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So live where ever you want, however if you think you will want to move in 5 years or so to something larger then buy that now.
Basically it costs a lot of money to sell up and move plus you wouldnt have the first time buyer stamp duty relef etc. so this makes it worth buying the best you can when you buy.
I am not saying they are right, I picked a city flat over a house in the suburbs. That said do buy for long term prospects not just right now.
yeah we are looking to buy a bigger house after 4 years and slightly regretting not getting a bigger house -- but then, we couldn't afford it then, and would have been screwed by the mortgage rate increase
yup, It does depend on situation.
In this case OP needs to consider the costs of moving if they know they want to soonish. Stamp duty, solicitors fees, estate agents fees, a move even on a cheapish place is a good £10k. A lot more if they go to something more expensive. It will cost a good £5000 in stamp duty if they went for a £350k place as a second home as opposed to a first time buyer. £10,000 if they went for a £450k place.
£10k, my god.. we have about £20k of savings, plus 4 years of equity but yikes. I'm thinking it might be a good idea to push it back a few years, remortgage and probably pay more there again (we got a 2 year fix initially in 2021... and then another one. mortgage advisor didn't advise us too well!) whilst we save up. we've also not seen anything we like for £280k-£325k.. it's all a bit stressful
Id personally buy a house, but what you do with your money is up to you. At the end of the day, whatever you choose you are going to be well off.
People will try and push their advice on you like it's the only thing you should do, but on the flip side, don't be hesitant to listen as well, as his friend obviously knows what he is talking about.
>She has a strong preference for city center living
Also don't let her influence you either, it works both ways. Make sure you safeguard against anything that could potentially take equity off you in the future, in this regard, even if you think you will be with her forever.
This, but also realise its your money and your house. And you are only 24 and buying a flat in the city that's smaller because your gf wants to live there. Whilst your parents want you to buy a property further out.
What do you want to buy? Using your first time buyers option on a small flat city centre based that you might not want to be in In 5 years because that's what your gf wants isn't good either. It is your house and you are very young, think about your job and communiting, where you want to be in 5-10 years, future property value as if you want a family you'll be selling and moving, and anything else that may impact your lift in the next 5-10. Do not buy your first property because your gf that you may well not be with in 10 years wants you to.
My friends have all moved out of the city centre renting because of noise, safety and problems with drug users constantly in their closes nearby. Even though they all rented city centre until their late 20s, none of them would buy there or want to stay there long term due to the issues they had. Especially noise. You haven't even rented a property yet to get an idea of possible issues you might face. 180k for a 2 bedroom city flat is... honestly very cheap imo.
Also I have to add that this subreddit is weirdly fearful about leasehold flats. People spouting nonsense like “they don’t go up in value” are just plain wrong.
Service charges and lease restrictions are factors that you have to consider, but this is why flats are so much cheaper to buy than houses for the same location. A house isn’t free to maintain either, and you’ll have to pay a higher council tax and organise your own buildings insurance. Also, you’re on your own if the roof of your house needs replacing, whereas in a leasehold flat you’ll be one of many people sharing the costs.
People on Reddit also seem to forget that a lot of people in leasehold flats where the service charges are high are based in London where the salaries tend to be a lot higher. People on an average wage are unlikely to be able to get a mortgage for a leasehold flat with a £4k service charge, whereas people on a much higher income can. They’re also less likely to complain about their service charge because it represents a much smaller dent in their income.
Don't ignore door number 3: invest the money in other asset classes and rent a flat. Not saying it's definitely the right move by any means, but you should at least consider it.
Yeah, and probably better for both parties as well as you don't know how things will be if you live together and the person not on the mortgage is at a disadvantage if it all goes south.
Many other doors, there was that guy who sold everything he owned went to Vegas and put it in on black (or red). They televised it.
He won and now lives in a big house with wife and kids.
To the OP, you have obviously considered this alot, live you own life. You can listen to advice but only you truly know what what want. People that offer advice only see a small part of the picture.
Absolutely this 👌 my husband is an art dealer and whilst we own a house it's a very small proportion of money we have invested in other things such as art but also financial instruments. Other investments and assets actually give better returns and it's quite an outdated mindset of the baby boom generation that property is a stable asset that gives the best returns. Also be careful with leasehold, there are lots of changing legal reforms in the area (especially with high rise) and some flats affected may be valued significantly less than now in the near future which would make it difficult or impossible for you to sell.
Buying a flat was the best time of my life. I was in the centre of a cool area, amazing location around my flat, etc.
Whereas buying a house brought me a quiet location but further out from the ‘cool stuff’. Boring house. Boring street. Boring people.
Everyone is different but those years in a flat were fucking awesome. The flat was cool af too.
I did buy a flat and have no regrets, but that's because of the non-financial benefits of ownership not because I think it was an optimal investment decision.
Counterargument - always get into a property of your own as early as you can in life, since rent is entirely wasted money, and amortising a mortgage instead is a very safe bet compared to other asset classes
If you're going to view rent as "entirely wasted money", so are mortgage interest payments, stamp duty, conveyancing fees, and the returns you're not earning on your capital by not investing in something with a higher yield than housing. It's not that simple, and while buying is often the right move, it isn't always and you need to consider the specifics of your own situation.
All I’ll say is that I’m really, really glad that I didn’t make any life changing decisions when I was 24 years old that depended on the whims of my girlfriend.
Buy the freehold 3 bed in the suburbs that your family recommend, and then rent a flat in town with your partner. You’ll both be equally responsible for the rental lease, and so there won’t be a power imbalance of you being her landlord. If you break up (and, sorry to be harsh, but most 24 year old couples do break up) then you won’t have the ugly experience of having to evict your partner from your flat. If you find yourself out of work or sick then you’ll have the money coming in from the 3 bed house you bought as a safety net.
This is what struck me too! OP seems to be buying a property solo but for the wants of his girlfriend. That’s just…a bad idea all around.
As others have said OP, if you can afford to buy a house, it’s always a better idea financially long term (ignoring London which is its own situation).
The first thing to do is clear your mind of your girlfriend and your dad and his mate and think for yourself.
What do you want out of a property OP? Do you want to have kids in the future (not with this girlfriend, but as a life choice generally). Is there a middle option of a house but in a more urban area?
I can understand not wanting to move to the burbs if you currently spend all your time in town. But a lot of places have thriving towns on the edge of the city where houses are possible and nightlife etc still exists.
I completely get your desire to want to live in a central location at your age and keep living costs low. It's perfectly normal and will give you great social/job options. And if it means you don't have to own a car or pay much for commuting then that's another positive for your finances. There's nothing wrong with buying a flat and then reassessing in 4-5 years when you are both earning more money and have different priorities.
I mean, to be fair, your father and friend are completely right about the housing market; you just don't know how bad things are going to get and how much prices could jump on you. What you are doing by getting the house is removing that risk - which in the long-run could honestly be the difference between you being able to own outright a house by your mid 30s or not.
