Should I buy bigger and better?

HitTheBeach

Hello folks,

I'm after some advice if I may.

I'm closing in on becoming mortgage free. My house is an ex council house worth roughly 85k. (I'm up north so this gets me a two bedroom house with decent sized front and back gardens)
It's not a great house or in a nice area but we have been happy in it for 15 years and have never had any trouble in the area. The mortgage is low and we always have plenty of disposable income every month because the debt is low.

I'm torn about what to do next with my life.

Being mortgage free is an exciting prospect for me. Owning the house outright is something I'm very much looking forward to in the very near future.
BUT
I can afford a much better home in a much nicer location but to do this I would have to take out another mortgage.

I'm unsure if it's worth upgrading my home. Are there any benefits to doing this or is it simply just a bigger debt and a bigger ball and chain?

Any thoughts, advice or general musings are appreciated.

Not sure if I have communicated my dilemma properly so please feel free to ask any questions.

Additional info.
Me and my partner are 35 years old and we have a 13 year old daughter.

rosie383

Good for you getting to this stage. If you are content where you are, then is there a possibility of staying there a wee bit longer until you save up to upgrade? That's what we have done and the time is now right for us to make a move. Perhaps live mortgage free for a wee while and see how it feels. Will you save the extra disposable income? Or enjoy not having to worry as much about bills etc. We are mortgage free now and we are going to upgrade but only without another mortgage as we don't want that debt again.

hcb42

I think it is one only you can decide, as you state the area and the house are not great, then that for me would be reason to move, as those things are more important to me and I dont mind paying a mortgage to satisfy those needs. On the other hand if you are going to stretch yourself to the nth degree and are happy then dont move

Brallaqueen

Are you planning on making any life changes in the near future (more children, taking in granny, working from home etc) that would require a bigger house?

Being mortgage free is a very good position to be in, regardless of the house or the area. being mortgage free and having XXX amount of money in the bank is pretty much king of the hill in my opinion.

You say you've spent 15 happy years in the area and whilst it sounds like it has a 'reputatiion' you don't seem to have had any negative experiences or any 'reason' to move just a vague sort of feeling that you should.

You could stay where you are for now as you have no pressing need to move, and build up a savings pot from being mortgage free.

Then, when things do become pressing and you really *want* to move you a) will have more options because of savings and b) the reputation of the area may have improved.

HitTheBeach

I like the idea of enjoying some mortgage freedom but continuing to save for a year or so and then perhaps buying a new home outright.

Excellent advice. Many thanks.

KnightSmile

Well done for being mortgage free at 35!

HitTheBeach

Thank you. Not quite there yet. Probably March 2015 (I'll still be 35 though)

TBagpuss

I'd be inclined to spend a year or so paying the amount you currently pay in mortgage, into savings, and then decide. You'll have the pleasure of being mortgage free, will build up some savings, and will have time to consider what you really want.

Consider what would improve your quality of life A bigger house, bigger garden? better area? more facilities?
or would it be better holidays, bigger pension? shorter working week?

Loopy28

If it was me, I would buy a nicer property in a good area.

In my opinion, apart from the pleasure of living somewhere nicer and the benefit to your child as well, you have a nice little retirement investment, meaning when you hit that time in your life you can downsize and have a nice lump sum towards your retirement.

But you need to weigh that up against being mortgage free for the next few years and see what is your top priority.

Running_Horse

I faced this same decision a few years ago, and moved up to get the best possible house for my new family. You are at an age where if you don't move soon you probably never will. If you are happy with that, then fine.

It is a trade off between age and potential earning power. That will be different for everyone. Having made what was the right choice for me, I now want to get all borrowings down to the lowest possible amount, to ensure not still being mortgaged close to retirement.

enthusiasticsaver

Well done for almost being mortgage free at your age. If you are happy in the area and the house serves your purpose I would enjoy your debt free status and have some nice holidays etc. Moving costs money both in terms of the step up in property and solicitors, estate agents, stamp duty etc etc so it is probably worth while actually having a reason to move - ie better schooling, nearer to work/family or bigger house, rather than moving just because you think you should. That is just my opinion though as I have never put much stock in moving to "better area" unless the school in my existing area was bad or the neighbours bad or crime rate high.