Smaller home good/bad first step on the ladder?

jake_jones99

I'm in the process of buying a 70 sqm semi home as a first time buyer. I'm aware this is small for a house, however it's cheaper than 100sqm homes or over (of course not proportionally, due to the small home premium). However, for a single occupant and maybe with a future partner (thinking a few years ahead) I think it will be enough. 

My question is, does it make sense to push myself to buy a larger home despite the unnecessary space and higher mortgage only for long term purposes? The council tax and bills will likely be larger too. Would a smaller home generally increase slower in terms of percentage (not absolute cost) than larger ones? What are the opinions of more versed homer owners?

_Penny_Dreadful

jake_jones99 said:

I'm in the process of buying a 70 sqm semi home as a first time buyer. I'm aware this is small for a house, however it's cheaper than 100sqm homes or over (of course not proportionally, due to the small home premium). However, for a single occupant and maybe with a future partner (thinking a few years ahead) I think it will be enough. 

My question is, does it make sense to push myself to buy a larger home despite the unnecessary space and higher mortgage only for long term purposes? The council tax and bills will likely be larger too. Would a smaller home generally increase slower in terms of percentage (not absolute cost) than larger ones? What are the opinions of more versed homer owners?

Can you see yourself living in the smaller property for at least 5 years?

Peter999_2

There is no right answer to this and no-one can really tell you how much the house would go up by.

However, is it just you moving into the house or is it with a partner?     What is going to happen in the next few years, are you planning to need more space?     You'd have to consider that if in a few years you do need more space then you'd have to go through the hassle of finding somewhere else and then move.

Over the years, 99% of my friends who have bought a larger house and pushed themselves have told me they made the right decision and are glad they did spend a few years struggling to have the house they actually wanted.

However, one of my friends pushed herself and then unfortunately she lost her job and had to sell the house and go back to renting for a few years.

If it was me, and I was in a "secure" job (if there is such a thing) then I would spend the extra and get the bigger house.       When I bought a house in 2014, I could have bought a semi or a detached house in the same street and the difference was £100,000.   Now, looking back a couple of years ago, I wish I had bought the detached house instead as they are now about £180,000 more expensive.     Then I split up with my wife and got divorced.   If we had bought the detached house we would have had to sell it to split the proceeds, but having the cheaper semi-detached she could stay in the house and I could buy a different house.

There really is no right answer, either have pitfalls and advantages.

jake_jones99

_Penny_Dreadful said:

jake_jones99 said:

I'm in the process of buying a 70 sqm semi home as a first time buyer. I'm aware this is small for a house, however it's cheaper than 100sqm homes or over (of course not proportionally, due to the small home premium). However, for a single occupant and maybe with a future partner (thinking a few years ahead) I think it will be enough. 

My question is, does it make sense to push myself to buy a larger home despite the unnecessary space and higher mortgage only for long term purposes? The council tax and bills will likely be larger too. Would a smaller home generally increase slower in terms of percentage (not absolute cost) than larger ones? What are the opinions of more versed homer owners?

Can you see yourself living in the smaller property for at least 5 years?

Yes I can. 

Herzlos

Small homes usually sell pretty well though any price growth will be lower. 

However, the running costs are lower too, so you should be able to build up more equity.

So it really comes down to how much you need to stretch your budget and how long before you think you'll need to move again. The safe choice is to buy smaller, pay less (up front and ongoing) and then move later as you need, but if you can afford the bigger place without any real risk, it's likely to pay off better over the longer term. 

I always recommend buying with expansion in mind if you can afford to. 

jake_jones99

Herzlos said:

Small homes usually sell pretty well though any price growth will be lower. 

However, the running costs are lower too, so you should be able to build up more equity.

So it really comes down to how much you need to stretch your budget and how long before you think you'll need to move again. The safe choice is to buy smaller, pay less (up front and ongoing) and then move later as you need, but if you can afford the bigger place without any real risk, it's likely to pay off better over the longer term. 

I always recommend buying with expansion in mind if you can afford to. 

