been watching the Brighton housing market closely for a year in the price range you have bought. I can honestly say that there have been price reductions since the peak in the summer. I have viewed houses that went for £250,000. The same houses on the same street are on the the market now for £229.950 that are in similiar condition.And this is not just one area. This is a pattern that I have seen emerging since the onset of winter. The houses that are on for last summer prices are simply not budging and there are plenty of them. The amount of houses for sale in my search has doubled and is creeping up.House that sell are ones that have dropped there asking price 10% and have probably been bid down a little more.

Prices in Brighton have grown to at least 9 times local wages. Is the top BTL place outside London. Brighton suffered badly in the last crash and this time it will be as bad if not worse this time around.I can't understand why at 25 you want to spend your days servicing a huge mortgage having paid investor bubble prices. Why not have a landlord subsidise your housing while you save towards your future house and reducing your future mortgage and being able to live comfortably and remaining flexible?

Buying at the top of the market is not a sensible decision as a wait and see approach is currently paying off.Well it certainly is for me. I am even more surprised that you have bought after lurking here for the last 6 months especially with what has been happening in the financial world.

Good luck.

Good luck with the house. Well done.

I wish everyone who bought a house would post a topic on here once they completed as it would at least prove that they'd sought a contrarian view and satisfied themselves that they'd done the right thing.

My personal view is that you'd be best off wiping your memory of this site now, for fear of huge regret later, but that is just subjective.

my point being, if i'm used to living on 5k per year, then loosing 50% of a 20k takehome (for instance) still leaves me with twice the money to play with, comparably, so 6x of 35k (reasonable graduate wage) isnt a problem, as long as the graduate hasnt 'learned' to spend all his new, higher income




its a family home. even i wouldnt touch a new-build city centre flat (and there's a LOT of them here)



i bumped up my deposit to 10% so 90% ltv, on a tracker mortgage (.27% below boe) but your assumptions are about right - i think its £1150 at the moment. had a seperate pot of money for stamp duty etc. buying on my own, but i might let out one or 2 of the rooms if i get lonely - either way the payments account for roughly 50% of my takehome wage (its a 4x mortgage)



its just off coomb road - so not bevendean, moulscombe or hollingdean. last folk moved in to the house in 1938 (!!!!!!!) so it lends some hope that the area will remain nice.




i can take an extra 2% on interest rates without sweating, more than 4% and i'd probably start to struggle.


the general mood on this thread is a lot more supportive than i thought it would be - so thanks. around the 'would be better to have bought next year' - might be true, but at the same time may not. something that helped me a little was looking back at the 'classics' forum - threads from 2004 about how everything was pointing to a crash the next year. prices round here are up 20% since then, and anyone who didnt buy would be kicking themselves. granted there was a slowdown, but it canceled itself fairly quickly. getting on the ladder (moving up it is less of a gamble imo) is always a gamble, and wherever the prices are they can always rise higher, or drop lower - no-one knows, we all just guess

I want to know where all these mythical graduate jobs are!

Although that said, i do have a degree in economics but chose to work in IT and after nearly 10 years have risen all the way to 35k a year, which is actually pretty good/average for it workers with degrees.... I'd love to know where all these graduate jobs which pay 40k+ after 2 years are

Especially in Brighton, me and the missus planned to move down there a couple of years ago but as highly qualified IT techs couldn't find any decently paid work and couldn't justify the commuting costs!

Did you read understand why that happened and what the long term ramifications of that was?

Good luck with it by the way and that is said with no hint of sarcasm, I think many of us on here could buy tomorrow if they wanted, we just choose not to.

I did exactly that. Bought a house about 2 years ago after much consideration and then avoided this site until recently.

My advice would be to go and bury your head in a bucket of pebbles.

Good luck with the house.

So you did it. I wish you all the best and if in a few years you decide there's more to life than a mortgage millstone around your neck then you picked a good area for student lets.

I'd also be genuinely curious to know what the OP does for a living that allows him / her to earn 45k per year at 25. No employer is willing to pay anyone 45k straight out of college except for some City employers who, as you can tell by the name, aren't located in Brighton. Equally I know the oil industry will pay 45k to engineers in their 20s but that's only in Aberdeen. The only role I can think of that pays that well would be a GP but most GPs are 28 before they even can get close to earning full salary as it takes much longer to qualify.

