How do you make it in England? Housing question

Hello guys,

I have a question about housing. We are moving back to England in a few years. Hubby is english, im american. Here in America it took us 18 years to buy our first home but we have a 3 bed room, 2 ba detached in a nice quiet neighborhood and we struggle but with 1 1/2 incomes we can make it, barley but we do.

We bought the home with 0 money down so we are up to our ears in debt really BUT it is ours for now.

Looking for houses in England in many of the areas we are looking to move in to.. the houses range 220-300 pounds.. and the incomes for hubbys job are like 45-50 pounds to start and they go up.... If you can only loan out 3 times your salary then at most wed only be able to afford 150,000 pound house...To get a home equivelent to ours here he would need to be making 80-90,000.00 pounds per year.

How do you make it? I will be working but not at first. All our friends back home have these beautiful houses but they never left england. they have been there and on their jobs for 25 our so years. Wed be starting over...and I know this will be hard but how do you all pull this off? How do you make ends meet?

Im the budget person in our home, I have spent quite a bit of time on cost of living with PA vs SE of england and im not seeing too much difference, barring the houses.

is it possible to buy a home with 0 money down? hubby has no credit in england anymore, wed have to build that up too...

Thanks so much
kat

you can get 100% or even 105% mortgages in the UK.  Will you be selling your US home before you move?  Can you remit those funds for a downpayment?  (there are tax implications to remitting this money from the US to the UK).

You bring up a really pressing question in the UK- many people CAN'T afford houses here in the UK. 

It ain't easy, that's for sure. You'll find a bunch of other threads around here complaining about house prices.

What will you be doing with your house in the US? If you're selling it, that should give you a nice start. The amount of your down payment makes a big difference on the type of loan you can get and the interest rate. The best advice I have based on our current experience is start saving up some money to use for an initial payment. Even if its only 5% of the total it makes a big difference, and more is better.

There are 100% loans, although with no UK credit they are tough to get. (as I've found out... ) If your husband is English perhaps he could open a bank account or get a UK credit card now and start building up a credit record. (I don't really know about that, just an idea.)

The loan amounts I've been finding up here in Scotland are for 3.75 to 4 times our salary, so that gives you a little more to play with.

I might suggest renting for a bit when you first move over, even if you had the money to buy, just to get used to the housing market, learn the areas, and look for the right deal.

Good luck, its a problem lots of people have.

Yes, Definatley open a UK bank account now. That will help. If you an HSBC near you in the US, open a US account with them first, and then after you have it open you can get the paperwork from them to open a UK account from here. We have gone to a branch in Washington DC and the people there knew exactly how to do it and we even had our debit card from the UK before we received our US ones! It also helps when you transfer money from the US to the UK because once you get to the UK you just write a US check to put into your UK account and you don't have to pay all of the fees because it is all with HSBC.

We are lucky to have a good amount of money to be able to put down on a house once we get to the UK from the sale of our house here in the US, but that isn't always possible depending on your debt level. One thing that you have to remember though is that you are NOT going to be able to afford an equivilent size house in the UK. Houses are all together smaller in the UK. You WILL have to downsize. Most houses don't have basements, you may be lucky to get a cellar. We have a 3 floor 3BR townhouse in the US right now, but we most likely will have to go for a small 2BR terraced house in a cheap part of England. Especially the way the exchange rate is right now, you don't get as much "bang for your buck" so to speak.
 
Good luck though.... I will update once we actually get a house in the UK.

I agree, open a UK bank account.  If he can use an address to get on the electoral roll, all the better.

We are going to sell the house we own here in USA but the house market is very bad right now and its a buyers market so we will be very happy if we can walk away without owing anything on the house. We will need to rent for a while to save a down payment for a house.

We do know that we will end up finding houses in the UK alot smaller than in the US but were not too worried about that, a home is what you make it so as long as were together we will be happy..

Thanks so much for your help... do we need a UK address to open a bank account in the UK now?
I will look into HSBC

Thanks so much
Kat

No, you don't need a UK address to open a UK bank account with HSBC now, you just need to open a US account with them first. If you have a good HSBC branch locally, I would go and talk to them because as I said, the one that my husband went to was very knowledgeable about doing it. It is also very easy to switch your address to the UK once you move and you can still keep your US account after moving and just change the address. As I said, that makes money transfer a lot easier.   

Thanks so much... i will get on that asap...does this help build up credit?

Kat