flat and small mortgage or house and big mortgage

JeffMason

Hi All,
I'm back on the house hunting trail and wanted to see what people thought of my current confusion...

I'm looking in South East London and have three different ways I could play this;

• The first is a smaller (but workable) house in South Norwood or South Croydon for the top end of my budget and the highest mortgage payements I can afford

• The second is a flat (house split in two type) in Forest Hill, Catford, Hither Green type areas that has more square footage and is still at the top end of my budget. I'm looking at low service charge costs or places or share of freehold where buildings are in good condition so hopefully surprise maintanence will be minimal.

• The third is a flat in South Croydon with more space than the small houses and about the same as the flats but under budget so I can have a much smaller mortgage, but these are blocks of flats and the service charges are higher and concerns over surprise maintenance are on my radar. But the monthly costs of mortgage and service charges will be almost half the other two. 

All seem to have there pros and cons and I think I have to keep persuing all three angles and just go with the property that feels like the place I want to live, as long as it's within budget. The less outgoings option is feeling more sensible at the moment though, I feel less secure in my job (there's no reason to think it's going anywhere but most people I know are more aware at the moment) and there's a general sense of needing to make less money is a good idea.

Thoughts welcome...

davilown

For me, it would always be a house - what's the size difference between the house and the flats?

JeffMason

davilown said:

For me, it would always be a house - what's the size difference between the house and the flats?

I would prefer a house of course, but there aren't many options for that in the areas that work for me.

The houses are around 650 sq ft and the flats around 750 sq ft.

RelievedSheff

I would personally always choose a house over a flat. Flats and apartments have never really had any appeal to me.

We lived in a small house about the same size as you are looking at prior to moving into this current larger house. We found it to be perfectly manageable for the two of us and a small dog but we did have to be tidy and make sure everything was put away because it could start to feel and look cluttered very easily. 

In the end it was the area the house was in that made us move. That is one thing you can not change. We were happy with the house but not the area and as we were moving it just made sense to get a bit bigger house.

AdrianC

It's not just the property type, of course. How do the areas compare for you?

JeffMason

AdrianC said:

It's not just the property type, of course. How do the areas compare for you?

I was just about to say, the second option is the winner for me area wise, but also the most expensive. It also reduces my travel costs, although doesn't change the travel time much at all. 

All the areas are perfectly nice though. I might not do as much locally in South Norwood/Croydon but I can connect to other areas very easily from there and would have more money to go out with the third option. Not that there's much going out at the moment!

MaryNB

I was in the same boat until recently but have decided to put an offer on a small house further out from the centre (about the same size as a flat but on two floors). It's just about within my search area. Going by the standard management fees where I was looking, and reduction in council tax because of where the house is, I'll be saving about £150 a month (fingers crossed my offer is accepted!) which will more than cover the increase in my mortgage. There's also the benefit of some outdoor space and no freeholder and messy leasehold over me, and it'll probably be a much more of a long-term commitment. 

JeffMason

MaryNB said:

I was in the same boat until recently but have decided to put an offer on a small house further out from the centre (about the same size as a flat but on two floors). It's just about within my search area. Going by the standard management fees where I was looking, and reduction in council tax because of where the house is, I'll be saving about £150 a month (fingers crossed my offer is accepted!) which will more than cover the increase in my mortgage. There's also the benefit of some outdoor space and no freeholder and messy leasehold over me, and it'll probably be a much more of a long-term commitment. 

That makes a lot of sense! Frustratingly for me, the savings on management fees (which seem to be 120pm on average) still don't make the houses cheaper than the flats in blocks.

I've just been sent a flat in a small block in a really nice area, but it's even smaller at 609 sq ft. It seems to be a decision on which compromise I'm willing to make. 

RelievedSheff

There is always a compromise somewhere.

JeffMason

I wonder why these flats in blocks are so much better value per square foot? I thought perhaps they weren't and the service charge would make them as expensive or more so, but even with that included, they are still cheaper...

So why am I hestitating? I think it's that the service charge feels like I'm almost giving money away. Almost all I've seen are around £120 pm and that cost just covers general maintenace of shared areas and grounds. If part of it went towards a sinking fund for larger works then it feel a little better, but I'm always surprised to find that this cost is seperate and that any big issues that come up would be shared seperately.

Anyway...  

cattie

Personally I'd be going for the middle option, Hither Green & Forest Hill are quite sought after areas these days with great transport links. I'd imagine easier to sell on in the future too. Not to sure about Catford, but perfectly fine if you're at the Hither Green end.   Have you considered Anerley/Penge? Only there are quite a few flats that are sometimes called half houses in these areas & they can be quite spacious. My first purchase was a property of this type.

You don't say if the 3rd option flat is on a local authority estate, which isn't something I'd consider, but if a wholly private development then I'd give serious considerations to the financial positives. 

I live on the borders of SE London & Kent & my current home, which is a share of freehold 2 bedroom flat, actually has more space than the average 3 bed house, but I know that this is the exception rather than the rule.