Bigger mortgage or enjoy life

[ChickenWine]

Hi all,

I need some guidance on whether or not to move up the property ladder.
I am 28 years old and earn a salary of 42K per year, 50K with overtime. I am due a pay rise in 2 years then again in 3 years following this. However, I am likely to be promoted before then. In which case, my salary will be 52K per year within the next 5 years without any overtime. I am a public sector professional so have good job security and pension (NHS, I am currently a band 7 for those who know the NHS).
I am single and don’t have children, not against meeting somebody but up until this point in my life, I have never got further than a 6 week fling! So I like to plan for my life as a single person.
I currently own a 1 bed flat which I love but feel like I have outgrown- I want my own garden and a second bedroom for guests/to use as an office. My mortgage is very low- £455 per month with a £110 service charge, overall my household bills (not including car and food) are £1030 per month.
On my salary and with my low outgoings, I currently have a good quality of life with disposable income, have overpaid the mortgage and am able to go on lots of holidays/big trips to long haul destinations.
However, a house which I love has come on the market in a nearby village- this would be a steep mortgage increase of 1.1k per month just for the mortgage.
It is a beautiful village, the cottage has 2 bedrooms and a large garden. My overall bills would increase by a lot as the council tax etc would be more. I would be left with just £200 a month after bills, food and my car. I appreciate some people are on the breadline and would bite their arm off for a spare £200 a month but this is not a race to the bottom and I want to enjoy my life!
With the potential for promotion, is it worth buying the house now, having a tight few years with less holidays/beauty spending and owning the property? I worry property prices will rise faster than my salary and then I will be priced out of owning a rural cottage in my area!
Or should I just enjoy the disposable income, save more and then reassess in a few years? My fixed mortgage ends in 2027, it’s a 1% fee so would be around 1K as an exit fee

It sounds like it would be very tight. Eg if you found you needed work done on the cottage you couldn’t really afford it.

That’s too expensive and I wouldn’t do it. I would look to move up the ladder, but not if it only leaves you £200 spare a month.

£200 per month spare is nothing, it’s far too tight.

I would buy the house, as you say no reason it would necessarily be easier in a few years time if prices go up. If it's a large garden forget holidays for a while and spend time making the garden a place you want to spend lots of time. You may also find you have plenty to do decorating and making the place your own for a couple of years.

At your stage of life I’d take the jump and move up the property ladder personally.

Could you get a lodger, even if it was just for a couple of years?

I would take the leap if I were you, as you know it would only be tight for a limited time. Can't you port your existing mortgage at your current rate with no exit fee and then get an additional mortgage on top?

Would it not be possible for you to move up the ladder, gain one bedroom but without the £600 or so jump in mortgage?

I absolutely get the desire to improve your housing situation but it also sounds like you have a lovely life right now and leaving yourself with £200 spare would be very tight.

I’d either consider moving but without such a steep rise in cost, or continue to overpay your mortgage, which will increase your equity when you sell in a couple of years, and enjoy some travel for now.

Could you consider buying it then having a lodger in the short term to make it more affordable. It does sound very tight otherwise?

I hadn’t realised that as an 8a you don’t get enhanced hours for overtime etc. so one thing to bear in mind is that when you get the promotion you may not get as much extra as you think due to that.

Im in a similar situation to you and decided to stay put as I enjoy my holidays etc. in due course once I have more equity and savings I could make the move. Could you try living on the money you would have and see what it feels like?

£200 quid is nothing, you’d really struggle. I spend £200 on dinner and then that’s it, gone! One night out a month. How would you pay for upkeep?

I would wait until your pay rise and look for somewhere with a mortgage of around £750 and keep overpaying the mortgage now so you have more equity which will help when buying another home.

I would buy the house if you have options to increase your income if necessary eg working overtime / agency.

It shouldn't be this way but it's property not income that gives people security and a comfortable retirement. And you're right that property prices are likely to be rising faster than you can save on a single income - so your window of opportunity may be closing.

If possible I would consider taking a lodger in the short term so that you can build up some savings. If you are in a nice location and the house is nice you could also let it on AirBnB whilst you are away on holiday for a small amount of extra income.

Short term pain for long term gain. Do make sure you are insured properly for critical illness etc (though NHS sick pay is good).

That is quite a huge jump on your mortgage and you would be screwed if mortgage rates went up again.

I would move, but into something in between your property and this one, so that it is not such a big jump and you have more money per month.

You could save money each month towards a bigger deposit for your next property, so you are saving towards a bigger house, but still have the money available to you if you need it for anything for the house/life emergency.