House deposit or car?

[easty-5]

I'm having some crazy thoughts at the moment and I know you lot are a level headed bunch, so may be able to give me some good advice. Here is what I put on another forum;

Currently saving towards a house deposit with the missus. About 10-15K to go. Saving a bare minimum of £1000 p/m at the moment. I have a real hankering for a VX/Elise.

So, do I continue to save at a rate of £1000 p/m and take out a bank loan, over say 4 years to buy the car, circa 10-12k + my car (Cliosport 182). Or do I put the extra money I'd spend on repayments towards our house deposit?

I know the sensible answer, but my thinking/justification is that a Good VX/Elise shouldn't depreciate much over the next few years, so when the time comes to finally get a house I can sell the car at not too great a loss if need be. I agreed with SWMBO that I will purchase a new car once we have the house sorted, but owning a house isn't cheap so I'm sure there will always be new things that will take priority over a car once we have moved in.

So should I just be content with my current car and put the extra 2-300 I'd spend on repayments towards our savings or continue to save as we are and actually enjoy a little bit of my hard (some would say its debatable ) earned?

FWIW we are both 23 (well I will be in a few weeks) and live, quite happily, at her parents house and pay minimal rent. We have no debts and will be looking to buy a place in Aberdeen - £160-180K. I

All opinions and advice appreciated

[renmure]

Save the money, get the deposit sorted and get the house.

/ Mr Sensible faction.

[jen]

I agree

[SAJ]

House first, drop as much as you can on the deposit, it will save you thousands over your mortgage term.

[Corranga]

100% house first!

[Ferg]

I also say house. If you had to had to have it, it's easy to over borrow on the mortgage by the amount of a VX, say 7k, but you will pay handsomely in interest over the long run. We desperately needed a car for my wife when we bought our house and added a few grand in for that. It was necessary but the long term cost still smarts a little.

[Sparky]

House.

Make sure it has a garage for a Lotus though.

[Justin]

House

[easty-5]

Ach, you folks are all far too sensible

I know full well that the house should take priority but I just don't seem to be able to shake that feeling of really wanting a car, especially come end of the month when I transfer a large wedge of cash into my savings account whereas I always think I could use a small portion of it and buy said car.

Hey-ho, that's life I guess. This growing up malarkey isn't all it's cracked up to be :

[mikeyb13]

Im with you mate. I still secretly hold it against the wife because she pursuaded me that putting my 8k into our then 30k mortgage was a better idea than buying an e30 M3 evo.

[rossybee]

Another for house - even if for avoiding earache from the missus when she want carpets/curtains/kitchen etc

/voice of experience



You're young, plenty of time

Come to think of it when I was 22 I had an Integrale

[campbell]

If buying the car puts the house timescale back by (car value / £1000) months, then the house should come first.

Picking up on Ferg's point above, if you want to use the mortgage to fund the car, then provided your LTV is strong enough, you can indeed finance the car with the mortgage. But you don't need to suffer 25 years of interest on something that you almost certainly will have for far less time. Instead, just ensure you can overpay on the mortgage (many allow up to 10% over-payment per annum with no penalty), then do the maths to work out how to "pay off" the car part of it in say 3 years.

Hey presto, a car loan at maybe 3-4% (or whatever magic deal you do on your mortgage...start a fresh thread for that one!!) and you will barely notice it.

There's lots more to this than purely financial aspects of course. One angle is the psychology and effect upon future marital concessions. If you show commitment to the missus - and the house - right now, it could make it easier to retain whatever impractical 2-seat sportscar you buy when the inevitable 1st sproglet comes along

But push the issue now, and you could be in for a lifetime of grief about "that bloody car".

Think carefully before deciding...

[mckeann]

9 years ago, when i was buying my 1st house with my girlfriend, we had upto 120k to spend. At that time, we could get a lovely 4 bed detached with garage in a nice street. I was put off over spending by the worry of redundancy and the huge amount of debt, as at that time, i had never even had a credit card or loan to pay back.

We ended up buy a 60k, 3 bed semi, ex council house, still in a nice area, but not a patch on the posh options at 120k. The
decision to buy it wasnt made so i could blow my cash on other things, it was made due to worry of redundancy etc etc
The positives from this has been a bloody good lifestyle. I got to race an elise, go ski trips, go french frolics, go to ascari in a caterham, go to the nurburgring 5 times, etc etc. I now go to spain for 3 days of motorbike trackdays about 5 times a year. I have a fcuk excellent life, and when i compare it to the guys i work with, who spend all there cash on a big house and a kid, i'm glad that me and the missus made the choice we did.

Dont get me wrong, i still wish i had a posh house with a garage, but realistically, i cant afford everything, so you have to choose carefully. We dont want kids, which made our decision easier, and everytime i see a nice house and consider buying it, i remember our financial freedom, and 12 awesome holidays a year, and soon decide i'm happy where i am.

Nobody on this forum can decide whats right for you, just giving a counter argument to the "buy the most expensive house you cant really afford" brigade.

[Justin]

There's lots more to this than purely financial aspects of course. One angle is the psychology and effect upon future marital concessions. If you show commitment to the missus - and the house - right now, it could make it easier to retain whatever impractical 2-seat sportscar you buy when the inevitable 1st sproglet comes along

But push the issue now, and you could be in for a lifetime of grief about "that bloody car".

Think carefully before deciding...

Or... Let her have her way just now and she'll always expect it.. After the house it'll be a new kitchen, then the bathrooms.. Car will be last on her priorities..

Lifetime under the thumb!

Just show her who wears the trousers..

[smitstui]

In almost all cases I would say buy the car because life's too short BUT in your case it has to be the House. Get the deposit saved as quickly as you can, get on the ladder and then that's it done. To me it wouldnt seem right to buy a flashy car when you are staying with the (prospective) in-laws

However I do remember how tight money is when starting out and the never ending list of 'Tat' to buy - curtains etc. Then there is the bills. Point is it may be a while after you get a house that you can afford a car.

You're right about these cars costing relatively little to own due to depreciation and I often buy cars knowing that my money is safe or at least a calculated loss over a period of time. However if you buy one to sell at purchase time you may resent having to sell it.


To keep your appetite whetted why not come down to some of the trackdays and get px rides?
Another compromise would maybe be an experience day.
Like anything else in this world the longer you wait the better it will be when you eventually get it!