Stretching selves to buy a bigger house...why??

Batchy

kriss_boy wrote: »

My girlfriend and I are 25/26 in a 1 bed semi, so we want to upgrade in the next 2 or 3 years for a number of reasons.

The fact that there are properties on the market at a fixed price up to 20% cheaper than they were last year is one heck of an incentive to move sooner rather than later!

But like many other people we are playing a waiting game.

but you do realise your property has come down 20% also, have you saved up a new deposit? as LTV problems will become apparent as your try to move... be prepared!

getmore4less

Stretching to avoid a move/trade up is a good idea short term pain long term gain.

When we got together we went from 2*2bed(which were just fine for one) to a 4 bed detatched with seperate double garage main reason was not have to move again till the down size.

Advantages
spacious living room(3 bed places we looked did not have this and a lot of 4 bed had intergral garages making the down stairs rooms relatively smaller)
seperate dinning/eating area
One bedroom for study/office/computer
2 for guests and extra storage.
Garage big enough to work in

Over time one of the bedrooms is full of "stuff" so we only have one guest room
The garage is full of "stuff"
smallest bedroom is the computer room which is packed.

There is the risk that you just fill the space you have so going too big can be a bad thing.

A declutter will be like moving for us we will get the space back and can have a re-org of the stuff we do want to keep.

I would like our next move to be the last so that will probably mean a move to a bungalow or an apartment so we have no stairs.
But first we need to decide where that will be.

I think this last move is criitcal, doing it well before you need to(health). Having a bigger paid for house can make the move cost nuetral since bungalows tend to be more expensive.

The place we are in is more than big enough but think carefully about what it is you are looking for with your space and try to find somewhere that can fill those needs we got a few things wrong for us with this one.

Another advantage of the extra rooms is you can get lodgers if money is tight.

sunshinetours

The ultimate would be to buy somewhere in your ideal location which can grow with you as your life changes i.e kids. Extending is often cheaper than moving and avoids the upheaval of new area, new schools, new friends etc.

However we are of course all different. We moved to a bigger house 4 years ago as we had started a family and wanted/needed 4 bedrooms and wanted/needed a good sized garden for said kids when they got old enough to run around outside

Did we need it or did we want it? I don't know, it has however meant we still have a long term mortgage (which we can afford OK) rather than a lower overall mortgage if we had gone for a 3 bed semi. Would I change - probably not

LittleMissAspie

We haven't bought yet but I'm not sure whether to stretch ourselves or not. By not stretching we will save a lot of money on interest but will have to buy quite far away from work and probably in a not so nice area. We would want to move in 10 years but would the gap to a nicer house be too big? If we stretch now it will cost far more but inflation is supposed to make the debt relatively smaller so would we actually be better off in 10 years? I'm not so bothered about size, I don't want a big house but want to live in a nice location.

Doozergirl

kriss_boy wrote: »

I was kinda joking! Although if there was room Id buy one.

I want a bigger house as I had so much fun doing houses up. As a family we did two of my parents houses to help them trade up, then two of my brothers.

Then when I finally get my own place and do it up the market crumbles cancelling out all my work.

So my girlfriend and I reckon we basically have to save up another deposit for a second house as its pointless selling ours at +/- 2 or 3K what we paid.

I knew you were joking but it did trigger something because people do seem to think that they need to fit a pool table in - do they realise how many £10,000s they need to spend to get that sapce? It's an expensive pool table when you count the cost of the room it sits in!

Regarding your 'failed' development. You did fine if the house is worth about what you paid for it - you beat the market. If that is the way you want to move up the ladder then don't keep this one - if your plan is to beat the market then you just keep going, there is no point sitting on it and allowing the market to do the work for you because you won't get anywhere fast - especially at the moment. You're increasing your risk, you will be a landlord on a property that probably won't give you a decent enough yield because it wasn't bought as a BTL.