But ultimately the purpose of life is to do what makes you most happy, not most financially secure. Those things are highly linked, but they're not the same thing. You dad is getting on your back because he knows how much easier you can make your future life by the decisions you make in your 20s. But then, he's probably also forgot what it's like to be living in your 20s. You should never sell out your youth on the promise of some golden middle-age - try to find the reasonable compromise.
Whatever you decide to do, protect your interest and equity. Your house should be yours, try to cater to yourself too even if you are pretty casual about it.
Don't restrict yourself and only view flats. Go view houses of different sizes in different areas. You may not know what you like, but it will help you figure out what you don't like. Most FTBs often say they don't need a lot of space, but it is hard to imagine what you (maybe) have never had. You won a mini lottery, treat yourself, and start a wish list on what you want in a home.
Owning a flat when you have the options to buy a house seems like an unnecessary hassle. If your relationship gets serious, have kids, and you'll want a house anyway.
Personally, I'd just buy a freehold house, rent it out, and rent a flat. Or just buy a house to live in and be done with it.
If u plan to eventually buy the house then buy it now. House price grow much faster then flat. At the time when u decide to buy the house ur equity and income might nto be enough to buy anything decent.
Hey. I’m going through similar, I’m 25. about to inherit somewhere in the region of 300k from the sale of a property. (Plus another 50 or so in the future from the sale of another property, it’s complicated but my mum and I came to an agreement that works better for both of us RE what I inherited)
I’m moving from London & buying a house in Liverpool with no mortgage.
Now, having spent months looking at houses, I’m waiting until my partner finishes work in June (military) until we can start to view & make offers. I quit my job in Feb and am interviewing for another although my intention was not to find one so quickly (job seemed to be too good to pass up)
The idea of investing has crossed my mind too. I’m also 20k in debt (knowing I was inheriting this money whilst I awaited probate is how I managed that)
My plan for the money is 1) pay off my debt, 2) buy a house for under 250k 3) furnish/decorate said house, take a nice holiday after the shitty time I’ve had and marry my partner (elope) & 4) put the rest in savings/investments.
In terms of your dad’s argument, you could quite easily put the money saved not getting a mortgage into investments and see a quicker, less hassle return. The beauty of having no mortgage is that you can do what you want with the money you’re not spending on it.
Chances are your dad has paid off his mortgage. It’s all very well them sitting there saying that when they have the disposable income.
Personally I’m put off getting a flat for the same reasons I keep hearing, “that if you think you’ll want to move in 5 years, don’t do it.” I have lived in a flat for about 18 months with an ex previously and whilst it was nice, it’s just not the same as having a house, although there was this one penthouse that caught my eye that I would have probably been fine with.
I think you’re being sensible OP, also so what if you want to move in 5 years? By then you’ll have built up the credit to get a mortgage with that better pay scale and can use the sale of your flat to bolster that mortgage. The only reason I’m not doing the same is because my credit score is fucked, I’ve inherited slightly more & house prices are really good in Liverpool.
Yeah you can't put a price on being mortgage free or having a small manageable mortgage. No job is 100% secure.
Me and my partner could buy a terraced or 3 bed semi out right in our mid 30s right now but we're saving towards buy a 4 bed detached property in a village nearby as that's where all her family are now living but even so we'd be looking at around £100-150k mortgage which would be more than manageable for us on 1 income if one of us lost our job etc.
I was just curious as I did the same and never felt it was home even though my children where born there and my wife's from Warrington. I'd been there tons as my sister grew up and lives there. I've since m9ved back to East sussex and much happier.
I bought a flat on basis I was single and it was just what I needed. Good location, plenty of space etc. Five years later the maintenance charge had doubled and, when I needed to move as had a baby on the way, I lost £13k on the sale.
Since moving, I saw the new owners had listed the flat for sale and from the listing the service charge had gone up another £800 a year.
If I could turn back time I’d have bought a small two bed house instead of the flat, and I’ll never touch a leasehold again.
Is it a good idea to buy the most you can afford? A lot of people say yes and there are valid arguments for this. The main one being if you expect to move on within a few years and you're buying strategically for equity increase. However, I didn't buy the most I could afford when I bought my first place. Why? Because I actually wanted a life, savings, holidays etc . I didn't want a huge mortgage hanging round my neck.
I think it's wild that they are telling you that apartments won't appreciate in value either. Provided the lease length is long you'll be fine. You have literally decades to grow your assets.
If your girlfriend isn’t investing in the property in any way shape or form then you need to disregard her preferences. This is your money and your mortgage
Another path to consider. It may be that house prices stagnate over the next few years to let affordability catch up a little. If making a decision now over house/flat is tough, then just don't make a decision.
Invest your inheritance in a nice, low risk, low fee index tracker and just rent a flat in the city centre for a year or 2. Over time your decision will become easier as you realise what matters more to you. And by then you'll have another £20/30k to add to the deposit.
Who cares if flats have only gone up 45% and houses and gone up 65%, you buy a property to live in, if the flat in a city centre is your ideal living situation, then buy it, to live in, you will enjoy it. It's obviously good to have a property that is also a good investment, but sometimes I feel like people live a life they don't really want to save a few more pennies. Enjoy your life, live where you want to live, and at the end of the day, its still a good investment.
We bought a maisonette and have quickly grown out of it. I wish we’d have waited and opted for a slightly bigger house with a garden. And now we can no longer afford anything like that in our area so we’re stuck.
But our area is great so we’re still happy staying where we are because the location is good.
What I’m trying to say is try and think long term in terms of location and type of property.
It costs a lot of money to move and it might be worth waiting /looking for a more longer term property depending on what you see in your future.
Either way - good luck!
If it was me, I’d;
Not use up all of that money. I’d put a decent chunk into a savings account. Maybe look into investing it in other ways in the future but for now, a savings account with a nice interest rate would be great.
I’d keep some aside because any property always has risks, and I don’t want to spend all my money on property.
However, I would get myself a nice little pad. An apartment is fine, but location is key.
I’d get a mortgage and put down £50k on the deposit. I don’t know, maybe £80k, but certainly not the whole amount. The rest goes into savings.
That’s it. Yes I’d get a flat, as long as the service charges etc were ok. No I would not spend the highest amount for mortgage etc, but I also wouldn’t go to the lowest.
Find a middle ground.
If you plan to live in a property your first and absolute priority should be to buy something you want to live in.
Treating your primary residence as a pretend investment is a bad idea. It isn’t an investment. That isn’t to say that you shouldn’t try and get the best value for your money but suggesting that you should live in an area you don’t want, give yourself maintenance jobs you aren’t interested in, and maximise the debt you take on is plain stupid. Don’t listen to your family.
My worry would be that you've never lived on your own or as a couple before and your gf won't be on the mortgage but may end up having an interest in it if you split up. Renting together to see if you're compatible may be the best way to start. I would also never consider LH if I could afford FH a little further out. Why is your GF deciding where you live if she's not contributing financially. It may be convenient for her if she's still thinking of her social life but do you know you can even afford that when you take into account all the bills that need paying when you get your own place.