Employers that pay 45k per year to 25 year olds are therefore thin on the ground and not usually located in Brighton - something doesn't add up here ...

Hey I was 30 in 1998 and bought my first flat in nearby delightful Chichester for.....

£44,000. I earned about £13,000 pa.

£2,200 deposit on interest only from C&G and had to have an interview and do a boring budget to convince them of my credit-worthines.

Good luck dude - they say that timing is all that matters in life Way too young IMHO, and a crazy multiple on your ill gotten gains (Lawyer? EA?)

Are you involved in the entertainment world to be earning such huge wonga, or just cooking up Kristal Meth in the kitchen*?

*that shid can blow the whole gaff down - be careful.

Accounting, actuary, law etc etc... plus spiv jobs like recruiting

There's a few hedge funds around Brighton and Amex has a big office there too. Probably a few jobs around the place that pay 45K after a couple of years. Or maybe he's a rent boy?

EA... too.

Now, now; dont be cheeky.

heh, the guesses at my job are amusing. I work in IT\telecomms - technically i'm out of uni for 2.5 years, however i've been working here for 4.5 years (first 2 years were part time with a part time masters). I'll accept my wage is above average, but so are the prices round here. You'd not need to be earning an inordinate amount to afford a flat in, say, cardiff or brum (100k mortgage at 4x 25k??). do you lot really consider 4x that crazy? amongst my peers, i'm certainly not the highest paid, but probably among the upper end outside the city (one guy i went to uni is got 70k last year from a city firm )

my point of this thread really wasn't to show off. If i wanted to do that i could find far, far more receptive forums for that it was just my 2p that while things are expensive, and credit is tightening, a lot of ftb are still within reach of getting on the ladder, if they should so desire. even in brighton there are studio flats (probably executive, luxury etc) still (just) sneaking in under £100k

Just because you can afford to buy doesn't mean that it's sensible to do so .

Damn, I'm in the wrong job. 30, chartered mechanical engineer, not yet earning 40k and I'm chuffed with my salary, but then I do a job I enjoy. Sometimes I can't actually believe people pay me as well.

But, typical graduate, good luck with your purchase. Enjoy it and forget everything about house prices. You now don't have a house, you have a home. Prices are only relevant to you when you sell.

I won't say anything unkind like remember it's half term folks!

But assuming your tale is true, I wish you the best.

I very much doubt there's loads of FTBers who can afford at that price, though.

When I was last in Brighton it was indeed busy (just a few weeks ago) so the gloom has not washed on to all beaches yet.

Good luck. If you don't plan to move then you're sorted. Getting the property for a lot less in a couple of years shouldn't be the most important thing in life.

I'm guessing you'd be lucky to get that in a decent area, but don't know that as a fact for cardiff or brum

and is that really reasonable for a FLAT - consider the median wages in the areas you cite...?

You are only at Chapter 2 in the book of life, please let us know how you get on when you have reached chapter 6. Life is just one giant game of snakes and ladders. Enjoy the ladder moments when they come along. Best of luck.

Big 4 accountants in London are currently paying about £28k starting salary rising to about £35k to top performers after two years and £50k on qualification (3 years).

If you leave university at 21 it is fairly easy to be on £50k by the time you are 25.

I take about accountancy because it is my industry but similar for lawyers too.

IT has been a failed promise for a lot of people, for similar levels of qualification it pays less in many cases than accountancy or law, esp in the regions, but a few years ago promised as much.

Also to get into big 4, and similar firms, requires a money- and success-drive that not all share. Easy is conditional - you have to want that kind of work and enjoy being at it, surely???

If lawyers or accountants (my gf is an example in a relatively lower stress accountants job) are not so ambitious - ie working for end-user firms in company accounts, or a salaried lawyer without aspiring or climbing to the various associate, etc grades in big practicing firms, then they, too, can be on modest salaries more typical of general professionals, I believe, in 20s and 30s of K (add to this anybody). I say modest, but there are still above national average wages, as is IT dev.

