Advise needed to sell or buy to let

ReadySteadyPop

neha9 said:

RAS said:

Paying anything over one third of your income towards housing put an enormous strain on your budget, ideally you want 25%.

I appreciate that £56k+ to live in a nice house makes "renting" your current home very expensive as effectively your mortgage payments are not accruing any equity. 

Can you port your existing mortgage?

Has your husband not only seen his GP but been referred if needed? And is he complying with any recommendation? 

Talk to your potential EA about the timing of your listing, would it be better at New Year? Double check the EA's contract and tie-in period.

And maybe go over to both the DFW forum and the Old Style forum to look at ways to stretch your existing budget until you can reduce the housing costs.

When we first purchased our house in 2022, our monthly mortgage payment was £1,400, which was around 30% of our income at the time. Since remortgaging, the interest rate has increased, and our monthly payment has risen to £1900. This sharp increase has made the mortgage significantly more expensive.

This also affects potential buyers and is the reason they can offer less for the house than you hoped for.

noitsnotme

neha9 said:

martindow said:

Another thought.  Assuming your child gets in to this school, what would happen if you subsequently move out of the catchment area?  I assume a change of address would not require you to take them out of this school.

If that is correct, you could stay put until he starts at the school and then widen your search area for moving to a new house.  Quite possibly there are areas with cheaper housing outside the school catchment that would still be easy to travel to school.

Once our child gets a place at the school, we’ll still have time to look for a house within the catchment area around two miles away from the school, which doesn’t feel too far and would be manageable for travel.

Our main worry is the timing. School places won’t be confirmed until next March, and if anything unexpected happens with our jobs or health before then, it could put us under a big financial strain.

I don’t understand the timing issue?  If you’re not moving out of catchment what difference does the timing make?

Herzlos

If you're already in the catchment area then I'd be inclined to stay put. Have you considered how much you'll save downsizing by the time all the fees are factored in?

BTL is going to add huge risk if the tenant stops paying as if you're struggling with 1 mortgage, 2 will ruin you.

Can you extend the term to lower the payments? Can you cut costs elsewhere?

ReadySteadyPop

Herzlos said:

If you're already in the catchment area then I'd be inclined to stay put. Have you considered how much you'll save downsizing by the time all the fees are factored in?

BTL is going to add huge risk if the tenant stops paying as if you're struggling with 1 mortgage, 2 will ruin you.

Can you extend the term to lower the payments? Can you cut costs elsewhere?

Good advice, don`t go the BTL route.

neha9

noitsnotme said:

neha9 said:

martindow said:

Another thought.  Assuming your child gets in to this school, what would happen if you subsequently move out of the catchment area?  I assume a change of address would not require you to take them out of this school.

If that is correct, you could stay put until he starts at the school and then widen your search area for moving to a new house.  Quite possibly there are areas with cheaper housing outside the school catchment that would still be easy to travel to school.

Once our child gets a place at the school, we’ll still have time to look for a house within the catchment area around two miles away from the school, which doesn’t feel too far and would be manageable for travel.

Our main worry is the timing. School places won’t be confirmed until next March, and if anything unexpected happens with our jobs or health before then, it could put us under a big financial strain.

I don’t understand the timing issue?  If you’re not moving out of catchment what difference does the timing make?

We currently live just 0.2 miles from the school.  In cases where two or more children achieve the same score and merit, priority is given based on distance, with the place offered to the child living closer to the school.

neha9

Herzlos said:

If you're already in the catchment area then I'd be inclined to stay put. Have you considered how much you'll save downsizing by the time all the fees are factored in?

BTL is going to add huge risk if the tenant stops paying as if you're struggling with 1 mortgage, 2 will ruin you.

Can you extend the term to lower the payments? Can you cut costs elsewhere?

Thank you for your advice. can consider to extend the mortage term and lower the payments. 

neha9

Thank you all for your advice. After reviewing the responses and weighing our options, we’ve decided not to go down the but to let route, as it would only add extra stress to our situation.

We’re currently in a 4-bedroom, 3-reception house, and if we do downsize, it would likely be to something like a 3- or 4-bedroom with 2 receptions. Our main aim is to reduce the mortgage burden and be prepared for uncertainity, though we’re also considering whether extending the mortgage term might be of help.

martindow

neha9 said:

Thank you all for your advice. After reviewing the responses and weighing our options, we’ve decided not to go down the but to let route, as it would only add extra stress to our situation.

We’re currently in a 4-bedroom, 3-reception house, and if we do downsize, it would likely be to something like a 3- or 4-bedroom with 2 receptions. Our main aim is to reduce the mortgage burden and be prepared for uncertainity, though we’re also considering whether extending the mortgage term might be of help.

You need to do your sums.  Buying and selling costs eat in to the savings made by buying a smaller house.  It may leave you with a smaller saving than first appears.

sheramber

neha9 said:

Thank you all for your advice. After reviewing the responses and weighing our options, we’ve decided not to go down the but to let route, as it would only add extra stress to our situation.

We’re currently in a 4-bedroom, 3-reception house, and if we do downsize, it would likely be to something like a 3- or 4-bedroom with 2 receptions. Our main aim is to reduce the mortgage burden and be prepared for uncertainity, though we’re also considering whether extending the mortgage term might be of help.

What would the potential  price difference be beteen  the two houses?

If you want to reduce your mortgage payments what equity do you have to put towards  the smaller house to reduce your payment.

Also  consider your selling/buying/ moving  costs?

Do the figures add up?

neha9

sheramber said:

neha9 said:

Thank you all for your advice. After reviewing the responses and weighing our options, we’ve decided not to go down the but to let route, as it would only add extra stress to our situation.

We’re currently in a 4-bedroom, 3-reception house, and if we do downsize, it would likely be to something like a 3- or 4-bedroom with 2 receptions. Our main aim is to reduce the mortgage burden and be prepared for uncertainity, though we’re also considering whether extending the mortgage term might be of help.

What would the potential  price difference be beteen  the two houses?

If you want to reduce your mortgage payments what equity do you have to put towards  the smaller house to reduce your payment.

Also  consider your selling/buying/ moving  costs?

Do the figures add up?

The difference in price would be around £150k.
The equity will be the same amount but the mortage payments would be half of what we are paying now. Moving costs will be around 20k i assume, which we can afford and compensate considering our health.