I actually do have that in mind my neighbours built a conservatory or a loft room and this house doesn't have either but looks like it could. Not sure if I'd get all investment back though. 

jake_jones99

Herzlos said:

Small homes usually sell pretty well though any price growth will be lower. 

However, the running costs are lower too, so you should be able to build up more equity.

So it really comes down to how much you need to stretch your budget and how long before you think you'll need to move again. The safe choice is to buy smaller, pay less (up front and ongoing) and then move later as you need, but if you can afford the bigger place without any real risk, it's likely to pay off better over the longer term. 

I always recommend buying with expansion in mind if you can afford to. 

To be fair if I found a house that has all characteristics I want and also slightly larger I would get it. Apart from size, this one has everything. However I am aware than even 70 sqm net space is larger than anything I've ever lived in alone, and I'm not sure if it's worth missing this opportunity for something else that might never come. 

You mean price growth is lower simply because they were cheaper in the first place, not because the relative growth is smaller (in %) right?

jake_jones99

Peter999_2 said:

There is no right answer to this and no-one can really tell you how much the house would go up by.

However, is it just you moving into the house or is it with a partner?     What is going to happen in the next few years, are you planning to need more space?     You'd have to consider that if in a few years you do need more space then you'd have to go through the hassle of finding somewhere else and then move.

Over the years, 99% of my friends who have bought a larger house and pushed themselves have told me they made the right decision and are glad they did spend a few years struggling to have the house the actually wanted.

However, one of my friends pushed herself and then unfortunately she lost her job and had to sell the house and go back to renting for a few years.

If it was me, and I was in a "secure" job (if there is such a thing) then I would spend the extra and get the bigger house.       When I bought a house in 2014, I could have bought a semi or a detached house in the same street and the difference was £100,000.   Now, looking back a couple of years ago, I wish I had bought the detached house instead as they are now about £180,000 more expensive.     Then I split up with my wife and got divorced.   If we had bought the detached house we would have had to sell it to split the proceeds, but having the cheaper semi-detached she could stay in the house and I could buy a different house.

There really is no right answer, either have pitfalls and advantages.

However the detached house would've had a much bigger mortgage/costs and i bet even the semi had some uplift, even though not 80k. Despite all this would it have been worthwhile you think? 

Of course, that assumes you knew before you bought how much they would increase and involves a level of speculation. 

Silvertabby

If I were young and single, I'd be looking at two bed/two bath properties.  That way, I'd be able to take in a lodger if necessary.  

_Penny_Dreadful

jake_jones99 said:

Peter999_2 said:

There is no right answer to this and no-one can really tell you how much the house would go up by.

However, is it just you moving into the house or is it with a partner?     What is going to happen in the next few years, are you planning to need more space?     You'd have to consider that if in a few years you do need more space then you'd have to go through the hassle of finding somewhere else and then move.

Over the years, 99% of my friends who have bought a larger house and pushed themselves have told me they made the right decision and are glad they did spend a few years struggling to have the house the actually wanted.

However, one of my friends pushed herself and then unfortunately she lost her job and had to sell the house and go back to renting for a few years.

If it was me, and I was in a "secure" job (if there is such a thing) then I would spend the extra and get the bigger house.       When I bought a house in 2014, I could have bought a semi or a detached house in the same street and the difference was £100,000.   Now, looking back a couple of years ago, I wish I had bought the detached house instead as they are now about £180,000 more expensive.     Then I split up with my wife and got divorced.   If we had bought the detached house we would have had to sell it to split the proceeds, but having the cheaper semi-detached she could stay in the house and I could buy a different house.

There really is no right answer, either have pitfalls and advantages.

However the detached house would've had a much bigger mortgage/costs and i bet even the semi had some uplift, even though not 80k. Despite all this would it have been worthwhile you think? 

Of course, that assumes you knew before you bought how much they would increase and involves a level of speculation. 

When you can afford detached I'd always choose detached.  The bliss of not having any adjoining walls with your neighbours is worth every penny.

RAS

You refer to house and home. Houses are more desirable than flats and newer one bedroom flats often take a lot of time to regain the new home premium. 

Location, both community and physical. What's the community reputation? And is this a property slotted in an odd corner next to something undesirable?