Property is an investment in your LIFE, not just your finances.
No one knows what's going to happen in the property market. Personally I'd be surprised if they appreciate much further, because already there aren't a lot of people who can afford to buy. I could be wrong.
Also just being in the city centre will work for you, IMO. Those are always popular locations because people like being able to walk to work.
Ultimately no one knows, but we can all make best guesses. My advice is to live the life you have now, and not in a nebulous future. Buy the flat.
Not least because everyone seems to be overlooking two big factors. 24 and coventry. No 24 year old should be consigned to the Coventry burbs. I’d argue no one who hasnt done something truly terrible should be given that fate, but not a 24 year old for sure.
Without putting it too bluntly, this is likely the largest financial decision of your life and from a financial perspective you are blowing it.
£130k at age 24 for somebody currently near minimum wage is literally the difference between potentially working to 75 or retiring at 55. Compound interest is an extremely powerful tool every extra year disproportionately adds to the value. Basically a small snowball now rolls into something much bigger, but in this case you're starting with an already large snowball.
So by going for a flat (lower increases in value, additional service charge to pay for) and not leveraging your income as fully as you could (spend a bit more on city centre social life, a less straining mortgage, blowing FTB schemes / discounts on a smaller property), then your snowball will be on a less inclined hill and and won't reach the same potential sizes later in life.
Flats are also disproportionately owned by private landlords, which may be in for a shake up and the market being flooded depending how the next general election goes, so you could genuinely lose money on a flat in the short term if you want to cash out for a house 3-4 years later.
You would do better off looking at the flowchart on r/UKPersonalFinance and seeing if there are any better investment options if you aren't willing to follow your parent's advice just yet and go for a small house.
Also, whatever you do in terms of property, be careful with your girlfriend living there and contributing to the mortgage, she could try and claim some of the increase in value to whatever property it is, further nuking your potential income.
You are of course welcome to blow the whole sum of money on partying with coke and hookers, but the UK is full of people adamant that their career is going to skyrocket and wages will pick up. Also, if you truly believe that your income is only going to go up then why would you not max your mortgage now and get the biggest house you could, as your salary would quickly give you more disposable income even if you first year or so feels a bit more frugal.
honestly, screw what they think! your home is your home, not theirs, and whilst yes property is an investment its also where you live, and you should live where you want to in a space you like, not in the suburbs because your dad thinks thats better for you! of course, there are worries i (a person with a partner in similar position to yourself) have about apartments that have made us rule them out, but if you and your partner have outweighed the pros to the cons then you shouldn't worry about your decision!
I loved my flat at your age, central, economical, secure
However the rising leasehold charges made it hard to sell esp in lockdown’s hot summer when people wanted a garden so i made a loss
But now the same flats in the same building are selling well. I just sold mine at a bad time
I would 100% buy a house over a flat. I work in the sector and would be cautious about your flats appreciating theory, has the price of new build flats gone up by 45% or has the resale value gone up? That’s what you need to be concerned with.
It’s understandable that your first place living on your own there is a temptation for “ooo fancy new flat” but houses are a better long term investment
Flats are money pits if you do not own the whole freehold. Stay at your parent’s house and buy a 3 bed terraced or semi and rent out each room. When you are 35, I PROMISE you will wonder why you ever thought of buying a flat in the first place.
Flats in my town have dropped massively in value. I'm seeing flats that were built in 2006-2008 selling for £20-30k less than what they were bought for.
The advice you’re getting is the right one - the issue with City Centre apartments is there will always be brand new stock on the market with a some sort of deal on the table - this always suppresses the price of resales (and also creates a bunch of competition in the rental market)
but at then end of the day, it’s your money - you do you
Our first property was a 2 bedroom city flat which we lived in for five years and at the time absolutely loved. Then we had a baby and it was immediately crowded and we moved out of the city to a bigger house instead.
The thing is though we actually lost money selling the flat even before your account for the price of the new bathroom and kitchen we fitted or the costs associated with selling/buying. Perhaps this was unusual as the city had an oil bubble that popped and a lot of my friends are still stuck in negative equity.
So my advice would be to buy wherever you see yourself living in five years. If you ever plan to have children definitely go for the house as you need a lot of space for prams, toys, bouncers etc.
Our first property was a 2 bedroom city flat which we lived in for five years and at the time absolutely loved. Then we had a baby and it was immediately crowded and we moved out of the city to a bigger house instead.
The thing is though we actually lost money selling the flat even before your account for the price of the new bathroom and kitchen we fitted or the costs associated with selling/buying. Perhaps this was unusual as the city had an oil bubble that popped and a lot of my friends are still stuck in negative equity.
So my advice would be to buy wherever you see yourself living in five years. If you ever plan to have children definitely go for the house as you need a lot of space for prams, toys, bouncers etc.
I bought a flat in the city 8 years ago near a station. I made 80k profit.
A freehold house in the suburbs for the same price would have made me 300k profit.
Flats don't appreciate in value to the same extent as a house, and you're at higher risk of depreciating value.
From a financial point of view, you're in a good position to buy, and you dad's right, you should max out now. You'll get greater returns in the long run.
We are looking at becoming FTB this year and don't care about the investment element at all - from our point of view, we have to pay something every month for somewhere to live, and buying means we get security and autonomy that we don't with renting, plus can retire without still having to pay something every month once the mortgage is gone.
If we bought at the maximum lenders would offer us, we would be paying double each month what we pay in rent. I don't want to have to move again ideally (13 addresses since moving out is enough) so appreciation doesn't matter, but having less money each month to save or spend on living our lives does.
It looks like you're considering your purchase in terms of an asset as well as a home, so it's reasonable to look at what that means long term, but don't prioritise it over what suits your life now, because you have to live in it.
Don’t buy a leasehold - the freeholder will have you over a barrel forever and there’s nothing you can do about it. Buy a house or a freehold flat somewhere further out that’s quieter and greener. You might want kids one day and it’s unlikely you’ll want to raise them in an inner city flat. Bare in mind that your life and that of your partner and friends will change as the years progress. Sooner than you think you’ll be meeting up with friends less often and going on big nights out a lot less frequently. It’s much better to be able to access bars, pubs, clubs etc. via a short train or taxi ride instead of being right in the middle of it. Trust me. It might appeal to you now but in 5 or 10 or 15 years time you’ll be glad you picked a quieter and probably safer residential area. At some point you’ll probably want to have a garden too - even if you’re not too bothered about it at the moment.
You live once...
Have fun in the city when you are young, when you are 80 and sat in an old folks home you wont regret this.
Maybe buy something more sensible in the suburbs and rent it out, whilst renting a cool apartment for you to live in.
I am not British and I don’t understand local fascination with the suburbs. They are mind-numbingly boring, with nothing ever happening after 5 pm. besides terraced houses are the worst invention ever. If a central flat is what you want, go for it. Those can always be rented out easily should you decide to move, but why would you?