I have two children and I'm sitting in a house which has worked out the same as you in some respects but I took it in part exchange for a much larger house at the peak of the market so it got us all the profit from that house and we've beaten the market to a degree as this one is worth about what we paid. I'm desperately trying not to move on again but we have got to a point now where we really can afford to have a significant development ongoing as well as this house (the mortgage each month costs less than the shoes I bought last week) but if I didn't have kids, I'd just keep going and use all of my capital to keep moving up to get us to the point of being mortgage free on our forever house.

We also bought a development last March which we complete on tomorrow. We really and truly beat the market on that one. So you really can make money in any market but you must look really hard. Most houses that look ripe for development probably aren't a sure thing when it comes to making money, especially when you should be looking for at least a 20% margin before you expect to do any better than break even - just in case what happened happens! If the market doesn't fall then it's a bonus, not a right.

Don't feel like this has failed because it didn't - you've done better than most people. I wouldn't wait for number 2, I would use all your available capital to help you move up quicker. Before any kids arrive!

kriss_boy

Doozergirl wrote: »

Regarding your 'failed' development. You did fine if the house is worth about what you paid for it - you beat the market. If that is the way you want to move up the ladder then don't keep this one - if your plan is to beat the market then you just keep going, there is no point sitting on it and allowing the market to do the work for you because you won't get anywhere fast - especially at the moment. You're increasing your risk, you will be a landlord on a property that probably won't give you a decent enough yield because it wasn't bought as a BTL.

At the peak identical houses to ours were selling for the late 90s. One went for 97K two streets away.

Then in March 2008 when the market went a bit dodgey we managed to put in a cheeky offer on ours of 84K and it was accepted.

Luckily it had new windows and kitchen we've spent a total of 3K on the garden, new bathroom and a complete overhaul of doors, facings, carpets coving etc. (relocated water tanks etc to make more room).

We had it recently valued at 85K to 90K. So it looks as though all of our hardwork has simply served to have us break even.

We have probably saved the best part of 3K in mortgage repayments thanks to the interest rate though!

Overall Im happy with our situation. I reckon we can save up about 10K for summer 2011.

pie81

It depends on what you mean by "stretching".

We're upsizing at the moment and are looking for a house that is larger than, strictly speaking, we need (even once we have kids). However, while this is obviously more expensive than buying a smaller place, it's still affordable for us. So I don't consider it "stretching" in the negative, unaffordable sense of the word.

I would never "stretch" to an unaffordable, risky level, but to me having the extra space is worth paying more if it's affordable and not too risky.

If we bought a smaller space, we would (hopefully!) have spare cash floating around. It's not clear what would be a better use for that money; buying a bigger home is a decent long term tax free investment and also one you get to enjoy (unlike eg shares).

GDB2222

uropachild wrote: »

We are thinking of moving to a bigger house ... We do want 3/4 kids .... It will mean stretching ourselves, but not so much that it's unaffordable. Just that we would have less disposible income than we're used to. It's a bit of a sticking point with my husband and i. I would prefer to stretch and have roomo for the family to grow. The husband would prefer to all squish in this smaller house and still be able to afford nice holidays and things.

I'm with you on this one. You can have wonderful family holidays without jetting to the other side of the world. A bigger home is an asset that will be of benefit to you and your family for many years, whilst the effect of a de luxe holiday will wear off in a few days.

Without wanting to psycho-analyse you and hubby, is it possible that he is less keen on having a large family than you think? It's a very big commitment indeed, and you shouldn't rail-road him - not even push him a little bit. You have one child, and maybe you should listen rather carefully whether he is actually saying that he thinks one is enough.

welshy_2002

Bah, I really should read the topic better before replying!... DELETE

pingu2209

Most people I know who have moved to a bigger house and stretched themselves in doing so, did it because they needed more space/bigger garden etc. Either they had (more) children or got a dog etc.

I don't know many people who move AND stretch themselves unnecessarily.