Should I sell my house?

Toto

tesuhoha wrote:

I agree with this reasoning but I would still say think very carefully because once you have made this step you cannot go back. If youve lived in a place a long time it does become home and you do become emotionally attached to it. A house is not always a liability or perhaps if it is one to you then you should not own one. The way I see renting is that you pay thousands and thousands of pounds to pay someone else's mortgage and at the end of it you have nothing to show for it. No worries and freedom perhaps but nothing to show for the money you have paid out.

Who says you can't go back? I doubt very much I will be renting in 30 years time. I will buy again but next time it won't be with some stupidly high IO mortgage. It will be in an area I choose rather than one I am tied to, it will be with a decent deposit I have saved. Renting will enable me to save, to stop paying tons of interest on debts, to stop renting from the bank, which was basically all I was doing (at twice the cost of normal rents). I don't feel I have lost any security, in fact I feel I have secured the future of my business and got in control of my finances. Owning my home was costing me £1500 a month just in mortgage, council tax and insurances, now I rent for much less and can give up a storage unit saving another £260 a month. All of that money can go in my savings, and I get the interest rather than paying it all out to the creditors. It isn't as bleak as you make out, I am struggling to see the benefit in owning right now, but as I said earlier this is a personal choice and not for everyone.

ZTD

tesuhoha wrote:

I agree with this reasoning but I would still say think very carefully

Well of course - I would never enter any transaction involving £000s without thinking carefully about it.

tesuhoha wrote:

because once you have made this step you cannot go back.

Of course you can. You made the transition once - you can make it again. Or are you of the opinion that house prices will go up forever and soon no one will be able to afford a house?

tesuhoha wrote:

If youve lived in a place a long time it does become home and you do become emotionally attached to it.

If you live with someone a long time, you do become emotionally attached to them - but this still doesn't stop divorce/fleeing the nest.

tesuhoha wrote:

A house is not always a liability or perhaps if it is one to you then you should not own one.

A house is sometimes an asset, but always a liability,

• Council tax - the owner is always the final liable party
• Repairs - who else is going to pay for them
• Public liability - falls on the owner

tesuhoha wrote:

The way I see renting is that you pay thousands and thousands of pounds to pay someone else's mortgage and at the end of it you have nothing to show for it.

Apart from these days, rents are lower than mortgages, because the rent market is so competative and BTL'ers are relying on capital appreciation to make up the shortfall.

tesuhoha wrote:

No worries and freedom perhaps but nothing to show for the money you have paid out.

Nothing to possess you mean - you have a house which is magically repaired and inspected for safety to show for your money.

"Nothing to show for your money" is a term you could use with interest payments - except you don't have freedom and you have worries.

But what is it to possess a house anyway? Do you ever really possess a house?

halloweenqueen_2

Good luck with whatever you decide. If you feel you cannot cope, maybe you should step off the housing ladder for a time or move to a cheaper area, £50,000 would be a good deposit on a house in a lot of areas outside of london, but then it may not be as good an area for your husbands business.
What is he thinking of doing?
Keep your chin up!

Bigbubble

Thank you for taking the time to reply - I have noticed that you always seem to be offering comfort to deperate DFWs :beer:

lynzpower wrote:

A few things, maybe youve seen an SOA while youve been mooching about
If you stick your SOA up of incomings & outgoings, then we may be able to show you some cutbacks.

I have done this and I will post it in a new thread. I guess this must mean I have had a lightbulb moment!! Seriously though, I know that I can't ignore my financial difficulties any longer...

You are absolutely right about this not being a good time to start up a business. A later poster, ZTD, puts this very well.

lynzpower wrote:

YOu know that you should be sorting this one out together.

You're absolutely right, of course - and that's a whole separate issue.

I don't know anything about DMPs but will have a look although, as I said, I cannot bear anyone to know I am in this mess and would find it so difficult to talk about it all...so grateful that you can be anon on this site.

Will also have a look at www.houseladder.co.uk[/url] - thanks for your advice -

I feel much less alone thanks to all the replies I received.

Bigbubble

Thank you for taking the time to reply - it has been really helpful to see so many questions that need answering put down in black and white - rather that just swirling around in my head.

tyllwyd wrote:

I think you and your OH have to have a sit down and an honest discusssion about your options. My feeling is that if he wants to start up a business, it is vital to make sure that your finances are in order before he begins, or else your personal debts will drag you both and your business under. At the very least, he needs to find any sort of work to bring some money in to try to help keep things afloat until he is ready to get his business going.
QUOTE]


This is totally sensible advice and I feel a bit guilty as I think I must have implied that OH is totally useless. He isn't at all - I suppose that because I have always managed our finances I have set up that expectation.

