Is now the time to move?

Ellie78

Hi everyone

I thought I was set on my plans to move in the next six months but now I'm starting to wonder if it's the right thing to do and could do with some advice.

We currently own 50% of a small 3 bed semi. Bought in 2007 by my OH for £65,000 (full value £130,000). I moved in (and transferred onto the mortgage) in 2010.
The house really isn't big enough for us. I work/run my businesses from home, my office is in the small single bedroom, and we both have hobbies that take up space. Add to that an energetic dog and we feel like we're constantly ontop of each other.

Our joint income has increased since 2010 and we've been pre-approved for a max mortgage limit of £345,000 (we definitely don't want to borrow that much though).
Between us we have around £45,000 saved for a deposit.

I'm desperate to move to a house that's more suited to our needs but I don't want to make a costly mistake.
Should we suck it up in this house for a few more years, use our savings to pay off the mortgage we currently have and buy the other half of the house? .... or move while we're in a good position to and make a plan to overpay on the new mortgage? (Found a perfect place listed for £290,000)

We've been lazy with the current mortage and haven't changed it in years. Thanks to this site/forum I'm making big changes to how I deal with my finances. We don't have any other debts apart from the mortgage.
Currently on 4.24% variable rate repayment mortgage with Halifax with £49,000 still owed.

Any help/advice would be greatly appreciated!

Ellie

FloraandFauna

I have no idea what the property market is going to do in the next few years - or ever! But I do wonder why you would want to spend another couple of uncomfortable years just to own the whole of something uncomfortable you don't like, rather than half of it. You could be paying to own something you love. Doesn't have to cost £290k though, does it? Whereabouts are you?

If you can afford the payments - and the overpayments - then quality of life is a valid consideration. Quality as in peace, space, lack of mental clutter or pressure. (I say that as someone who cannot bear the noise and smell of cities anymore, so will pay extra for green rural and travel costs).

Regardless of your choice, change that bloody mortgage! You can get a lot cheaper than that.

Ellie78

Very good point! I guess I'm just worried that my heart is ruling my head and there are other, more sensible places I could be putting that money.

We're in Derbyshire. For various reasons we have to stay in the area we're in now and although there are houses cheaper than £290,000 they're barely larger than where we are now and it wouldn't be worth the moving costs for the tiny increase in space.

Is it worth changing the mortgage if we do end up moving in less than 6 months? Would we be better off waiting until we move?

FloraandFauna

Ellie78 wrote: »

there are other, more sensible places I could be putting that money.

... in order to...? Eventually buy a place you love in 10 years' time? You'll have to pay for the house you love either way, so you may as well live in it while you're paying for it?

We're in Derbyshire. For various reasons we have to stay in the area we're in now and although there are houses cheaper than £290,000 they're barely larger than where we are now and it wouldn't be worth the moving costs for the tiny increase in space.

Fair enough, if that's the market.

Is it worth changing the mortgage if we do end up moving in less than 6 months? Would we be better off waiting until we move?

I honestly don't know - get some quotes for fees for changing and see if you'd still end up saving even over six months. I'm guessing you probably wouldn't over that timescale, but if you end up trying to sell and trying to buy for, say, the next 18 months it may be worth it.

I truly do sympathise with your position - I deeply suspect myself if my decision turns out to be the thing I really wanted to do all along... But heart and head can both say the same thing you know ; )

Ellie78

By more sensible place at the moment I mean pension. Currently 40, self employed, with no pension savings. Cursing younger me right now.

FloraandFauna

Ach, I'm 47 so have 7 more years of cursing behind me. Some pension, but had I taken it seriously and not opted in and out over the cursing years I'd not be wondering how best to pay the mortgage off before I retire.

It's only my preference, based on my specific fears for the future, but if I couldn't afford to pay a higher mortgage AND start a pension going, I'd start the pension instead of the new mortgage. In fact, start it tomorrow, no matter how small. Just get going. If you can also work out how to squeak the budget* to do both, then there's no reason you shouldn't do both!

* sorry, don't know how possible this is, or how frugal you already are. It used to make me laugh when people suggested cutting Sky, or changing phone contracts, or spending less on meals out or takeaways, since I had/did none of those things when I was frantically saving for a house deposit. And now I have my house/mortgage, I do none of those things as I'm frantically saving to pay it off and invest some.

Ellie78

Doing both is potentially possible. We don't want kids and have disposable income. I'll need to do some budgets to see if I could afford to put enough away each month. Looking at SIPPs/ISAs and savings accounts is giving me a whole new headache.

FloraandFauna

Great! Go for it. Doesn't matter if it's not 'enough', as long it's something. It gets you started, and then gets you interested, and then gets easier to find the money from other spending... and will be a lot more fun than living off value beans and nettles when you're 67 and living on £640 a month from your state pension. (you have been paying NICs, haven't you?)

As you already have savings for the deposit, then some of the money freed up from any potential sale could go into pensions, couldn't it?

Ellie78

Actually yes that's a very good point, we have a bigger deposit than we technically "need" so a chunk of my current savings could go into a pension and still pay more than 10% deposit if we move.

Yes I pay NIC in my self assessment tax return every year.