Property Chains and a young family

sunstormrider

Hi all

I promise I'll keep this short but it is a very complicated situation so please bear with me. There's me, the Mrs and the two very small kids. Both me and the Mrs are currently working but my Mrs (a teacher) is so fed up with her job (and her boss who is basically victimising her) that she wants to give up work and look after our kids - at least until they're at school. I'm quite happy with this but:
a) she's the major breadwinner
b) our mortgage is nearly £160k - we live in the south east - so we can't stay put on one income. Nor, as she's just come off maternity leave for which we took a payment holiday, can we take another payment holiday for a while.

We've recently discovered that the £80k (£90k before estate agents, removals, SDLT at the buying end) equity that we have will go a long long way to halving or even "thirding" our current mortgage so for the sake of moving to the area I grew up in - we can save £500-£600 per month. Surely worth a go as I have family back up there and the only family we have down here have said they're ok to follow us.

The problem is I can't work out whether to bridge the gap between selling and buying by renting for about 6 months. This would put us in a far stronger selling position as we would have no onward chain, and of course that would make for a less stressful move - though I do hear tales of moving young children around too much causes problems (neither of mine are at school for another 18 months or so).

Renting is, however, dead money and while it would de-stress the thing and give us more powerful selling and buying positions, I can't help thinking it's not worth it and the money we'd save on top of the disruption we'd avoid by effectively moving twice within 6 months is worth it.

It's all a bit of a Gordian knot, complicated by my wife being a teacher so can only move in July, December or March and needs to give 3 months notice. Though of course if she gives up now, she'll be free to move any time from July onwards.

Any thoughts anyone? Anything I've missed? I haven't even got the job yet but if I get it - we'll need to move fast (no pun intended!) and I don't want to be rushed into anything which involves 4 people moving 250 miles!

Cheers

Cannon_Fodder

The odds of finding a house at the right price (in the right school catchment?), and a job, and selling, all in one go are pretty slim.

Don't quite understand your idea about £80k equity - unless you are moving to somewhere with a half or third less prices. Take any ideas about current values with a pinch of salt. To sell, you may need to be attractively priced.

Plenty of teaching jobs still being advertised - why does she have to look after the kids and halve (or worse) your income? A different job, with a different boss, might be enough to make the daily grind worth it. Especially as the major breadwinner. Transfers within Education are easier than finding a fresh industry or getting re-trained in two years when the kids are at school.

If you have a potential job, it may be better to grab it, then B&B for a couple of weeks while you find a rental, then go on the market and sell quickly, then look to buy when in the new location. If she is adament about quitting, waiting until then would be 1 less hurdle.

poppysarah

See union about her work.

See EA for valuations and quick sale

Fire_Fox

Renting is NOT dead money, if you had purchased in 2007 you would probably be in negative equity by now, by renting you have probably saved yourself tens of thousands of pounds.

Mum_of_3_3

I'd definately rent for 6 months whilst looking around to buy.

I know you said you had grown up in the area where you are looking to move so probably already have an idea of where you want to live, but places change and where you thought was nice when you were young, free and single may not suit you now you have a family.

I think you are doing the right thing, as if you can move and live off of one wage in the new area until your children are at school then that's fab. Also, being a teacher your wife has an excellent career as it's totally portable and as long as she keeps uptodate with changes in education practices then she should be able to get a job in the future I should think.

You also mentined about moving not being good for children, but as they are both at pre-school age I would think this is the best time to move, as they have no real roots where you are. When they get to school and make friends it becomes harder and even harder still when they are teenagers, so doo it now whilst you can!

Good luck with everything

M_o_3

silvercar

Remember that your new mortgage will be based on your sole income if your wife isn't working. Also you will need to get a job in the new area before you can get a mortgage.

Brallaqueen

Could your wife tutor part time, fit it around children and yourself? This way you still have a bit of income coming in from her & in some areas tutor rates are quite high?

PasturesNew

You don't have to rent for a minimum of six months, or for six months specifically. Just let the LA know up front that you're renting between houses and this could be anywhere between 3-4 months and a year.... so could you please have a "3 months in the first instance, then moving onto a periodic tenancy" agreement. This would tie you into just the first three months, after which time you have to give one month's notice, which would give you the flexibility you need to move at any time of the year.

As for the missus ... can't she just look for another job?

franklee

Fire_Fox wrote: »

Renting is NOT dead money, if you had purchased in 2007 you would probably be in negative equity by now, by renting you have probably saved yourself tens of thousands of pounds.

Thank you Fire Fox. Anyone who says renting is dead money just hasn't thought things through properly. Rent is about the same as mortgage interest paid out on a loan plus the interest lost on the deposit. I'm getting about 5% gross on my to-be-deposit savings, the landlord about 4.3% gross rental income against the approximate value of the house. He is losing interest income on his deposit/equity and is paying a mortgage on the rest which has an interest charge. I'm buying flexibility and the chance to pounce when I feel house prices are right for me to buy. The landlord has to pay circa 12% to the letting agent, repairs etc. and may have voids. As far as I can make out the value of the house went up a bit and then down a bit so is about the same as when he purchased. I don't see any dead money on my side of the deal

Eric1

franklee wrote: »

Anyone who says renting is dead money just hasn't thought things through properly. Rent is about the same as mortgage interest paid out on a loan plus the interest lost on the deposit.

Maybe renting was dead money 10 years ago and it's still stuck in everyone's brains. With today's prices, my rent is also about the same as my potential mortgage interest.