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fiisch
Posts: 510 Forumite
Hi,
So we are looking seriously at escaping the rat-race and relocating to Lincolnshire, largely in search of better schools, a more relaxed lifestyle and larger family home.
We are currently considering two barn conversions - Plot 1, our dream home, and Plot 2, a similarly very nice property but not quite as grand as Plot 1.
I've run some back of a fag packet calculations (see below) and it looks like the dream home is out of reach, but Plot 2 looks a little more realistic.
Please can you have a look at my numbers and critique?! A lot of it is based on wild assumptions at the moment - are my figures realistic? Have I allowed enough play?
We are looking to this as a long-term move, and a complete fresh start. We would dearly love to make Plot 1 happen, but I'm struggling to find a way. I believe the mortgage would be affordable, but the income multiple doesn't seem to quite work - could there be a way?!
The lion's share of this income is earned via a limited company (I am an IT contractor), therefore the affordability I have been offered by the mortgage brokers I've spoken to varies wildly...
My assumptions consider that the builder (they're new build properties) will consider offers and paying stamp on the basis that the property market seems fairly slow in the area at the moment. For example, Plot 1 was previously on the market for a higher amount, but offers received so far have been >£650,000 (which seems highly optimistic!!).
Edit: Grrrr this was in a pretty Excel table but MSE has removed the formatting.
Sale Price £450,000.00
Current Mortgage£246,000.00
Help To Buy Equity Loan £90,000.00
Estate Agent Fees (1.5%?) £6,750.00
Remaining Equity £107,250.00
Other Expenses
Removal Costs£3,000.00
Zopa Loan Settlement£6,000.00
Car PCP reduced to £200 p/m £3,360.00
Legal Fees £2,500.00
Contingiency £5,000.00
TOTAL£19,860.00
Remaining Equity after Expenses £87,390.00
Plot 1
Price: £729,950
Offer: £720,000 (Including Stamp)
Stamp: £26,000 (Not Included in Calculations)
Deposit: £85,000
Required Mortgage: £635,000
LTV: 88.2%
Remaining: £2,390
Joint Income: £117,500
Income Multiple: 5.4
Plot 2
Price: £550,000
Offer: £540,000 (Including Stamp)
Stamp: £17,000 (Not included in Calculations)
Deposit: £82,000
Required Mortgage: £458,000
LTV: 84.8%
Remaining: £5,390
Income Multiple: 3.9
So we are looking seriously at escaping the rat-race and relocating to Lincolnshire, largely in search of better schools, a more relaxed lifestyle and larger family home.
We are currently considering two barn conversions - Plot 1, our dream home, and Plot 2, a similarly very nice property but not quite as grand as Plot 1.
I've run some back of a fag packet calculations (see below) and it looks like the dream home is out of reach, but Plot 2 looks a little more realistic.
Please can you have a look at my numbers and critique?! A lot of it is based on wild assumptions at the moment - are my figures realistic? Have I allowed enough play?
We are looking to this as a long-term move, and a complete fresh start. We would dearly love to make Plot 1 happen, but I'm struggling to find a way. I believe the mortgage would be affordable, but the income multiple doesn't seem to quite work - could there be a way?!
The lion's share of this income is earned via a limited company (I am an IT contractor), therefore the affordability I have been offered by the mortgage brokers I've spoken to varies wildly...
My assumptions consider that the builder (they're new build properties) will consider offers and paying stamp on the basis that the property market seems fairly slow in the area at the moment. For example, Plot 1 was previously on the market for a higher amount, but offers received so far have been >£650,000 (which seems highly optimistic!!).
Edit: Grrrr this was in a pretty Excel table but MSE has removed the formatting.
Sale Price £450,000.00
Current Mortgage£246,000.00
Help To Buy Equity Loan £90,000.00
Estate Agent Fees (1.5%?) £6,750.00
Remaining Equity £107,250.00
Other Expenses
Removal Costs£3,000.00
Zopa Loan Settlement£6,000.00
Car PCP reduced to £200 p/m £3,360.00
Legal Fees £2,500.00
Contingiency £5,000.00
TOTAL£19,860.00
Remaining Equity after Expenses £87,390.00
Plot 1
Price: £729,950
Offer: £720,000 (Including Stamp)
Stamp: £26,000 (Not Included in Calculations)
Deposit: £85,000
Required Mortgage: £635,000
LTV: 88.2%
Remaining: £2,390
Joint Income: £117,500
Income Multiple: 5.4
Plot 2
Price: £550,000
Offer: £540,000 (Including Stamp)
Stamp: £17,000 (Not included in Calculations)
Deposit: £82,000
Required Mortgage: £458,000
LTV: 84.8%
Remaining: £5,390
Income Multiple: 3.9
0
Comments
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My assumptions consider that the builder (they're new build properties) will consider offers and paying stamp on the basis that the property market seems fairly slow in the area at the moment. For example, Plot 1 was previously on the market for a higher amount, but offers received so far have been >£650,000 (which seems highly optimistic!!).
I would suggest these are pretty big assumptions, which you're best off testing before getting too bogged down in numbers - the impression I get is that developers don't tend to budge too much on price, but will haggle on "extras". However, this is of little use if you can't afford the property in the first place!0 -
Most people escaping the rat race, do so when they have more equity to play with, and move somehere cheaper.
You seem to have not that much equity, are proposing a bigger more expensive property with a bigger mortgage.
When we moved out of the rat race, we cleared our mortgage, bought (actually built) a very much larger property and semi retired only working part time self employed.0
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