Buying a second house when you live mortgage free

SneaksyWhippet

DoggyMama wrote: »

It makes no sense to sell a house you have paid off, to go and pay someone’s else’s mortgage in a rental, while the value of the £s you have then parked in the bank sit there and go down. No one in their right mind would trade a bricks and mortar asset for a rental. Moreover, I would still be unable to make the adjustments needed to meet my additional needs. Hence the quandary.

Thanks for your answers. I think I need an accountant.

They might not "trade"ownership for rental, but they may well rent short term while waiting for the right property to buy.


Would it really be so awful to sell your house, rent somewhere else short term and just wait for the right property to come up? You'd be an attractive buyer, being chain free.


I don't really see how owning two properties will help your situation, when your problem isn't finding a buyer but finding somewhere to buy.

foxy-stoat

DoggyMama wrote: »

It makes no sense to sell a house you have paid off, to go and pay someone’s else’s mortgage in a rental, while the value of the £s you have then parked in the bank sit there and go down. No one in their right mind would trade a bricks and mortar asset for a rental. Moreover, I would still be unable to make the adjustments needed to meet my additional needs. Hence the quandary.

Thanks for your answers. I think I need an accountant.

Of course it does, if you want to remain mortgage free.

Just get a DIP from a lender that have no early repayment charges, if possible, and buy whatever you like. Of course you can get a bid accepted if you have nothing to sell, no idea where you read that from, how do you think people in renting buy somewhere.

As long as you can get accepted for a mortgage you will in a better position than most.

newsgroup_monkey

DoggyMama wrote: »

It makes no sense to sell a house you have paid off, to go and pay someone’s else’s mortgage in a rental, while the value of the £s you have then parked in the bank sit there and go down. No one in their right mind would trade a bricks and mortar asset for a rental. Moreover, I would still be unable to make the adjustments needed to meet my additional needs. Hence the quandary.

Thanks for your answers. I think I need an accountant.

I disagree. People talk about "paying someone else's mortgage", but it's much more complicated than that, so I'll pick up this as a first point.


I'm remarried with kids from a previous. I ended up with the kids.



For various reasons, we couldn't live where I wanted to, so chose to rent in an area to give my kids the best upbringing I could. To put into context, we were paying around £900 a month for a property worth £360k. When we moved, the best mortgage rate we could get (90%) was around 3.5% or £1650 a month.


So yes, I've put our kids before our long-term financial security.


Anyhow, moving on, it's actually done us a favour.


Because we were renting, we had no chain. We found our ideal home with very little upper chain.
The vendor desperately needed out - we were told they were aiming at 7 weeks end to end, but might slip. As it happened, it did slip.


Because we've been able to be this flexible, we've probably saved around £30k on the price (based on similar properties in the area that are not in as good a state!)


So whilst you might think moving into somewhere rented for 6-12 months is paying someone's mortgage, actually, you put yourself in a position where you can get the place of your dreams and possibly less than the market value. Either way, not being in a chain is definitely a positive.


The other thing we're rather enjoying is that we have the keys to our new place, but don't need to be out of our old one until the end of the month. There's no moving day panic for us :j

G_M

DoggyMama wrote: »

We have sold the same house 3 times, with no difficulty. .

But why do you keep re-buying it after each sale? All those legal fees etc each time......

Thrugelmir

DoggyMama wrote: »

The other two promised faithfully to wait while we found somewhere to buy, fully aware of our circumstances and particular requirements, and then tried to force us out into rental. They exploited what they perceived as our vulnerability and desperation, to push us out of an undervalued home and into rental accommodation.

That's probably rather harsh. People just want to get on with their lives. If you wish to wait before buying your perfect home the minute that the property is marketed. You need to be more flexible in your approach. Rather than blame others for losing patience.