An interesting one is the environment sector - expanding, under a lot of public money and concern re: global warming, flood control etc - a minimum Masters qual is practically necessary to get any level of job with prospects, but even when chartered level is reached people are doing well to be earning in the 30s of K, that takes years of effort. Having said that it's a very popular field of work with deep job satisfaction and a lot of time spent in rural sites etc.

5l4b - thanks for the post and enjoy your new home. Let me tell you a story from the 80’s. Two friends of mine we all grew up in a grim industrial city. Let's call them Richard and Andrew because that’s not their real names. Both were working class boys making good - Richard was off to one of the best universities in the country with 12 Grade ‘A’ O levels and 4 Grade A ‘A’ levels. Andrew with his BCD ’A’ Level grades was off to a minor university. Richard did well a first in mathematics - graduated in 1987 companies falling over themselves to employ him - he lands a job paying triple what the rest off us earn. Buys a new build in West London 1988 because that’s what the young upward professionals were doing at that time. I remember seeing his new house with Andrew and thinking if that’s what he can afford there’s no way we will ever get on the property ladder…. Cut to 1996 Richard was looking at £40,000 negative equity, Andrew has finally got a career but not a salary in Richards league. Andrew buys a three storey terrace house in sw London needs decorating and a bit of work but nothing major. Richard’s family is growing and the second bedroom isn’t so big when all the baby’s toys are in there. He sells at a loss and moves out of town buys another nice house in a cul de sac in Hampshire. Both friends have great families both have done well… but despite never earning the figures Richard commands Andrew now lives in a house Richard could never afford.

Don’t get me wrong we’ve all been lucky we have our health, our families, spare cash to buy beer, none of us could tell the future - be happy in your new place if it is your home and your family’s home the fluctuations of the market place will be inconsequential if you are hoping to make a quick buck it may be slower than you think. One of our dad’s was always was strong on advice and his best advice was ‘live for your generation’ - for our generation staying at home getting apprenticeships and council houses was no longer an option… I sometimes wonder if ours is last generation that will see value in home ownership…

To this thread I say, AWOOGA.

£194k is 4x salary eh? So salary is £48.5k?

Anyone with genuinely enough brains to be paid that, in an IT job only a few years out of uni, would also have the brains to know thats not a typical IT salary outside London, and there's plenty of downward pressure on wages. Only someone very unwise would take out a mortgage based on that salary when if anything happened to that employer, there's hardly a long list of other employers offering similar salaries.

I could believe the OP got lucky enough to be paid this and wants to show off. I don't believe such a person would fall into the trap of buying a house right now.

Enjoy it while it lasts. In IT you're pretty much on the scrap heap at age 35 ( age 30 for some people).

I advise stashing some of that cash away for a rainy day. Certainly some of my ex-IT-contractor-turned-postman acquaintances are glad they did...

Im not kicking myself

The crash was due in 2004 but the goverment dropped rates & Brown fiddled with things to postphone it.... BIG MISTAKE

3 years later :
- The government is forced to take on 110 billion pounds in debt rescueing Northern Rock
- Banks forced to take away 100% mortgages etc
etc etc etc ETC etc...

Good post, enjoyed that, although reminded me of one of those long business studies questions...

Richard and Andrew are graduates. Both are working class boys making good - Richard went off to one of the best universities in the country with 12 Grade ‘A’ O levels and 4 Grade A ‘A’ levels. Andrew with his BCD ’A’ Level grades was off to a minor university. Richard did well a first in mathematics - graduated in 1987 companies falling over themselves to employ him - he lands a job paying triple what the rest off us earn. Buys a new build in West London 1988 because that’s what the young upward professionals were doing at that time. I remember seeing his new house with Andrew and thinking if that’s what he can afford there’s no way we will ever get on the property ladder…. Cut to 1996 Richard was looking at £40,000 negative equity, Andrew has finally got a career but not a salary in Richards league. Andrew buys a three storey terrace house in sw London needs decorating and a bit of work but nothing major. Richard’s family is growing and the second bedroom isn’t so big when all the baby’s toys are in there. He sells at a loss and moves out of town buys another nice house in a cul de sac in Hampshire. Both friends have great families both have done well… but despite never earning the figures Richard commands Andrew now lives in a house Richard could never afford.

