Upsize the house in middle age ?

E-K

My wife and I have happened upon a house which we like. It is in the same town near Exeter. Our life is perfectly good as it is and had no plans to upsize, but this one has caught our imagination - It means tripling the mortgage. We are both aged 47. Our twins will go to university in 5 years time when (at a push) the present mortgage could be finished on our perfectly adequate - and slightly above average value - house.

Our present mortgage is 1/6 of joint take-home pay and we have no money worries - we could take everything that life throws at us.The new mortgage would take us to 1/3 of joint take-home pay and would probably be carried for 18 years up to retirement. The money situation should still be OK ...so long as things don't change much ! (We estimate a 40% deposit.) The university years will be really tight though.

These calculations are based on 5% interest and flat earnings to factor in some wriggle-room.

Job security is alright but who knows ?

What to do in light of the economy, depleted pensions and our age ?

Thanks in anticipation of your thoughts.

(Apologies to those who have already read this post in another section - published there in error)

bouicca21

Actually I did precisely this. It was a stretch at first but became easier and easier; what wrecked it, just I was about to become mortgage free was divorce, though I suppose I can take some comfort from the fact that a big house with lots of equity means both of us can buy decent smaller places (as long as it sells of course).

rrf494g

Only you know . . .

what the new house would provide. You seem clear on the "costs" of such a move but you don't mention the benefits. Seems, on the face of it, to be big stretch for an unknown improvement. Bigger houses seem to offer more, but what will more mean to you?

good luck

E-K

rrf:

Benefits: The house is larger, more beautiful, has more rooms (still a 3 bed though) and is closer to town. There is the potential to allocate part of the house to make an annexe should we have to take one of the old 'uns in.

Presently it is valued at approximately 80k higher. The mortgage repayments would go towards creating more equity for us. (As well as paying the bank interest !)

hermanmunster_3

Twins going to Uni???????? have you looked at the cost of keeping them there?



... I have!!! and am jolly glad I have paid off the mortgage

BitterAndTwisted

Trebling your mortgage and twins going to Uni? *gulp* For a house that's no bigger than what you have now. When the kids have gone to Uni you won't even need a three-bedder, just a one-bed, so they can't come back and clutter the place up, and expect to live with the 'rents until Doomsday paying diddly squat.

VfM4meplse

hermanmunster wrote: »

Twins going to Uni???????? have you looked at the cost of keeping them there?

You might have to insist they go to Exeter and stay at home to save on costs...they could do a lot worse.

Thrugelmir

E-K wrote: »

These calculations are based on 5% interest

Unlikely for next 18 years,

conradmum

I'm not clear on why you want to do this if your current house meets your needs. Do you see this move as a financial investment, and you're gambling on the idea that house prices will rise, you'll be able to downsize and make a profit? If that's the case, why not invest your surplus income now somewhere with a guaranteed return? Far less troublesome or risky than buying a house.

The two main things that could throw a spanner in the works are redundancy and rising mortgage interest rates. Neither are extremely unlikely. Is it worth the risk?

If you have surplus income now, you should also be saving that to help your children through uni. Either or both of you could lose your jobs. At the very least, it will make life easier for all concerned in 6 years' time.

hcb42

I wouldn't do it, get that mortgage paid off instead!

faerie~spangles

Is the OP a wind up?