House buying WWYD: first time buyers and an ex-rental that needs a lot of work

[SarahAndQuack]

I'm driving myself crazy trying to figure this out, and I know there's no good answer. But help me figure out what's sensible?

TLDR: Should we buy a smaller, cheaper, more reliably 'sound' house, or the house we love, which was rented out for years and badly repaired?

Long version: We're looking to buy a first house. Our income is unstable - DP has a stable job but mine is a series of temp contracts. I'm the higher earner and it's possible I'd get a permanent job much better paid than my temp contracts in the end, but by no means certain. If I did get that permanent job, it is quite possible we'd have to move. We have one DD and would like to try for another.

We currently live in a rented house that's up for sale. It's been rented out for decades and repairs have always been done on the cheap. We have had a structural survey done, and while nothing was classed as an emergency problem, the surveyor said there was some urgent structural work. If all that needed doing was what he said, it would be pricey but not ridiculous for us. However, we're worried problems have been made worse by a bodged repair recently. (It's damp, and it's bad because they keep using modern mortar on an old house, plus the bricks are badly worn and need repointing/replacing).

But we love this house. We know that the problems it has would likely look worse to a casual buyer not prepared to pay for a survey, maybe to a professional too. We could make it lovely - it is large, with outbuildings that could be converted, and an enormous garden. It is in a 'desirable' location. The interior is so bad it would put people off for all sorts of trivial reasons that'd be easy to sort (think woodchip wallpaper, fraying carpets). If we took it on for five years or more, I'm fairly confident we could make it much, much nicer and sell it at a decent price (though of course you never know how markets go). OTOH, if we bought it and had to sell in a year or two, I am worried that the ongoing structural issues would make it worth even less than now? I am used to renting where you expect to lose money for living in a property, so can justify it to myself in that sense, but I am nervous.

For our (obviously unstable) budget we could buy a liveable house, but there would be compromises on size or size of garden, or they'd be in dodgy areas.

What would you do? And what would your considerations be?

Outbuildings and a large garden...

It sounds amazing! I would go for it.

He was a specialist surveyor.

The paint is flaking off the walls - it's an old house, ideally it'd be breathable paint, and suitable for a bit of steam from cooking. I don't know what it was but it's awful.

Bad paint etc. definitely does give you an appearance of damp - you get mildewy stuff on it that won't wipe off. You can really easily see the difference on the wall we re-painted ourselves, which has no cracks in the paint and which looks fine, and the one they'd painted just before we moved in, where there are networks of tiny black lines where it's cracked.

I think the damp is coming in where they've re-pointed with modern mortar, but it's not affecting the portions where there's the older mortar.

@GymSloth

Outbuildings and a large garden...

It sounds amazing! I would go for it.

In some ways it is - it does have potential, though the gardens are all windy-about rather than one big piece. In the summer I think it's amazing. In winter I worry!

Oh, sorry, @connie, I missed what you said about quotes. Do you think builders will do quotes for people renting?

@SarahAndQuack

Oh, sorry, *@connie*, I missed what you said about quotes. Do you think builders will do quotes for people renting?

If you don’t have quotes for the remedial work, how can you know if you can afford to do the work ? At very least you’d need to get reliable estimates. Then add a generous contingency.

YY, this is a real worry. What I've done is to ask as much as I can informally, to look up what people say are ballpark figures, and then to assume it'll cost a lot more.

I don't know if builders will make quotes for us if we don't own the house, is the thing. I admit I haven't really pursued it very hard, but I did try to find out and the first few I approached said they don't do that. If it's the norm that you can sometimes get a quote while renting, that's really helpful to know, as I'll try to look a bit harder.

I wouldn't. Your future is uncertain. Your earnings are uncertain. Whether you will have another child or not is uncertain.

FTB buying a house with noteworthy structural issues is pretty rare - they are usually handled by the experienced or professionals.