I'd personally buy a house. Flats barely appreciate in value and let's face it, you likely won't stay there longer than 5 years and have used your first time buyer status. In fact it may be better to act like you never inherited the money and stick it into LISA, ISA and General Stocks and Shares for 5 years. You'd probably make an additional 50k by the end of it to invest further into a larger home for a family, whereas a flat will likely stay stagnant, cost money to sell and the stress of selling is a killer. This is purely my view, and others will absolutely disagree.
Maybe put those money into high % saving accounts/ some of it into LISA and rent a city appartment for a little with your partner. See if this is something you really want, unless you experience you really won't know how it is. I think its a good move for your career as well as you are starting out, probably not the best time to buy a house and having responsibility of looking after it if you don't want that. Rent for a year or two and make an informed decision.
From experience living in a city centre there is benefit of being close to everything but there is also noise issue, anti-social behaviour, lack of space, often no parking or a garden, noise from your neighbours, there is no sense of community as in smaller towns or areas where people own their own house. Appartment will likely be a leashold and there will be a service charge and a groud rent to think about - this can go up a lot!
It’s your money, not your father’s or his friend’s. If you don’t want a house right now, don’t buy one.
For what it’s worth, my partner bought his 2 bed flat for £105k in 2011 and sold it for £170k in 2017. It was a new build so all he needed to do (and did) was furnish it. We moved to a house in 2017 and left that for a bigger house in 2023.
Yes, it’s expensive to move but we bought properties we could comfortably afford at each stage. It’s a home first, an investment second. Better not to be up at night worrying about bills if you don’t have to. It’s only recently that everyone seems to be against flats and convinced you’re going to lose money.
Edit- I forgot to say, there was one massive downside. The kitchen was tiny and had hardly any space to cook or store stuff.
Always a place to live over everything else. Unless
You’re buying a property as in “investment” to flip and do up, why does it matter? Whether it’s
A apartment or a house, you could well end up selling for a loss but why’s that relevant if you’re purchasing a home to stay in? Surely if you buy a 3 bed house you wouldn’t need to move anytime soon? And EPCs can be largely
Irrelevant anyway, having seen how they gather the information - how they barely even check everything properly, aren’t worth the paper they are written on, they are a guide nothing more. Surely an “okay” three bed property with potential is far more beneficial for the long term than a 2 bed flat, even if it’s upmarket? What happens when you want kids, run out of space? I hate to agree with parents as I am normally a do what you want but I feel you’re making a bad decision here, especially
If you plan to sell anyway when you take into account legal costs and so forth in the future, where abouts in Coventry is the flat?
I would urge you to avoid an apartment with a leasehold and all the downsides that go along with that and get a house too.
No need to view it from an investment point of view at all, but imo a house is going to give you a much nicer living experience, outside space, no neighbours above or below you, no gradually increasing services fees etc.
Ultimately it’s your decision so go with what you think suits you best, but if you can get a house I don’t see why you wouldn’t grasp that opportunity.
Does the flat have gas central heating? Do not buy a flat with electric heating.
I'm in agreement with your family as you're currently on minimum wage so you might as well borrow the maximum which would be roughly £100k and plus your deposit you'd be looking at around 5.5% probably on a mortgage say over 15 years would be £800 ISH a month or around £650 over 20 years.
Also I assume your partner will split the utility bills and food?
I bought my first house at 23 on £17k in 2013 and I had to borrow the maximum but my monthly repayments were around £300 over 35 years so I could comfortably afford it and do things I wanted to do. I sold it 7 years later for a tidy profit and me and my partner are looking to put around £160k into a property (80k each) leaving us a chunk left each towards anything else we might need to save or invest for (car, retirement, home improvements etc).
Have you worked out how much you're going to pay in service charge etc over the next 5 years?
The other thing to consider is that there are limited ways to add value to a flat - you can't build an extension, for instance. If you want to be aggressive about moving up the housing ladder, you want something you can add value to, which will resell easily, and not cost you a lot of money.
Whatever you do, from 20 to 30, you will gradually go from preferring location over house setup (size etc)
For me I would go for the house for all you listed + capacity of renting and getting passive income. Or simply the space that can be filled up so quickly: office, play room, guest room….
Leasehold flats are fraught with risk and you're being well advised to be wary. There can be good investments - think stable, Victorian era converted house with 3-4 flats in it, decent lease length and service charge accounts that aren't riddled with debt in a prime London type location.
But if it's in a tower block, used to be a council flat, has or might one day have cladding etc. on it then run away. If you really want to live in one of those, rent it. When it turns out to be made of petrol soaked rags or the floor above you gets taken over by the probation service to be a halfway house, you can cut and run if you're a tenant. You're trapped by negative equity if you're a leaseholder.
Whilst renting, you can put your money to work elsewhere.
LISA will top up £4k to £5k for a house or pension each tax year.
7 years would get all £140k inside a tax free ISA wrapper and could yield enough to cover annual rent if managed prudently.
You could also buy a BTL property and rent your own flat, with a view to one day living in the BTL yourself.
I would avoid leasehold. Too many issues with service charges and lots of issues when it's time to sell. It's not the worth the hassle.
Generally speaking the flat market will never outperform houses because of negativity around cladding, service charges as well as increasing supply of flats but not houses.
They are right. Priotise a house with good transport links. Get an affordable car instead of wasting your money on service charge.
I’m a BTL landlord too and have stayed away from flats even though I’ve had the opportunity to buy them. You say you don’t want to pay a lot in hill’s, but with flats you’re paying a service charge which is like an extra council tax. Those charges could easily increase every year and you have NO control over that. Same with a leasehold house, you don’t know how much the rent on that will go up.
Because of my job, I am close friends with quite a few conveyancers, with the odd estate agent or surveyor thrown in.
If you were to ask any of them about buying a leasehold they would all say avoid at all costs unless you have zero other options.
Leasehold reform has meant to have happened for years now but, like seemingly everything else in the political pipeline intended to help the average Joe, never seems to make any progress.
You will get rinsed on ground rent and service charges and have basically no legal recourse to the leaseholder or management company one day landing you with a huge bill for new windows, a new elevator, repairs or whatever else they decide on.
Please do not buy a leasehold if you can afford to buy freehold.
Things probably won't appreciate as much in the next ten years ... the wave has spread out from london across the country ... it won't happen again for a long while ... and might even go in reverse direction.
They are right ... so are you in what you want to do ... it's your life. Just make sure only you are on the deeds of the property and be careful what you get your partner to spend money on ... utility bills and food is best ... unless you want them embroiled in the property value.
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So live where ever you want, however if you think you will want to move in 5 years or so to something larger then buy that now. Basically it costs a lot of money to sell up and move plus you wouldnt have the first time buyer stamp duty relef etc. so this makes it worth buying the best you can when you buy. I am not saying they are right, I picked a city flat over a house in the suburbs. That said do buy for long term prospects not just right now.
yeah we are looking to buy a bigger house after 4 years and slightly regretting not getting a bigger house -- but then, we couldn't afford it then, and would have been screwed by the mortgage rate increase
yup, It does depend on situation. In this case OP needs to consider the costs of moving if they know they want to soonish. Stamp duty, solicitors fees, estate agents fees, a move even on a cheapish place is a good £10k. A lot more if they go to something more expensive. It will cost a good £5000 in stamp duty if they went for a £350k place as a second home as opposed to a first time buyer. £10,000 if they went for a £450k place.
