Should we sell our house and start again

lengy1983

we bought our house with a 100% mortgage back in 2007 pre the credit crunch for 110,000. It has now been valued at around 90-95K so we are clearly in negative equity. we also have a mortgage with Mortgage express (Bradford and Bingley) and are stuck with them because we don't have any equity or many savings. We can afford our payments that is not a problem, but we are increasing the size of our family and are stuck in a 2 bedroom house with no garden. We could wait and see what the market does over time, but we were wondering if anyone else thinks if we should just try and sell up (our balance will probably be down to 92k by the end of the year) and just pay off the mortgage. We would then just move into a larger rented property, continue saving and get a deposit for a proper family home? This to many may seem a backward step, but really need some advice and giudance.

Anyone else in a similar situation?
Anyone got any advice?

cheers,

lengy

opinions4u

If you think house prices will fall further, sell up and rent.

If you think they'll rise, hang on in there and overpay.

holly_hobby

AS O4U says, only you can make the decision, which ulitimately will be based on your knowledge of the local area, how in demand properties such as yours are held, etc, and how much you are willing to take a punt on values remaining steady to increasing.

If you want to crystallise any possible loss (and don't want to take the chance of the bottom falling any further out of the market), then now may be the time to have a few estate agts round for a ballpark marketing figure ...ask their view on the market from their footfall and completed sales over the past 6 mths or so, and then plan your stratergy from there.

Not being iin a chain (for next purchase) will put you in a stronger position than obv A.N Other, who is not a FTB and has a property to dispose of.

Dilemma's.... dilemma's ...!!

Wish you well ..

H x

Thrugelmir

You need to decide whether renting makes sense. Could the money be better spent repaying your mortgage quicker.

A new addition to the family doesn't require much space initially. So could you use this time to better effect by increasing your equity.

newgirly

Hi, sorry if this is too nosey but how big is your family now?, as thats the thing that has the most impact, 4 kids in a 2 bed is not so much fun, but if its 2 then probably ok while they are still little.

Selling and buying again would inccur costs as well, is it possible to extend anywhere?

dimbo61

I would stick it out with your current house and overpay when you can afford to.
If you sell it will mean selling costs and then trying to get a nice rental property which you are happy with and your new Landlord.
A 6 or 12 months AST ( assured tenancy agreement ) at the most and the chance of rent increases every 6/12 months.

cootuk

Do you like where you are now generally, and is there room to extend upwards?
Is there something else niggling that makes you want to move?
At a push families can make do with a sofabed downstairs too - a bit restricitive but not the end of the world.

Eellogofusciouhipoppokunu

Do the sums. How much are you paying for your mortgage and building isurance now and how much will you be paying for in rent on a larger place? I reckon it'd be significantly higher to rent, which would be wated money. If I were in your position I would stay put and pay down the mortgage as much as I can. You've only been in the house for three years so it can't be standing room only already.

tootsieroll_2

We are in a very similar position unfortunately! We are selling up and renting.... Too expensive to extend, the house is far too small for our family and the neighbourhood is going down hill, so we stand to lose much more in coming years. I'm jumping ship and hoping we are doing the right thing!

Yes, rent is wasted money to a degree, but I suppose so is trying to chase away increasing negative equity as I continue to see our house value drop. We need more space now and living in a better area for our children to grow up in is more important to us at the moment than worrying about owning our home.

It does get to me at times thinking we are taking a huge step backwards, but in a couple years we WILL get back on the ladder, but this time totally debt free and with a large deposit.

Good luck no matter what you decide to do x

lengy1983

It's helpful to see other people in the same boat as us. We just feel if we wait around we won't be happy. We understand rent may be pricey but if we save a llarge deposit we could get the house we really wanted.

Eellogofusciouhipoppokunu

lengy1983 wrote: »

It's helpful to see other people in the same boat as us. We just feel if we wait around we won't be happy. We understand rent may be pricey but if we save a llarge deposit we could get the house we really wanted.

I doubt that if you are starting a family that you will have much spare money to put towards that deposit, especially if your outgoings go up because of the rent. Remember that rental goes up with inflation but your morgage debt is fixed. With increasingly stringent lending criteria, you might find it almost impossible to get back onto the housing ladder once you get off it, at least for several years.

You also have the problem that you have no security of tenure and could end up having to move from one rental to the next if the landlord decides to sell up. Not the ideal position to be in if you are raising a family.