The second rung - how did you manage it?

[cantthinkofaname]

We are thinking of selling our large 1 bed flat for something bigger. Naturally this won?t be in East Dulwich anymore as it?s eaten itself but we?d like to stay south of the river as our jobs are here. I?m interested to know how on earth others got on the second rung of the ladder. I fear it?s going to be harder than being a first time buyer even though we have decent equity.

Side note, although we could move to a 2 bed flat, it seems like a bad use of funds: big stamp duty fee, gain an extra small bedroom but not much more overall square footage. So, like everyone else, we?re trying to jump to a pre-war house.

How did you do it?

Did you suddenly come into some money, e.g inheritance?

Did you save like crazy to plug the difference?

Take out a big mortgage and stretch yourself?

Compromise hugely on area and pray it changes?

Wait until you?re much older?

Any real life experiences, good or bad, would be gratefully read.

[Jeremy]

My second "rung" was a three bed maisonette (which needed a lot of hard work to make into a liveable home). The jump to a good size house was just much too far. I wouldn't rule out something similar if I were you.

As for how you manage it? Everyone is different but I guess a combination of appreciation, rising salary, saving, and willingness to take on fixer-uppers.

[Milhouse]

Luck. Partner and I both owned small flats that had risen significantly in value. We were able to sell them and buy a three-bed in East Dulwich that needed serious work. It didn't have central heating, a shower or a kitchen to speak of. Walls were falling down and carpets hadn't been changed since the 70s.

Two years on, we've just about finished major work internally.

[ratty]

Moved to Bromley and bought a doer upper. 4 bed house. ?300k.

[????]

being born in the early 60s did it for me

[Salsaboy]

That is of course the 1860's....

???? Wrote:

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> being born in the early 60s did it for me

[ultraburner]

Good luck played a big part for us too.

First flat was Nunhead side of Peckham rye, we bought it just after the price crash in 09. It was a very tired repo so we got it pretty cheap. Did it up over the next few years.

Sold up last year and bought a 3 bed house in Kenley near Purley. It's another do-er upper, but has cost us about the same as a studio flat in E.D.

[Pickle]

Luck for us too. First house in ED came about after we were gazumped on a much smaller flat. Property market went crazy about the time we were looking to upsize, and the house we ended up buying was a "must sell today". That particular day there was a really important England football match on, and lots of the people booked to look though cancelled their viewings.

[Earl Aelfheah]

We bought a house that needed a lot of work. Over quite a few years we did it up and eventually extended. Initially we did take on a big mortgage, but as our salaries rose and over time it ended up being a worthwhile risk. We did also get some help from my parents without which we would have really struggled. Primarilly though we were lucky to buy at a time when the market wasn't quite as mad. Property prices now are a bad joke.

[whateley1970]

I can't get on the second rung - I need about 300k to upgrade a 1 bed ED flat to a 3 bed ugly modern-ish maisonette. This is beyond what I can mortgage on my salary.

A 2 bed flat with service charge doesn't really seem much of a step up to warrant bigging up the mortgage.

[womanofdulwich]

take on a lodger for the first few years?

[alice]

reconfigure / extend making it a 2 bed?

[whateley1970]

It's a tiny one bedder, can't do anything of interest with it. I'm going to do the Kent commuter shuffle!

[alice]

then rent to buy.

so you can come back.

[cantthinkofaname]

Thank you all for those replies.

We may have to lower our expectations (even though I would give my right arm not to be in a flat anymore).I do appreciate though, that we are one of the lucky few to be even on the ladder at all.

Or take out a bigger mortgage but that feels wrong somehow. The gap is ridiculous. Even run down houses in SE are over half a million.

I don't know how anyone does it now, even with equity, unless they have over 100k capital lying around.

[whateley1970]

I'm self employed so the banks aren't keen to lend, even with the flat on a rent to buy option. It certainly wouldn't be enough to borrow to get a house anywhere South London-ish as the gap is so ridiculous as mentioned above.

[*Bob*]

Simply move to somewhere 'undesirable' and wait 15 years or so.

Then you get to listen to newcomers telling you how lucky you've been.

[ultraburner]

A quick look on rightmove says that one bed flats are worth 3-400k in se22.

You can easily get a house for that if you look further out. Ours cost 260k last year and there are quite a few on around here for not much more than that.

[DaveR]

"Did you save like crazy to plug the difference?

Take out a big mortgage and stretch yourself?

Compromise hugely on area and pray it changes?"

The simple truth is that these days you probably need to do all of the above (and most people always needed to, just not to the same extent as now). There's a link below to three bed houses with gardens in S London with asking price< ?400k (Rightmove's definition of S London is quite expansive)

http://www.rightmove.co.uk/property-for-sale/find.html?locationIdentifier=REGION%5E92051&maxPrice=400000&minBedrooms=3&displayPropertyType=houses&oldDisplayPropertyType=houses&propFeature=Garden&sortType=1&numberOfPropertiesPerPage=10

Looking at the map view is quite revealing about where is affordable (obviously relative)

I'd agree entirely with you about trying to step up to a house if you can stretch to it. And if you're willing to compromise on the 'pre war' you will have more choice.

[ratty]

Best of luck with it. Moving further away is actually much, much nicer IMO.

[Blah Blah]

I think anyone joining the property ladder post 2000 is pretty doomed unless they have the kind of job that is transferable to another part of the country. We bought in 1997, with parental help (on both sides) and were able to get a three bedroomed property, large enough for our family. We couldn't do it now.

Part of problem is the desperation for first time buyers to buy anything, just to get a foothold. Even fix-me-uppers are overpriced now. I think the consensus is to look further out.

Useful calculator from the Guardian here. Shows just how ridiculous the situtaion has become.

http://www.theguardian.com/society/ng-interactive/2015/sep/02/unaffordable-country-where-can-you-afford-to-buy-a-house

[srisky]

Options 1-3 and a little bit of 4 (a small-moderate compromise)

#2 was thanks to our base rate tracker, which allowed as to have very very low mortgage repayments for over 5y

#5 depends on what you mean by "much older"

cantthinkofaname Wrote:

-------------------------------------------------------

> We are thinking of selling our large 1 bed flat

> for something bigger. Naturally this won?t be in

> East Dulwich anymore as it?s eaten itself but we?d

> like to stay south of the river as our jobs are

> here. I?m interested to know how on earth others

> got on the second rung of the ladder. I fear it?s

> going to be harder than being a first time buyer

> even though we have decent equity.

>

> Side note, although we could move to a 2 bed flat,

> it seems like a bad use of funds: big stamp duty

> fee, gain an extra small bedroom but not much more

> overall square footage. So, like everyone else,

> we?re trying to jump to a pre-war house.

>

> How did you do it?

>

> Did you suddenly come into some money, e.g

> inheritance?

> Did you save like crazy to plug the difference?

> Take out a big mortgage and stretch yourself?

> Compromise hugely on area and pray it changes?

> Wait until you?re much older?

>

> Any real life experiences, good or bad, would be

> gratefully read.

[srisky]

Unless you have made a huge profit on your first property, it is very hard to move up the ladder in London, even on an average-good income once stamp duty etc has been factored in. Moving out just a couple of zones makes a big difference to ?/sqft.

[dogcatdog]

many are benefitting from the results of the equity they gained when they purchased their first place in the 90s/ 2000's. Other are starting to inherit as their parents pass on & cash in the equity. Despite what we read in the papers, very few are able to arrange a mortgage on 2 bedder in ED from scratch based only on their income these days.