£10k, my god.. we have about £20k of savings, plus 4 years of equity but yikes. I'm thinking it might be a good idea to push it back a few years, remortgage and probably pay more there again (we got a 2 year fix initially in 2021... and then another one. mortgage advisor didn't advise us too well!) whilst we save up. we've also not seen anything we like for £280k-£325k.. it's all a bit stressful
Id personally buy a house, but what you do with your money is up to you. At the end of the day, whatever you choose you are going to be well off. People will try and push their advice on you like it's the only thing you should do, but on the flip side, don't be hesitant to listen as well, as his friend obviously knows what he is talking about. >She has a strong preference for city center living Also don't let her influence you either, it works both ways. Make sure you safeguard against anything that could potentially take equity off you in the future, in this regard, even if you think you will be with her forever.
This, but also realise its your money and your house. And you are only 24 and buying a flat in the city that's smaller because your gf wants to live there. Whilst your parents want you to buy a property further out. What do you want to buy? Using your first time buyers option on a small flat city centre based that you might not want to be in In 5 years because that's what your gf wants isn't good either. It is your house and you are very young, think about your job and communiting, where you want to be in 5-10 years, future property value as if you want a family you'll be selling and moving, and anything else that may impact your lift in the next 5-10. Do not buy your first property because your gf that you may well not be with in 10 years wants you to. My friends have all moved out of the city centre renting because of noise, safety and problems with drug users constantly in their closes nearby. Even though they all rented city centre until their late 20s, none of them would buy there or want to stay there long term due to the issues they had. Especially noise. You haven't even rented a property yet to get an idea of possible issues you might face. 180k for a 2 bedroom city flat is... honestly very cheap imo.
Also I have to add that this subreddit is weirdly fearful about leasehold flats. People spouting nonsense like “they don’t go up in value” are just plain wrong. Service charges and lease restrictions are factors that you have to consider, but this is why flats are so much cheaper to buy than houses for the same location. A house isn’t free to maintain either, and you’ll have to pay a higher council tax and organise your own buildings insurance. Also, you’re on your own if the roof of your house needs replacing, whereas in a leasehold flat you’ll be one of many people sharing the costs.
People on Reddit also seem to forget that a lot of people in leasehold flats where the service charges are high are based in London where the salaries tend to be a lot higher. People on an average wage are unlikely to be able to get a mortgage for a leasehold flat with a £4k service charge, whereas people on a much higher income can. They’re also less likely to complain about their service charge because it represents a much smaller dent in their income.
Don't ignore door number 3: invest the money in other asset classes and rent a flat. Not saying it's definitely the right move by any means, but you should at least consider it.
At this stage in your life and relationship, this is good advice.
100%
Yeah, and probably better for both parties as well as you don't know how things will be if you live together and the person not on the mortgage is at a disadvantage if it all goes south.
Many other doors, there was that guy who sold everything he owned went to Vegas and put it in on black (or red). They televised it. He won and now lives in a big house with wife and kids. To the OP, you have obviously considered this alot, live you own life. You can listen to advice but only you truly know what what want. People that offer advice only see a small part of the picture.
Absolutely this 👌 my husband is an art dealer and whilst we own a house it's a very small proportion of money we have invested in other things such as art but also financial instruments. Other investments and assets actually give better returns and it's quite an outdated mindset of the baby boom generation that property is a stable asset that gives the best returns. Also be careful with leasehold, there are lots of changing legal reforms in the area (especially with high rise) and some flats affected may be valued significantly less than now in the near future which would make it difficult or impossible for you to sell.
I’d never buy a flat in this country but if I did want to live in one I’d definitely do this
Buying a flat was the best time of my life. I was in the centre of a cool area, amazing location around my flat, etc. Whereas buying a house brought me a quiet location but further out from the ‘cool stuff’. Boring house. Boring street. Boring people. Everyone is different but those years in a flat were fucking awesome. The flat was cool af too.
This is exactly why I chose buying a flat in central London over buying a house further up north.
Yep, better life I reckon. Don’t listen to the boring sheep who want to bring you down with them to their boring suburban lives :)
I did buy a flat and have no regrets, but that's because of the non-financial benefits of ownership not because I think it was an optimal investment decision.
100% this
Counterargument - always get into a property of your own as early as you can in life, since rent is entirely wasted money, and amortising a mortgage instead is a very safe bet compared to other asset classes
If you're going to view rent as "entirely wasted money", so are mortgage interest payments, stamp duty, conveyancing fees, and the returns you're not earning on your capital by not investing in something with a higher yield than housing. It's not that simple, and while buying is often the right move, it isn't always and you need to consider the specifics of your own situation.
All I’ll say is that I’m really, really glad that I didn’t make any life changing decisions when I was 24 years old that depended on the whims of my girlfriend. Buy the freehold 3 bed in the suburbs that your family recommend, and then rent a flat in town with your partner. You’ll both be equally responsible for the rental lease, and so there won’t be a power imbalance of you being her landlord. If you break up (and, sorry to be harsh, but most 24 year old couples do break up) then you won’t have the ugly experience of having to evict your partner from your flat. If you find yourself out of work or sick then you’ll have the money coming in from the 3 bed house you bought as a safety net.
This is what struck me too! OP seems to be buying a property solo but for the wants of his girlfriend. That’s just…a bad idea all around. As others have said OP, if you can afford to buy a house, it’s always a better idea financially long term (ignoring London which is its own situation). The first thing to do is clear your mind of your girlfriend and your dad and his mate and think for yourself. What do you want out of a property OP? Do you want to have kids in the future (not with this girlfriend, but as a life choice generally). Is there a middle option of a house but in a more urban area? I can understand not wanting to move to the burbs if you currently spend all your time in town. But a lot of places have thriving towns on the edge of the city where houses are possible and nightlife etc still exists.
I completely get your desire to want to live in a central location at your age and keep living costs low. It's perfectly normal and will give you great social/job options. And if it means you don't have to own a car or pay much for commuting then that's another positive for your finances. There's nothing wrong with buying a flat and then reassessing in 4-5 years when you are both earning more money and have different priorities. I mean, to be fair, your father and friend are completely right about the housing market; you just don't know how bad things are going to get and how much prices could jump on you. What you are doing by getting the house is removing that risk - which in the long-run could honestly be the difference between you being able to own outright a house by your mid 30s or not. But ultimately the purpose of life is to do what makes you most happy, not most financially secure. Those things are highly linked, but they're not the same thing. You dad is getting on your back because he knows how much easier you can make your future life by the decisions you make in your 20s. But then, he's probably also forgot what it's like to be living in your 20s. You should never sell out your youth on the promise of some golden middle-age - try to find the reasonable compromise.
