To consider downsizing with a young family?

[flourishing]

Some basic info to provide some context:

• Married couple with two children
• Both work full time, earning equally
• Children in full time childcare (school/wraparound and nursery)
• Purchased home three years ago for £385k and owe £250k on the mortgage
• Zoopla's estimated value of our home is now around £475k - £520k. I am sceptical about this though

I am finding juggling work and children a bit overwhelming and want to spend more time with my children while they are small. I recognise that I am privileged in that I could probably do this to some extent as things stand but I wonder if I need a more radical lifestyle overhaul. Sell up and find something requiring a smaller mortgage?

My children are my priority but at the moment I don't feel like my life is actually set up to reflect that. I feel a bit confused about the next steps.

Does anyone have any views or experiences they would be happy to share on this topic, please?

How much smaller would you need to go in order to relieve financial pressures? If you’re currently in a 5 bedroom place and downsizing to 3 with room for a small office somewhere could get you mortgage free or close to it, then yeah could be sensible. But if you have are in a 3 bed place and you’d have to move to a 2 bed flat with no garden then you might just swap money pressure with inadequate space pressure.

I’d have a couple of estate agents in to do a proper valuation, and then have an honest look about what you’d need to reduce in order to get a better balance.

Thank you. We have 3 double bedrooms and a box room which is used as a home office because I work from home. I don't think we could go much smaller in terms of the number of rooms (children of different ages/sexes and need for a workspace for me) but we could consider smaller homes overall and cheaper areas. We could afford for one of us to work PT now but given the way everything's going (up!) it feels like that could be risky. I feel like we've really suffered from lifestyle creep and maybe need to go back to the drawing board.

Just be aware that if the children are spending more time at home that means either more spending money on activities or needing space for playing in. Friends with two children manage in a small two bed flat but their children are in childcare all day on weekdays and on Sat/Sunday are out at classes or visiting family. So not much need for play space.

Or it means children learning to play in smaller spaces

I have come out the other side now and no childcare cost from this September. Problem is 3 bed and a box room means you can’t go smaller unless you move areas. You really don’t want a teen in a box room. They get a lot of stuff and the clothes get big and that small wardrobe won’t fit anymore. How many years of wrap around care do you still need? If you are working from home and are flexible enough to be able to do pick up, then it could be from year 3 or 4 you stop needing after school clubs. Many here walk from home alone from year 5. It can be a lot less years than you think with such huge childcare fees.

Maybe you could find a place with a nice sized master but other rooms are smaller 🤷🏻‍♀️ don't know how much of a difference that would make

Maybe from a detached to a terraced?
Less car parking space?
In a cheaper area?

Get someone to come and value your place. You can always shop around and when you might find something good.

I mean people do live with less but you already have a decent sized room for each and you are thinking of downsizing. Don’t make that decision lightly!

With less childcare cost, you might be able to go PT sooner too.

My concern with children at those ages would be catchment areas. You can move somewhere less expensive but that often means schools are less good.

Can you find somewhere in the same catchment area?

We have a 3-bed semi; 2 DC (7 & 4) & both DH & I wfh (him ft & me pt). We don't have any spare rooms for an office; DH works in our bedroom & I work in the living room. It's not great, but it works for now. We want to upsize so DS has a larger room, we have our own offices/areas & we have a bigger kitchen-diner but are holding off for now with such uncertainty of utility costs - we're fixed till Nov 2023.
If your children are still young, & you can manage to not have your own office room you could downsize & make it work. But I expect it'll feel very hard to go from having the space, to not; rather than what we have of just making do.

We downsized our mortgage by almost 100k and upsized our house by moving 200 miles away. It's also enabled me to work less and spend more time with DD whilst she's little, plus we now live in a great place with lots to do and more living/outdoor space. Something to consider although it does have its downsides such as missing family and friends.

I wouldn't.
I mean, if you had to then you would have to, but you have light at the end of the tunnel once your little one is out of FT childcare it makes a huge difference to your budget.
Don't forget, as a pp said, moving somewhere where you have enough bedrooms (including wfh space) that is considerably cheaper, probably means moving areas to less desirable areas, including less desirable schools.
Also, in order to cover moving costs and have a reasonable 'gain' financially, you'd have to really be looking at properties that were considerable "less desirable" than your current home.

I'd look at how I could reduce spending in other ways before thinking about this.

Could you not extend the terms of your mortgage or go interest only for a short period.

We have a 3 bed flat (one double and 2 singles) for 2 adults and 2 children.

Space wise its fine - we don't have loads of stuff.

But we often hear neighbours and that does drive me insane sometimes.