Mortgage free, but tempted...

rinkydinkpanther

Not sure if this is the right place for this, but here goes...

We bought our first house nearly 8 years ago. Four years in, we had our lightbulb moment with regard to the mortgage, and we're now essentially mortgage free - we have an offset mortgage and although it isn't technically 100% offset because I've put the money where it is earning more than the interest is costing, if I wanted to clear the mortgage completely tomorrow then I could do.

The thing is, since reaching this point I've become obsessed with estate agents, and keep looking at lovely houses that cost double what our current home would sell for. Not necessarily all that much bigger, but gorgeous period places in country villages rather than our modern box on a suburban estate.

On one hand there is no need at all for us to move. Our house is big enough for the two of us, it's close to work, it's perfectly fine. It isn't and never was the house of my dreams but it's very practical. And it's paid for !

On the other hand, we're only 37, we earn good money, have no debt, and both have jobs that are probably as safe as they can be in the current climate. I'm so tempted to just buy a beautiful house in a lovely village. I reckon I could still pay off the new mortgage (2 x joint income) by the time we're 50.

Perhaps it's just that since we decided to pay the mortgage off, we've been really focussed. Part of me is slightly worried about what to do with our money now we don't have that focus - nice problem I know ! We have ISAs and some shares, but I don't really understand investing.

What do you think ? Has anyone ever been mortgage-free and then decided to sod it and take on another ?

shop-to-drop

Given your circumstances I'd probably go for it and move. Period places generally hold/increase value much better than modern and if you would be fulfilled living in such a beautiful place it will increase your quality of life more than building up a lot of savings. We are in quite a different position than yourselves but I'm pretty sure in your situation I would go for it.

ninky_2

rinkydinkpanther wrote: »

. I'm so tempted to just buy a beautiful house in a lovely village. I reckon I could still pay off the new mortgage (2 x joint income) by the time we're 50.

i know the feeling. we too are aiming to be mortgage free but i get tempted by better properties. however i think the thing that stops me is the thought of where it would end. would the beautiful house in a lovely village suddenly be eclipsed by an even more beautiful house in a more beautiful location? would saddling ourselves with a bigger (=longer) mortgage stop us realising other dreams (e.g. travel overseas or taking a career break).

life is a process and if you want to jam as many different experiences into that as possible then a smaller mortgage may be the way to go. i guess it depends how much of a home body you are and if having the 'perfect home' eclipses any other needs?

dimbo61

doing something similar right now but the bills dont half hurt someone who gets 8 pints of milk from farmfoods for £1.50.
Stamp duty( tax), solictors,surveys,mortgage fees,and if buying a period property the the Money pit that old houses can become plus dont forget the VAT ( tax)
If you want it then build up your savings and get looking just beaware of the costs!

RenovationMan

We have just done virtually the same thing. We overpaid our mortgage until it was quite low and then found our dream home. The overpayments made in the past and the low interest rates we have currently have meant that we were able to buy a house that we would never have dreamed of before we overpaid our last mortgage.

What's even better is that even though we have a worryingly large mortgage at the moment, we have really low interest rates and from our prior experience, we know we can blitz this mortgage too!

rinkydinkpanther

Thanks for your input everyone. I think I'm going to save hard for another year or so, see what happens with house prices. I think they can only come down, although I've been thinking that for a while now and it doesn't seem to have really happened yet. Obviously if prices do come down the "gap" between the house I have and the house I'd like will reduce, meaning less borrowing required.

I can see the risk of "lifestyle inflation" and constantly wanting better, but I really think the kind of house I'm looking at would be our forever house. I also grew up in period properties, and know how much they can cost in ongoing maintenance and higher utility bills, would certainly have to take that into account when working out how quickly we could blitz the next mortgage.

RenovationMan

There are things you can do to reduce the running costs of a period property - insulation being by far the best cost v saving, plus new central heating. It all costs a lot of money up front, but then you do get payback over the years. If this is your forever home, as mine is, then you'll be there long enough to recoup the costs. It is daunting though, we've just moved to a house built in the early 1700s and we're looking at redoing the roof with a breathable membrane and kingspan insulation filling the rafters (the technical term is 'warm roof'), plus a new boiler, cylinder and link to our wood burning stove. All work that will make the house so much more comfortable and energy efficient, but with a shocking initial outlay!

Needhelpsaving

I would move - if it's the house of your dreams go for it!!!!

Bobmcdingleberry

Sell the house and give me the money.

shop-to-drop

If you can find your dream, forever house I would go for it. I wouldn't even wait to see what prices do if it's a price you can afford, at your age and circumstances you won't look back and I bet you will even enjoy the challenge of another mortgage to blitz early.

Pee

I am sure you have considered what life will be like living in the village. I live in the middle of nowhere myself, but every location has it's advantages and disadvantages and will suit different people.

I'd be really reluctant to go from being mortgage free to having a big mortgage, but as you say you are young and if village life was right for you, I have to say i would prefer the period place in the village and feel that was worth making cuts elsewhere for, if need be.