OH is confident that he has enough work over the next couple of months to cover what he would have earned - he will also have the time to generate new work - which will hopefully mean we're not much worse off in the short term. Don't know that we will be any better off though...which is what we need to be!

Xbigman

You don't have to sell and rent, you can sell and downsize. You can take your 58k, deduct 5k moving costs and add 4 times your own salary and you could sell and buy another house or more likely flat for £193k. That leaves you debt free living on your income alone with your OH commiting all his finances to the business. If you are of the high earner / high spender mindset you will need to lower your lifestyle to fit the new household income, but 35k is more than enough money to live on. Just dont run up more debts.

If you need to move out of the area you are in now to get under 193k then you might need to consider commuting costs, which can be high.

On the sell up and rent question, its fine if you can rent more cheaply AND get a long term lease. I rented at one time and had 5 addresses in 2 years. That was pants. Also remember that rent rises each year but the base mortgage payment stays the same. Saving 100 a month now is not a good move if your hand goes up over 100 in 4 or 5 years time.
Regards



X

Bigbubble

Thanks ZTD - So nice to come across someone who tells it as it is! I'm fed up with always hearing people using such nice correct psychobabble terms that you don't even know what point they are trying to make half the time! (I'm referring to work not MSE!)

ZTD wrote:

The small hours should be spent on sleep. Remember what happened to Lady Macbeth when she couldn't sleep

Sorry for ignorance - what did happen to her!

Is this "My husband has been planning his own business for years now, has a business plan and funding, and was only waiting for the opportunity to strike."

Or

"My husband is now unemployed and suddenly said "I'm going to start a business" in sort-of the male equivalent of buying a pair of new shoes when you're down"?

In fairness to OH he has been working towards this for quite a while but your points about cash flow etc are very true. I think that I have been feeling so desperate lately that I have not been able to sit down and talk through all these sorts of things with him.

Post an SOA.

- I will start a new thread.

But you'll get back to this despair again unless you both change your ways.

You're right about selling the house appearing a 'quick-fix' option and in a way I hope it is - but I hope/believe I have had a genuine 'lightbulb moment'.

I have never felt in such a self-inflicted black hell-hole of helplessness. The ridiculous thing is that - in my mid forties - 'our ways' have only become problematic over the last four years or so - we only ever had small manageable loans before that. I know that if/when we get out of this mess I will be paranoic about spending beyond my means.

Thanks again - any other 'straight talking' advice/comments welcomed!

Bigbubble

Hi all

Thanks for all your replies – tragic to say this is the only place where I can admit how I am really feeling about my life at the moment and why – but it has felt so reassuring to be honest and not have to worry about being called stupid and irresponsible.

As a new poster I don’t know the etiquette re replying so have just clicked thanks to posts –

Tesuhoha wrote:

If youve lived in a place a long time it does become home and you do become emotionally attached to it.

This for me is key. I have lived in my house for years and years (and long before I met my husband). My older children have now left home and all my memories of them growing up are here. I have spent huge amounts of time and energy making my house a ‘home’ that my family are happy in. Now my circumstances have changed – my older kids have gone and I now have a husband and young child – both of whom I love dearly. I wonder whether my strong attachment to my house is healthy sometimes. It can’t have been easy for OH to move into a house where there is so much family history. It is difficult to let go – and I guess this is what prompted my post in the first place!

Thanks again for all your advice

Bigbubble

Hi X

Thanks for your reply

Xbigman wrote:

You don't have to sell and rent, you can sell and downsize.

I think this is what I was hoping to do - even if not immediately.

An earlier poster - Toto - made some good points about the benefits of renting though.

If you are of the high earner / high spender mindset you will need to lower your lifestyle to fit the new household income, but 35k is more than enough money to live on.

You have hit the nail on the head - I have got to sort this out. I earn a lot more than I have earned in the past, have fewer children to support and financial support from my husband - How on earth have I got into such a mess?

Have done SOA - I will also start a spending diary.

Thanks for your warnings about rent rises but would this not also be a risk re. rises in interest rates for mortgages?

lynzpower

My feeling is that interest rate rises are going to hit those with mortgages first. Impact1-mortgage payments go up immiediately. At least in rented you are tied into a contract and thus the LL cant put the rent up legally.

The key is if you look for an experienced LL, then think about when they got it, they may have bought their property some years ago when the cost was cheaper. So they dont need to be putting rents up, to cope with interest rate rises. thats my theory anyway! Dont know how it will work in practice!