Has your landlord offered it directly to you or are they going to put it on the open market? sorry if I've missed this.

How would a builder know if you’re renting, unless you tell them?

Also it’s really standard to get builders in to quote on somewhere you’re buying, pre-sale, so just say that - you’re intending to purchase off your landlord.

Our house had some damp issues that didn’t show up on the survey. As soon as we moved in though it was obvious - but a fresh coat of paint ‘to sell’ and some clever furniture placement concealed it I guess. I was pretty pissed off with the surveyor but actually it wasn’t that hard to fix, if annoying, and it meant we got some stuff done we might have left if we hadn’t had builders in so overall it wasn’t a big deal. If you already live there you know its issues and quirks, which is a plus.

@Chicchicchicchiclana - it'll have to be on the open market, they're not allowed to sell direct to us. I'm not sure you're right about structural issues - there are masses of houses round here where the description itself notes structural work needing doing and I know people who've bought them (not people with any experience doing up a house). I wonder if it varies from area to area?

@NoSquirrels - I suppose they wouldn't! Very useful to know it is normal to ask. Maybe the ones I asked were just wrong-footed by me mentioning it.

it'll have to be on the open market, they're not allowed to sell direct to us

Who won’t let them sell direct to you? Are you not in the UK?

I'm in the UK, yes.

My landlord is the Church Commissioners of the Church of England; they are required by charity laws to demonstrate they get best price in a sale, and usually do so by putting houses on the open market. The agent dealing with the sale has been required by them to put the house on the open market, and can't argue. There has been quite a lot of recent controversy about the C of E and its practices in this context, and it won't have been a casual decision they made.

Have your mortgage providers agreed to lend the amount of money you want on a property with structural issues and dampness ? I’m sure you know they are much more cautious at the moment.

Yes, they have.

Btw, just to be clear - the structural issues aren't what I think would be called 'significant'. We were told there were issues that were urgent, because while at the moment they could be resolved quite easily, they could soon become much more serious. When I did the mortgage in principle I read the man who did it the summary of the surveyor's report, which isn't detailed but is quite clear about this.

I would only buy the rented house if you want to live in it after it's done up. Otherwise it's a lot of work, expense, inconvenience.
Also will anyone lend you money on this house with unstable incomes and structural problems? Either of those could be an issue normally,and now they are mega strict due to covid

Sorry cross post!

@snacksizeraisin - thank you, this is helpful.

Yes, we'd love to live in it once done up - it's just we can't count on it as we might have to move again. In theory, I can see us maybe moving again (in 10 or more years), but if we did it up, we could perfectly possibly live here for the foreseeable future too.

We think the bank will lend us the money. DP's income is stable, and we're mostly banking on that. Strangely, I've heard the opposite from you and a PP - there was an article in the Guardian saying more people than ever have been approved for mortgages recently. Though, perhaps that's because more people are turned away at the mortgage in principle stage?

It does make me really nervous. We've neither of us ever bought a house or thought about it. We don't know how it works.

Definitely buy your current house. It sounds like it will be a great project and you know its issues already. You could buy a 'safer' house that has more wrong with it.

I bought a house that I LOVED, 1800s, quirky and full of character and unique features that had been rented out and not particularly well maintained.

I was low on cash after the purchase and it’s taken me 4 years to sort all the issues, one by one. New windows and doors, fix the root cause of the leaky roof rather than just bodge repairs, rework the garden, sort issues with the boiler and heating, dodgy bathroom stuff.

I’m now on the fun stuff- decorating to my taste, putting up beautiful curtains on the odd shaped windows and I’m more in love with the house than ever. I’m here pretty much 24/7 now I’m wfh and my partner has moved in and living in a beautiful house which I LOVE has been a great source of happiness for me during lockdown.

The only thing I would do differently is have more cash behind me when I did it so I could fix the issues quicker and get on to the making it pretty part. Maybe put down slightly less cash to let you get ahead with these.