Not sure what to do. Move asap, not move? Can we afford it?

suinn

I'm posting here because MSE helped me 4 years ago when I really needed employment advice, and the forums were really helpful.

Basically, my partner and I aren't sure whether to move or whether, in this climate, we're being incredibly stupid. We're in a house which we paid £65k for in 2005, outstanding variable-rate mortgage is £50k, house value is circa £80k. Area has a bad reputation, was "revitalised" in the late 1990s.

My partner doesn't work (childcare > wages) so we live off my £23k/year salary, no luxuries but comfortable and no plans for the finances to get worse, our family is complete with just one little one.

Problem is, the area. In the last 6 months, the area has seen a huge surge in petty crime (although, 2 months ago a neighbour was mugged, so not that petty). Our car was vandalised last night, window broken, nothing stolen (nothing of value there anyway).

We're extremely stressed about this and are wondering whether to move out, the lady next door will be not renewing her rental agreement next month because of this issue (her cat was set upon by some local kids apparently, my partner has just bumped into her outside the garden and has just rung me to tell me that was the final straw). I fear this will all get worse. Police say they have funding to put on extra beat officers, but I don't see an easy fix to the way the area has gone downhill.

My house is lovely, nice space, but the area is making us want to move. We're sitting "just level" financially... have about £3k in the bank and £0 on any non-mortgage debts. but literally each month £1.4k comes in and £1.4k goes out.

Problems swimming in my head are:
1) We're so tight with cash (no ability to strip back any further) that we couldn't afford stamp duty, legal fees with moving.
2) Economic climate worries me - would banks even give us a mortgage?
3) It could get WORSE! Maybe the house will be worth only £60k in a year if we delay?
4) Not even sure what value mortgage we could get on my single salary these days, it's all changed from 2005 hasn't it.
5) Any area we move to is going to be as good or bad, since we don't have much extra cash to plug into "gaining" a rung on the property ladder. Of course we'd do research before we moved, but, for example - THIS area was lovely back in 2005 and it's only in the last 6mths - 1yr that things are going downhill.

I'm so stressed about this whole thing, does anyone have any advice? I just don't know whether to sit tight for five years and hope the situation improves, or move out whilst the house is still worth something around here?

snowlady07

Hi Suinn
My area sounds similar to yours. I bought my two bed terrace for £78k in 2004, I've completely modernised it (spending about 5k+) and made a lovely home out of it. It's now on the market but I'll be lucky to get what I paid for 6 years ago due to the area going downhill (burglaries, anti-social behaviour etc), literally in the last 12 months!

It's been on the market since early sept but had no interest at all. Nothing else seems to be selling in the area either. I'm now thinking about renting it out instead.

My advice to you would get some realistic valuations from a few EAs and then see if it's worth selling or not in the current climate. Also, keep an eye on rightmove to see if other properties in the area are going SSTC or just staying on the market like they are around me. It sounds like you have a bit of equity you'll be able to use for the next house if you do manage to sell your house.

Good luck, I know how it feels :O)

blt

It is hard isn't it - my house isn't shifting because (according to the EA) the estate down the road puts people off. Now I figure life's too short to not be happy at home so I'm going to move out and rent. I know this isn't the best advice but my house has literally been sat there for 4 months with no viewings. It was valued at £120,000 and I have it on for £15k less but nothing:(

Henry_P_Chester

Do you really need to move out and buy somewhere else? Why not sell up pocket any profit and rent in a different area while you save up a bigger deposit for your next move?

LilacPixie

You could get some EA's in and see what they say, then go speak to either a mortgage broker or your current lender and see what they would be prepared to lend you and how much would that cost.

MAybe pop over to either the debt free wanabee board or the mortgage free board for ideas on how to trim back your outgoings to get you either able to save or cope with a larger mortgage.

Also don't bank on family being complete, I thought mines was too but mother nature had other plans.Right now I am thankful that we didn't stretch ourselves to the maximum and can handle the expense of a third child and my maternity leave with some small lifestyle changes like no holidays abroad for a few years, the 2011 trip to Disney will have to be 2013 that sort of thing

Chinkle

Getting in a local EA for a valuation and seek some advice, it may well be you will find it difficult to sell if the area is getting a bad reputation for crime. But my advice would be to sell up and rent somewhere safer if you aren't in a position to buy. With a child I think you need that peace of mind.

The market is stagnant at best at the moment, so hopefully it will give you some breathing space to get the fees deposit together to buy something in a nicer area in the not too distant future.