Transcript External Influences Getting on the property ladder

External Influences Getting onto the property ladder
Step 1 – Find your dream property
1. Click on the image above to go to Rightmove.co.uk.
2. Enter the area you’d like to live, then enter the particular details (number of
bedrooms etc)
3. If you want to live abroad, click “Overseas” on the top-right-hand side
Note: by all means take a look at the £20m mansions, but chose one under £1m or
else it is difficult to find a mortgage!
The House
Price
Location
Number of bedrooms
Best features
Insert at least 3 photos below
Step 2 – Arrange a Mortgage
1. Click on the image above to go to a Mortgage Comparison site
2. Enter the price of the property and how much you wish to borrow (assume you
have a 10% deposit and don’t go over £1m!)
3. For “Total mortgage term in years”, select 30
4. Choose between a Fixed or Variable Mortgage
5. Pick the best mortgage, taking note of the additional “set-up fees”
6. Make note of the “total amount payable” at the bottom of each mortgage
The Mortgage
Introductory Interest rate
(if applicable)
Interest rate after
introductory offer
Fixed or Variable? Which
did you choose and why?
Set-up fees
Monthly repayments
Total amount payable
Using this link, what
Monthly Repayment:
would happen to
monthly repayments and Total Amount Payable:
total amount payable if
interest rates were 5%
higher?
Taxes
In addition to the many other costs involved when buying a house, the largest is
usually a tax called Stamp Duty.
Check the table below and work out the Stamp Duty for your property.
House Price
Rate
Amount Payable
What are the advantages and disadvantages
of high and low tax rates?
House prices and wages
1. If we assume that whatever your
mortgage is, you’ll pay the same in bills
and utilities, what will be your total
outgoings per month?
2. To ensure you can pay for all of this,
plus have some disposable income, how
much would you have to earn per year?
Remember to account for income tax!
3. What job will give you this kind of
income?
House Prices Over Time
1. Work out the percentage increase in average house prices from Q1 2000 – Q1 2015
2. Apply this to your house and predict its value for 15 year’s time
3. Work out the percentage decrease from Q3 2007 – Q1 2009
4. Apply this to your house and predict its value for 2 year’s time
House Prices & GDP
1. Give a fully developed reason as to why the
economy is so dependent on house sales.
Question time
• Write down at least 5 questions you have about house buying and
macro-economics
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