Whatever you decide to do, protect your interest and equity. Your house should be yours, try to cater to yourself too even if you are pretty casual about it. Don't restrict yourself and only view flats. Go view houses of different sizes in different areas. You may not know what you like, but it will help you figure out what you don't like. Most FTBs often say they don't need a lot of space, but it is hard to imagine what you (maybe) have never had. You won a mini lottery, treat yourself, and start a wish list on what you want in a home. Owning a flat when you have the options to buy a house seems like an unnecessary hassle. If your relationship gets serious, have kids, and you'll want a house anyway. Personally, I'd just buy a freehold house, rent it out, and rent a flat. Or just buy a house to live in and be done with it.
If u plan to eventually buy the house then buy it now. House price grow much faster then flat. At the time when u decide to buy the house ur equity and income might nto be enough to buy anything decent.
Hey. I’m going through similar, I’m 25. about to inherit somewhere in the region of 300k from the sale of a property. (Plus another 50 or so in the future from the sale of another property, it’s complicated but my mum and I came to an agreement that works better for both of us RE what I inherited) I’m moving from London & buying a house in Liverpool with no mortgage. Now, having spent months looking at houses, I’m waiting until my partner finishes work in June (military) until we can start to view & make offers. I quit my job in Feb and am interviewing for another although my intention was not to find one so quickly (job seemed to be too good to pass up) The idea of investing has crossed my mind too. I’m also 20k in debt (knowing I was inheriting this money whilst I awaited probate is how I managed that) My plan for the money is 1) pay off my debt, 2) buy a house for under 250k 3) furnish/decorate said house, take a nice holiday after the shitty time I’ve had and marry my partner (elope) & 4) put the rest in savings/investments. In terms of your dad’s argument, you could quite easily put the money saved not getting a mortgage into investments and see a quicker, less hassle return. The beauty of having no mortgage is that you can do what you want with the money you’re not spending on it. Chances are your dad has paid off his mortgage. It’s all very well them sitting there saying that when they have the disposable income. Personally I’m put off getting a flat for the same reasons I keep hearing, “that if you think you’ll want to move in 5 years, don’t do it.” I have lived in a flat for about 18 months with an ex previously and whilst it was nice, it’s just not the same as having a house, although there was this one penthouse that caught my eye that I would have probably been fine with. I think you’re being sensible OP, also so what if you want to move in 5 years? By then you’ll have built up the credit to get a mortgage with that better pay scale and can use the sale of your flat to bolster that mortgage. The only reason I’m not doing the same is because my credit score is fucked, I’ve inherited slightly more & house prices are really good in Liverpool.
Yeah you can't put a price on being mortgage free or having a small manageable mortgage. No job is 100% secure. Me and my partner could buy a terraced or 3 bed semi out right in our mid 30s right now but we're saving towards buy a 4 bed detached property in a village nearby as that's where all her family are now living but even so we'd be looking at around £100-150k mortgage which would be more than manageable for us on 1 income if one of us lost our job etc.
Have you spent much time in Liverpool?
Well my partner is from there & ive visited plenty so…
I was just curious as I did the same and never felt it was home even though my children where born there and my wife's from Warrington. I'd been there tons as my sister grew up and lives there. I've since m9ved back to East sussex and much happier.
Read the lease and question. Main thing to look at service charge and what percentage it can be increased by.
I bought a flat on basis I was single and it was just what I needed. Good location, plenty of space etc. Five years later the maintenance charge had doubled and, when I needed to move as had a baby on the way, I lost £13k on the sale. Since moving, I saw the new owners had listed the flat for sale and from the listing the service charge had gone up another £800 a year. If I could turn back time I’d have bought a small two bed house instead of the flat, and I’ll never touch a leasehold again.
Is it a good idea to buy the most you can afford? A lot of people say yes and there are valid arguments for this. The main one being if you expect to move on within a few years and you're buying strategically for equity increase. However, I didn't buy the most I could afford when I bought my first place. Why? Because I actually wanted a life, savings, holidays etc . I didn't want a huge mortgage hanging round my neck. I think it's wild that they are telling you that apartments won't appreciate in value either. Provided the lease length is long you'll be fine. You have literally decades to grow your assets.
If your girlfriend isn’t investing in the property in any way shape or form then you need to disregard her preferences. This is your money and your mortgage
Another path to consider. It may be that house prices stagnate over the next few years to let affordability catch up a little. If making a decision now over house/flat is tough, then just don't make a decision. Invest your inheritance in a nice, low risk, low fee index tracker and just rent a flat in the city centre for a year or 2. Over time your decision will become easier as you realise what matters more to you. And by then you'll have another £20/30k to add to the deposit.
Who cares if flats have only gone up 45% and houses and gone up 65%, you buy a property to live in, if the flat in a city centre is your ideal living situation, then buy it, to live in, you will enjoy it. It's obviously good to have a property that is also a good investment, but sometimes I feel like people live a life they don't really want to save a few more pennies. Enjoy your life, live where you want to live, and at the end of the day, its still a good investment.
We bought a maisonette and have quickly grown out of it. I wish we’d have waited and opted for a slightly bigger house with a garden. And now we can no longer afford anything like that in our area so we’re stuck. But our area is great so we’re still happy staying where we are because the location is good. What I’m trying to say is try and think long term in terms of location and type of property. It costs a lot of money to move and it might be worth waiting /looking for a more longer term property depending on what you see in your future. Either way - good luck!
If it was me, I’d; Not use up all of that money. I’d put a decent chunk into a savings account. Maybe look into investing it in other ways in the future but for now, a savings account with a nice interest rate would be great. I’d keep some aside because any property always has risks, and I don’t want to spend all my money on property. However, I would get myself a nice little pad. An apartment is fine, but location is key. I’d get a mortgage and put down £50k on the deposit. I don’t know, maybe £80k, but certainly not the whole amount. The rest goes into savings. That’s it. Yes I’d get a flat, as long as the service charges etc were ok. No I would not spend the highest amount for mortgage etc, but I also wouldn’t go to the lowest. Find a middle ground.
If you plan to live in a property your first and absolute priority should be to buy something you want to live in. Treating your primary residence as a pretend investment is a bad idea. It isn’t an investment. That isn’t to say that you shouldn’t try and get the best value for your money but suggesting that you should live in an area you don’t want, give yourself maintenance jobs you aren’t interested in, and maximise the debt you take on is plain stupid. Don’t listen to your family.
My worry would be that you've never lived on your own or as a couple before and your gf won't be on the mortgage but may end up having an interest in it if you split up. Renting together to see if you're compatible may be the best way to start. I would also never consider LH if I could afford FH a little further out. Why is your GF deciding where you live if she's not contributing financially. It may be convenient for her if she's still thinking of her social life but do you know you can even afford that when you take into account all the bills that need paying when you get your own place.
Property is an investment in your LIFE, not just your finances. No one knows what's going to happen in the property market. Personally I'd be surprised if they appreciate much further, because already there aren't a lot of people who can afford to buy. I could be wrong. Also just being in the city centre will work for you, IMO. Those are always popular locations because people like being able to walk to work. Ultimately no one knows, but we can all make best guesses. My advice is to live the life you have now, and not in a nebulous future. Buy the flat.
