It's completely impossible. That's what makes it so much fun.

armchairexpert

So there I was, late last year, playing on Facebook with a glass of wine on hand, and moaning about where I live. Where I live was fine until we had children, and then the fact that we live on a steep block, on a main road with no pavement (so going to the local park involves harrassing the children into the car or risking life and limb on a road with blind corners), and with no garden, became a teensy bit irritating.

And then a friend of mine asked, did I want to buy her old family home? In my dream location. Huge block. Far nicer address than I could have dreamed of. Bigger house than we currently own. What's the catch? It's old, it's shabby, it's structurally sound but so unfashionable and so difficult to renovate that most people would buy it just for the land and knock it down and build a gleaming new thing.

Which is why they - my friends parents, who now live by the sea and rent this place out - wanted to sell it to me. They've owned it 45 years, they're emotionally attached to it, they don't want it demolished.

We weren't actually planning to buy. I have two children in daycare, I only work part time, I was planning to wait until the younger one starts school in 2017 and then see where we were. But this house. This location. This price!

So, long story short, for the princely sum of Everything I Can Scrape Up, it's now ours.

Or it will be once I sell this place. Settlement is in April, but I need the motivation now to save as much as I can in the meantime.

Some figures, and please don't faint with shock; these are in Australian dollars.

New house: $600,000
Old house: I am hoping for $390,000
With purchasing and selling costs, this will leave me with a mortgage of $250,000

Currently, that equates to an IO monthly payment of $1250. My budget suggests that we can pay $1500, which takes $250 off the principal a month. Which will mean that it will take me a thousand months to be mortgage free. Which is obviously too long.

So in amongst all the tidying and de cluttering and DIYing to try and maximise the price for this place, I'd better crunch some serious numbers.

exarmydreamer

Good luck with your money saving and future purchase. A daily spending diary might help with the family budget, so every penny is accounted for and savings can be adjusted to make extra overpayments.

Old houses are lovely with their creaky floors and uneven walls, it's called character. The extra space in old houses is priceless with children and a better area is priceless for piece of mind.

It took us 8 yrs to finish decorating our house with 4 children in tow and our house is 115 yrs old and had lots of DIY horrors hidden away but that was part of the fun in making it your own. We tried to work with our house and not try to turn it into a modern house - it is what it is, worts and all. Good Luck.:)

cupcakequeen88

Hi, nice to see another Aussie here and I'll be following with interest. Partner and I are just about to buy our first home, and I'm very new to all of this!

Pearla*Merle

Sounds like a dreamy adventure you're on, armchairexpert! Looking forward to hearing how it goes x

armchairexpert

Thanks all!

We spent the weekend moving things into a storage unit, tidying and generally prettying up the place. The children spent the weekend moving things back into the middle of the loungeroom, chalking all over the recently washed decking and generally turning the place back into its usual cesspit. How does anyone sell a house with preschoolers in tow?

My next door neighbour thinks I can get over $400K for my current place, and she owns a few properties so maybe she knows. I'm starting to fantasise about the extra, which is always dangerous.

armchairexpert

After weeks of back breaking work hefting furniture out of the old house and hefting fresh flowers in, we had one open and got an offer within our price range. After a bit of nifty wrangling by yours truly, we now have a signed contract for $405,000.

So that's $15K over our bottom line. Since the monthly payment isn't much different if we have a $250,000 mortgage or a $235,000, we're thinking we'll keep $5K for minor renovations and put $10,000 straight into the mortgage as an overpay cushion...that way we have the extra credit if we need it, but we're not paying the extra interest.

The mortgage product we use is a straight line of credit. So it's an interest only mortgage, but with the facility to overpay very easily - our entire income goes into it and we only pay interest on the outstanding balance, so as long as our outgoings are always lower than the incomings, the amount of interest paid slowly drops.

Three months until we move in, so I'm going to see how much we can save until then. If the budget says that we can pay a $1500/month mortgage, then we should be able to save another $4500 before we move in. And if we can't, then I know my budget needs looking at again.