Where to buy?

Help1234

Hello, we recently sold our home in Cheshire and relocated to Lewes in South East (East Sussex). Houses here are substantially more expensive and we can afford a smaller, worse house for nearly 3 times what we bought our last home for. We were very fortunate to renovate our last house spending £10,000 and made £60,000 profit. We are currently renting here and unsure what to do. Our budget is £450,000 with an £80,000 deposit and we can afford some 2-bed terraced Victorian homes, that come up now and again. However, we don't anticipate living down here for more than 3-4 years unless we settle really well. We may in the future move to Nottingham where our families live.

My husband thinks we should carry on renting here (we pay £1000 per month) and buy a house in Nottingham for under our budget and renovate it and flip it/let it. This might then provide us with more money should we settle and buy down here, or give us a bigger deposit when we move to Nottingham. However I think we should buy in Lewes and live in the house and I do think we will make profit when we sell in 3-4 years. My husband can't fathom that these 2-bed terraced houses could go up even further in price and is concerned with stamp duty etc it's not worth it. WWYD?

Mahsroh

Personally, I would purchase in the SE where you live. Yes house prices here (I also live in Sussex) are expensive but £450k is still a reasonable budget.

The problem with buying elsewhere to let it is all the other costs that come with that. Letting agents fees, income tax, CGT when you come to sell etc. Once you calculate all of those costs the cost of Stamp Duty on a £450k residential purchase in the SE may not seem to bad. Plus the risk of empty periods with no paying tenants, or sitting tenants who don't pay their rent etc. 

What's your work situation? Are you need somewhere commutable to London, or do you work in Lewes? Reason I ask is that there are areas along / near the coast which don't have the transport links to London, or somewhere slightly east of Lewes such as Hailsham where you get a bit more for your money than you would in the commuter towns, such as Lewes. 

greensalad

If you didn't want to live in a HCOL area why did you move? Or did you not expect this at all? 

What benefit is there of "flipping" a home? What money do you hope to actually gain? Is it worth the stress? If you live at the other end of the country you won't be able to manage the project easily yourself so I guess you'd be using expensive contractors. Is the profit margin worth it? Will you make enough to actually boost your funds? What's your end goal?

Help1234

We moved because we want to live in Lewes and now my husband has a job in Lewes. We know the costs are more here and that's fine for us - we can afford to buy a 2-bedroom terrace as I said. This is just a temporary living situation for a few years while we enjoy exploring this part of the country. We had done everything we wanted in Cheshire and it was time for a change. As this isn't a permanent move we just aren't sure whether buying here would be better for us than buying elsewhere and flipping while we rent here. My dad lives in Nottingham so could help with renovations as he helped us with our Cheshire renovation. 

The end goal is just to make the most profit and we can't agree on whether we would achieve this buying a small 2-bed house in Lewes (live-in) or a larger house in Nottingham (live out and immediately sell after renovating while simultaneously renting in Lewes). As the issue is whether these small houses here can realistically go up much more in price.

Mahsroh

You should be able to get something bigger than a 2 bed for that budget by the way. I don't know Lewes specifically but I live in a neighbouring town (1hr commute by train to London) and there are multiple 3 bed houses on the market in the £400k to £450k bracket. 

GixerKate

I live about half an hour away from you in a nice area and 450k will get you a nice 3-4 bed house with a garden, maybe look outside of Lewes but within easy commuting?