To ask WWYD - property refurbishment and brexit (sorry!)

[Bambamrubblesmum]

This is a definite WWYD. Genuinely interested in hearing all sides.

Apologies in advance it is linked to Brexit.

So we bought a house last year with the intention of doing a major loft conversion to add bedrooms and bathrooms upstairs.

We have a good chunk of equity in the property (£150k).

We have the financing in place to do the upstairs conversion.

If we go ahead monthly outgoings will increase and equity will get swallowed up.

Given the change in political situation and uncertainty with regard to the future who knows what the housing market will do.

Therefore we cannot bet on house prices increasing to make build worth it. Although by making house bigger you'd hope it would be worth more so equity would regained if not increased.

We have a small child and one on the way.

Both working. DH contract runs out next year but he is confident he will get another job. I'm working full time.

My dilemma is:

Do we go for it and do the extension

Or

Do we play it safe and wait 12 months or so to see what happens?

If we wait then we will need to refurb toilet (it's on its last legs) and bath (not in a good state). So we would have to spend some money in the short term.

I'm worried we will fritter away our money if we don't do it now. On the other hand I'm concerned about sleepless nights worrying about jobs and housing market.

Family say don't worry because you will stay there long term but if we lose our jobs we may have to sell and get caught in downward property market.

I'm accutely aware this is a luxury many won't be in a position to worry about, but I'm going round and round in circles not knowing what to do. My nesting instinct is going bananas but my worrying side is saying you won't lose anything by waiting 12 months to see what happens.

Are there any cooler heads who can help me figure this out!

[Gobbolinothewitchscat]

We're having similar thoughts. We're contemplating buying a big house that needs refurbed

DH is in a fairly recession proof job

We know that we could probably get a good deal as a lot of chains have collapsed round here

But, there is a bit of me that wonders if we should wait. DH thinks forge ahead

[Socksey]

Is it a house you plan on living in a long time? In which case does it really matter?
Is it a house 'for just a few years', sell and move on? In which case you might want to look carefully at the financial implications.

[MyKingdomForBrie]

How will 150k equity get swallowed up? Is your financing arrangement to borrow the 150k to spend on the refurb? If so I don't think I would spend that much!

[Donatellalymanmoss]

Depends on how stable you think your jobs will be in a recession I think. It's ok saying go ahead because you're planning to be there long term, but if there is a chance you'll need to move for a new job or if you may need to downsize or get a less well paid job then high mortgage payments or negative equity can be a real bind. Also speaking from experience whilst not negative equity necessarily a problem on a practical level can be quite mentally draining.

There are definitely circumstances in which going ahead is the right thing to do, but you're right to give it proper consideration.

[Margrethe]

Set aside the money you would have been paying in higher mortgage costs for the next 6 months to a year and see how it feels. If you can live without this money for your normal monthly outgoings, then you will feel more confident doing it. Meanwhile, the market direction will be more clear and you may even get a deal on the building works if the market slumps a bit.

[IMurderedStampyLongnose]

I wouldn't do it,be tied to a property and potentially have to worry and be stuck later.Just improve upon what is there now and enjoy being financially stable without worrying about paying back a big loan.

[Bambamrubblesmum]

Thank you for your feedback. I'm reading with great interest.

[firawla]

We had loft conversion and some other refurb planned, and are still going ahead with it regardless of the Brexit. Not 150k worth of refurb though! But it depends how badly you need the refurb. We need the space desperately for baby #4 and don't want to move anyway, if you're not sure or can spare the time - no harm waiting? I'm sure overall the refurb has to add value though, even if prices drop, by doing the work on yours it'll still make it better compared to other houses on the market? So more sellable if you do need to down the line

[whois]

Do you need the additional room the loft extension will give you?

Why would you fritter the money? Put it in a 90 day notice account and you can't touch it.