Question 1 (35 marks)
i) Andrew survived university without State or parental contributions. Assuming he worked in a part-time capacity to fund his education and saved 10% per annum to supplement his Subsistence Grant, in what year did Andrew become cashflow positive? 5 marks
ii) Richard spent a large part of his income on cigarettes and Club International. Discuss. 15 marks
iii) What colour was Andrew's best pair of trousers? 15 marks

I agree with the rest of your post, but that's nonsense.

i) It was the 80's fees, a living grant and the ability to sign on as unemployed during the holidays was still funded by the goverment. I believe the unemployment benefit was reduced to just the summer holidays after my second year.
ii) Richard did smoke but he never inhaled.
iii) As far as I am aware he still wears the same blue jeans he wore to college.

This is one of the most sensible things to do.
Do it at the start because it gets harder to share with a stranger the older you get.
Put all the money they pay as rent, against paying down the mortgage as fast as possible.
Dont paint everything beige.

Re: Solicitors wages on the south coast

The average wage I would say is less than 30k for most salaried solicitors. That means the ones who come in early, work through lunch and stay until 6.30 most nights. The wages are not as high as you would think. That is also for conveyancing which normally pays quite well, conveyancing tends to bring plenty of money into a firm. When you think that a teacher earns more, has a better pension, works the same hours term time (good ones) but has twelve weeks holiday a year. Solicitors get crap pay really down here.

so the concensus here seems to be that if most 25 year olds in Brighton earned £45k, then flats there would actually be affordable on a mere 5x salary mortgage multiplier.

BUT you are far more likely-%age wise to be working in a call centre than earning 35K

great post.And very very true.


conveyancer,you are bringing some new angles to threads.You are one of the few legal eagles floating here.I hope you will update us regularly on transaction levels,pulling off mortgage offers etc.

Yes they are:

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I'm in a 3 bedroom house just off the coombe rd too, the 3 bedroom neighbouring house has been on the market for over a year, the owner has reduced the price a number of times and has finally accepted an offer (although even he thinks it'll fall through).
My rent for an almost identical house is £800pcm, his is under offer at around 300k. Given that he's reduced his price several times indicating the possibility of a falling market, which do you think is good value?

Good luck, you may need it.

Bear buys house for £200,000; prices fall to 50% of that value over 5 years.

Goat then buys house for £200,000, exactly twice the size of bears house.

10 years later prices have returned to their starting point.

Bear is happy because he's not lost money over the long term.

Goat is happy because he's twice as rich as bear.

Opportunity Cost

You can have an extra £0 in ten years time by buying now or £50K by wating 3 years. Is it that hard?

I'm 36 next week

those are reductions - the last one (not sure where its gone on this quote) lost that value in a month - despiration to sell? reductions will happen at any point - even in the biggest areas of HPI, some people will still overvalue and have to take cuts

http://www.home.co.uk/guides/house_prices_...&lastyear=1



no real drops of yet.



which road out of interest? most houses around this area are identical (2 front doors next to each other, with little porch, then a bay window etc), so if one is selling for 300k, a 30% drop (90k) would take it down close to the 214k amount i've paid

My consignment to the IT scrapheap happened at age 31, after 12 years of working my tits off at a high level & sacrificing friendships, relationships, and developing a massive booze/herb habit (the latter gone now). The IT industry is a pile of shit, almost totally de-commoditised nowadays. Wish I had learned a proper trade, but for all us late 80s schoolkids, working in IT was absolutely encouraged...

The OP troll is going to find his ass outsourced or the industry moving in ways he cannot predict or react to. No skillset is immune, and even if he moves into IT management, that's even more risky an area than being a techie - as well as attracting some of the biggest c***s you could ever meet. Trust me, I know...

And the OP troll will realise by his late 20s that there are people nearly 10 years younger than he is, who are far more capable & cheaper to employ than he is. And at that point, he will start feeling a bit shaky, given a massive mortgage with 20+ years left, a house worth 50% of what it is now, and those 'learning how to spend your salary' habits firmly established.

Good luck, OP. You will certainly need it. Sorry for shattering your dreams mate, but the IT industry eats people & shits them out the other end in record time. You're foolish in the extreme to commit to a £1150/month mortgage when Job Seeker's Allowance is about £140/fortnight IIRC.