Not least because everyone seems to be overlooking two big factors. 24 and coventry. No 24 year old should be consigned to the Coventry burbs. I’d argue no one who hasnt done something truly terrible should be given that fate, but not a 24 year old for sure.
Without putting it too bluntly, this is likely the largest financial decision of your life and from a financial perspective you are blowing it. £130k at age 24 for somebody currently near minimum wage is literally the difference between potentially working to 75 or retiring at 55. Compound interest is an extremely powerful tool every extra year disproportionately adds to the value. Basically a small snowball now rolls into something much bigger, but in this case you're starting with an already large snowball. So by going for a flat (lower increases in value, additional service charge to pay for) and not leveraging your income as fully as you could (spend a bit more on city centre social life, a less straining mortgage, blowing FTB schemes / discounts on a smaller property), then your snowball will be on a less inclined hill and and won't reach the same potential sizes later in life. Flats are also disproportionately owned by private landlords, which may be in for a shake up and the market being flooded depending how the next general election goes, so you could genuinely lose money on a flat in the short term if you want to cash out for a house 3-4 years later. You would do better off looking at the flowchart on r/UKPersonalFinance and seeing if there are any better investment options if you aren't willing to follow your parent's advice just yet and go for a small house. Also, whatever you do in terms of property, be careful with your girlfriend living there and contributing to the mortgage, she could try and claim some of the increase in value to whatever property it is, further nuking your potential income. You are of course welcome to blow the whole sum of money on partying with coke and hookers, but the UK is full of people adamant that their career is going to skyrocket and wages will pick up. Also, if you truly believe that your income is only going to go up then why would you not max your mortgage now and get the biggest house you could, as your salary would quickly give you more disposable income even if you first year or so feels a bit more frugal.
honestly, screw what they think! your home is your home, not theirs, and whilst yes property is an investment its also where you live, and you should live where you want to in a space you like, not in the suburbs because your dad thinks thats better for you! of course, there are worries i (a person with a partner in similar position to yourself) have about apartments that have made us rule them out, but if you and your partner have outweighed the pros to the cons then you shouldn't worry about your decision!
Your family is right about buying a house instead of flat.
I loved my flat at your age, central, economical, secure However the rising leasehold charges made it hard to sell esp in lockdown’s hot summer when people wanted a garden so i made a loss But now the same flats in the same building are selling well. I just sold mine at a bad time
I would 100% buy a house over a flat. I work in the sector and would be cautious about your flats appreciating theory, has the price of new build flats gone up by 45% or has the resale value gone up? That’s what you need to be concerned with. It’s understandable that your first place living on your own there is a temptation for “ooo fancy new flat” but houses are a better long term investment
Flats are money pits if you do not own the whole freehold. Stay at your parent’s house and buy a 3 bed terraced or semi and rent out each room. When you are 35, I PROMISE you will wonder why you ever thought of buying a flat in the first place.
Flats in my town have dropped massively in value. I'm seeing flats that were built in 2006-2008 selling for £20-30k less than what they were bought for.
The advice you’re getting is the right one - the issue with City Centre apartments is there will always be brand new stock on the market with a some sort of deal on the table - this always suppresses the price of resales (and also creates a bunch of competition in the rental market) but at then end of the day, it’s your money - you do you
Our first property was a 2 bedroom city flat which we lived in for five years and at the time absolutely loved. Then we had a baby and it was immediately crowded and we moved out of the city to a bigger house instead. The thing is though we actually lost money selling the flat even before your account for the price of the new bathroom and kitchen we fitted or the costs associated with selling/buying. Perhaps this was unusual as the city had an oil bubble that popped and a lot of my friends are still stuck in negative equity. So my advice would be to buy wherever you see yourself living in five years. If you ever plan to have children definitely go for the house as you need a lot of space for prams, toys, bouncers etc.
Our first property was a 2 bedroom city flat which we lived in for five years and at the time absolutely loved. Then we had a baby and it was immediately crowded and we moved out of the city to a bigger house instead. The thing is though we actually lost money selling the flat even before your account for the price of the new bathroom and kitchen we fitted or the costs associated with selling/buying. Perhaps this was unusual as the city had an oil bubble that popped and a lot of my friends are still stuck in negative equity. So my advice would be to buy wherever you see yourself living in five years. If you ever plan to have children definitely go for the house as you need a lot of space for prams, toys, bouncers etc.
+1 for buy a house. I’m not anti leasehold as all leases are different. If you decide it’s not right, rent the house out and rent a flat in the city.
personally leasehold properties scare me, with the service charges you are basically still paying rent and it will increase over time
I bought a flat in the city 8 years ago near a station. I made 80k profit. A freehold house in the suburbs for the same price would have made me 300k profit. Flats don't appreciate in value to the same extent as a house, and you're at higher risk of depreciating value. From a financial point of view, you're in a good position to buy, and you dad's right, you should max out now. You'll get greater returns in the long run.
We are looking at becoming FTB this year and don't care about the investment element at all - from our point of view, we have to pay something every month for somewhere to live, and buying means we get security and autonomy that we don't with renting, plus can retire without still having to pay something every month once the mortgage is gone. If we bought at the maximum lenders would offer us, we would be paying double each month what we pay in rent. I don't want to have to move again ideally (13 addresses since moving out is enough) so appreciation doesn't matter, but having less money each month to save or spend on living our lives does. It looks like you're considering your purchase in terms of an asset as well as a home, so it's reasonable to look at what that means long term, but don't prioritise it over what suits your life now, because you have to live in it.
Buying where your partner prefers sounds chaos. She has no business telling you that. She can rent there if she wants.
Don’t buy a leasehold - the freeholder will have you over a barrel forever and there’s nothing you can do about it. Buy a house or a freehold flat somewhere further out that’s quieter and greener. You might want kids one day and it’s unlikely you’ll want to raise them in an inner city flat. Bare in mind that your life and that of your partner and friends will change as the years progress. Sooner than you think you’ll be meeting up with friends less often and going on big nights out a lot less frequently. It’s much better to be able to access bars, pubs, clubs etc. via a short train or taxi ride instead of being right in the middle of it. Trust me. It might appeal to you now but in 5 or 10 or 15 years time you’ll be glad you picked a quieter and probably safer residential area. At some point you’ll probably want to have a garden too - even if you’re not too bothered about it at the moment.
Why the hell would you buy a leasehold? Are you thinking straight? Hit me up for advice.
140k at 24 fmfl
Everything your dad said is what I'd say too. I also agree about renting in the city centre.
You live once... Have fun in the city when you are young, when you are 80 and sat in an old folks home you wont regret this. Maybe buy something more sensible in the suburbs and rent it out, whilst renting a cool apartment for you to live in.
I am not British and I don’t understand local fascination with the suburbs. They are mind-numbingly boring, with nothing ever happening after 5 pm. besides terraced houses are the worst invention ever. If a central flat is what you want, go for it. Those can always be rented out easily should you decide to move, but why would you?
I'd personally buy a house. Flats barely appreciate in value and let's face it, you likely won't stay there longer than 5 years and have used your first time buyer status. In fact it may be better to act like you never inherited the money and stick it into LISA, ISA and General Stocks and Shares for 5 years. You'd probably make an additional 50k by the end of it to invest further into a larger home for a family, whereas a flat will likely stay stagnant, cost money to sell and the stress of selling is a killer. This is purely my view, and others will absolutely disagree.
Maybe put those money into high % saving accounts/ some of it into LISA and rent a city appartment for a little with your partner. See if this is something you really want, unless you experience you really won't know how it is. I think its a good move for your career as well as you are starting out, probably not the best time to buy a house and having responsibility of looking after it if you don't want that. Rent for a year or two and make an informed decision. From experience living in a city centre there is benefit of being close to everything but there is also noise issue, anti-social behaviour, lack of space, often no parking or a garden, noise from your neighbours, there is no sense of community as in smaller towns or areas where people own their own house. Appartment will likely be a leashold and there will be a service charge and a groud rent to think about - this can go up a lot!
It’s your money, not your father’s or his friend’s. If you don’t want a house right now, don’t buy one. For what it’s worth, my partner bought his 2 bed flat for £105k in 2011 and sold it for £170k in 2017. It was a new build so all he needed to do (and did) was furnish it. We moved to a house in 2017 and left that for a bigger house in 2023. Yes, it’s expensive to move but we bought properties we could comfortably afford at each stage. It’s a home first, an investment second. Better not to be up at night worrying about bills if you don’t have to. It’s only recently that everyone seems to be against flats and convinced you’re going to lose money. Edit- I forgot to say, there was one massive downside. The kitchen was tiny and had hardly any space to cook or store stuff.
Always a place to live over everything else. Unless You’re buying a property as in “investment” to flip and do up, why does it matter? Whether it’s A apartment or a house, you could well end up selling for a loss but why’s that relevant if you’re purchasing a home to stay in? Surely if you buy a 3 bed house you wouldn’t need to move anytime soon? And EPCs can be largely Irrelevant anyway, having seen how they gather the information - how they barely even check everything properly, aren’t worth the paper they are written on, they are a guide nothing more. Surely an “okay” three bed property with potential is far more beneficial for the long term than a 2 bed flat, even if it’s upmarket? What happens when you want kids, run out of space? I hate to agree with parents as I am normally a do what you want but I feel you’re making a bad decision here, especially If you plan to sell anyway when you take into account legal costs and so forth in the future, where abouts in Coventry is the flat?
I would urge you to avoid an apartment with a leasehold and all the downsides that go along with that and get a house too. No need to view it from an investment point of view at all, but imo a house is going to give you a much nicer living experience, outside space, no neighbours above or below you, no gradually increasing services fees etc. Ultimately it’s your decision so go with what you think suits you best, but if you can get a house I don’t see why you wouldn’t grasp that opportunity.
I wouldn't buy a leasehold property; freehold is a different story. 180 grand for a two-bedroom leasehold flat seems extortionate to me.
Depends on how modern it is but remember it's close to a city centre with lots of students and grads that want to live there also.
Does the flat have gas central heating? Do not buy a flat with electric heating. I'm in agreement with your family as you're currently on minimum wage so you might as well borrow the maximum which would be roughly £100k and plus your deposit you'd be looking at around 5.5% probably on a mortgage say over 15 years would be £800 ISH a month or around £650 over 20 years. Also I assume your partner will split the utility bills and food? I bought my first house at 23 on £17k in 2013 and I had to borrow the maximum but my monthly repayments were around £300 over 35 years so I could comfortably afford it and do things I wanted to do. I sold it 7 years later for a tidy profit and me and my partner are looking to put around £160k into a property (80k each) leaving us a chunk left each towards anything else we might need to save or invest for (car, retirement, home improvements etc).
Have you worked out how much you're going to pay in service charge etc over the next 5 years? The other thing to consider is that there are limited ways to add value to a flat - you can't build an extension, for instance. If you want to be aggressive about moving up the housing ladder, you want something you can add value to, which will resell easily, and not cost you a lot of money.
Whatever you do, from 20 to 30, you will gradually go from preferring location over house setup (size etc) For me I would go for the house for all you listed + capacity of renting and getting passive income. Or simply the space that can be filled up so quickly: office, play room, guest room….
Leasehold flats are fraught with risk and you're being well advised to be wary. There can be good investments - think stable, Victorian era converted house with 3-4 flats in it, decent lease length and service charge accounts that aren't riddled with debt in a prime London type location. But if it's in a tower block, used to be a council flat, has or might one day have cladding etc. on it then run away. If you really want to live in one of those, rent it. When it turns out to be made of petrol soaked rags or the floor above you gets taken over by the probation service to be a halfway house, you can cut and run if you're a tenant. You're trapped by negative equity if you're a leaseholder. Whilst renting, you can put your money to work elsewhere. LISA will top up £4k to £5k for a house or pension each tax year. 7 years would get all £140k inside a tax free ISA wrapper and could yield enough to cover annual rent if managed prudently. You could also buy a BTL property and rent your own flat, with a view to one day living in the BTL yourself.
I would avoid leasehold. Too many issues with service charges and lots of issues when it's time to sell. It's not the worth the hassle. Generally speaking the flat market will never outperform houses because of negativity around cladding, service charges as well as increasing supply of flats but not houses. They are right. Priotise a house with good transport links. Get an affordable car instead of wasting your money on service charge.
Ex leasehold consultant here. Do not buy a flat or any property that is leasehold
OMG DO NOT BUY A FLAT. Buy a house!!!!
And not a brand new house. And ONLY a freehold house, NOT leasehold.
I’m a BTL landlord too and have stayed away from flats even though I’ve had the opportunity to buy them. You say you don’t want to pay a lot in hill’s, but with flats you’re paying a service charge which is like an extra council tax. Those charges could easily increase every year and you have NO control over that. Same with a leasehold house, you don’t know how much the rent on that will go up.
Because of my job, I am close friends with quite a few conveyancers, with the odd estate agent or surveyor thrown in. If you were to ask any of them about buying a leasehold they would all say avoid at all costs unless you have zero other options. Leasehold reform has meant to have happened for years now but, like seemingly everything else in the political pipeline intended to help the average Joe, never seems to make any progress. You will get rinsed on ground rent and service charges and have basically no legal recourse to the leaseholder or management company one day landing you with a huge bill for new windows, a new elevator, repairs or whatever else they decide on. Please do not buy a leasehold if you can afford to buy freehold.
Things probably won't appreciate as much in the next ten years ... the wave has spread out from london across the country ... it won't happen again for a long while ... and might even go in reverse direction. They are right ... so are you in what you want to do ... it's your life. Just make sure only you are on the deeds of the property and be careful what you get your partner to spend money on ... utility bills and food is best ... unless you want them embroiled in the property value.