Would you rather be mortgage free or bigger house

[Bells3032]

Just a hypothetical for now but it may be due to the sale of a family business that in a few years we could have our mortgage paid off for us.

Our house is a very nice 4 bed semi, with an excellent school near us that we are pretty much guarented entry and can walk within 5 mins too. So it won't be for a few years til I can get our child into the school.

However there are a few things id like in a new home eg different kitchen, seperate playroom and a bigger bedroom as well as a bigger garden as ours is quite small and just a bit more space in general. There's no option to extend. I'd also like detached.

The area with most of the bigger houses is about a 20 min walk or 5 min drive from thr school but also v close to my family who I see a lot.

We have a good joint salary (6 figures between us). We have a one year old and looking to start ttc no 2 soon. Once we've had no 2 I'm likely to want to go part time but we can still afford life at thst salary even with our mortgage.

So would you pay off your mortgage and just enjoy life a bit more eg expensive holidays and days out or would you upgrade your house? Money won't be overally tight but we would need to budget.

We live in London too so a bigger house is likely to increase in value more than a current house.

Any thoughts? What would you do.

Tldr: would uou prefer a mortgage free life in a nice but not your dream house or a nicer house but have to budget?

Is the current mortgage affordable?

Can you use the money you get to move to a bigger house whle keeping the mortgage at the same level if that makes sense?

For example, current house with £300k with £100k mortgage and you are inheriting £100k.

Therefore, could be worth buying £500k hou with £100k mortgage.

Bigger house but no additional debt. No way wold I do it, if it meant taking on more debt.

Worked really hard and paid off mortgage before I was 40. Best thing I've done personally but appreciate your circumstances will be different. Have a think about what your long term goals are xx

It sounds like you feel slightly squeezed for space already, and a2nd child, with both kids growing, will only increase that. Would a move mean that you can't get kids into a good school? That might influence me. You have to do the school run for a lot of years, so think about the inconvenience of that v more space.

I’d say go mortgage free and save your mortgage payment amount each month.

Once you’ve got a significant lump sum in savings start thinking about larger house / extension/ loft conversion etc.

We did smaller house, it’s a 3 bed semi. The road we live on is most definitely a lovely road and you pay a bit of a premium to live on it but location is everything. We were mortgage free in our late thirties, we bought when we were just 30 so have had 20 years mortgage free.

There was a period when the house felt a bit overcrowded but last child will be leaving in a couple of years possibly before, he is doing a degree apprenticeship. The other thing are the bills, it is just so much cheaper.

I have never had to worry about money, I still don’t have to which is good especially currently. Plus I became seriously ill and was retired due to ill health a few years ago. People don’t realise pensions are not just for when you get old.. So all those amazing holidays and days out I did from age 34 to 51, I actually can’t physically do some of those things now.

Bigger and better house for me - it's something I will enjoy every single day and I have been mortgage free before and it doesn't really make much difference to me not paying a mortgage. If I didn't pay a mortgage I would be saving or investing the money instead and a detached house in London is a great investment and appreciates well. You can always downsize in the future.

We are in this position at the moment and we have chosen to go for the bigger house. We don't need to increase the mortgage as the money we are getting will pay for that but we could have paid off the mortgage on our current house. Obviously bills will increase with heating a bigger house etc but we feel it's worth it for the extra space we will have.

We went for bigger house- being detached is amazing, and I find the sense of space in our new house very mentally liberating - a small house made me feel cooped up and like I could never get away from anyone.

We chose mortgage free (also a 4 bed semi). I’d like a bigger garden and larger 3rd bedroom for dd2 but can afford to go on luxurious holidays and still plan to retire early. However, if I’d been a better salary before I turned 40 I probably would have gone for a bigger house and overpaid on the mortgage.

We are staying with the smaller house. You never know what is around the corner. Dh is early 40s and on long term sick leave with no pay.

If the house meets your needs then I’d stay and be mortgage free.

The ‘dream house’ is a nice narrative but in reality it’s just a kind of bollocks, isn’t it?

If you’re warm, have good space and a well maintained house that suits your needs do you really need more?

I also wouldn't swap a 5 min walk to school for a 20 min walk/drive. You do the journey to school twice a day - seeing family less so (usually).

I love being 5 mins walk to school, it's so convenient

Also, I have two kids, 9&4.

I’d anticipated being back to full time work by now. Both children are autistic, one non-verbal, and whilst I earn decent money pt I could’ve been earning twice my fte salary minimum if I could’ve climbed the ladder.

This is exactly how I feel. Claustrophobic.

We are mortgage free and I wouldn’t swap it for anything!!Its so freeing!!

What size is your house though ?

We are in a similar position here we will pay off our mortgage in a couple of years. Our house is ok and big enough, but there are some issues which we can't do anything about.
We are going to save the monthly mortgage payment every month, plus our normal savings, and then reconsider things once my oldest starts secondary school. That's a long way off so by then we should have saved enough by then to move without taking any additional mortgage out.
I figure there's no point moving now when we don't know where DC will be going to school.

We are mortgage free on our 3 bed (one child) and I won’t take on another mortgage, even though I’d like to move area (about 10 mins away)
Weighing it up though, I like the security and would rather go on nice holidays these days!

It depends on life stage. In my 30s and early 40s I wanted more space. In our mid-40s we moved into a bigger house and our target now is paying off the mortgage so we can mortgage free at the point we want to start winding down at work.

Mortgage free.

The 5 minute walk to the school is unbeatable and the convenience will be worth more than a new kitchen or playroom to me. You can jazz up the house or have less toys so you dont need a playroom.

The distance to the school will help your house hold its value. Think how much your money will be worth without a mortgage payment which includes interest. Save for a few years and dream about what will suit your family then.

Not necessarily a bigger house, but I’d love to move more rural, which we’re planning to do when both kids are in secondary school, to act as a sort of anchor to where we search.

I could probably sacrifice that to go mortgage free. We have a lovely house as it is so it wouldn’t be the end of the world not to end up in the perfect forever home.

We chose to stay put and be mortgage free.
So glad we did, as now we're only positively affected by interest rate increases instead of dreading each increase.
We're now able to enjoy spending and saving our income instead of being badly affected by the CoL rises.

Same. Being mortgage free was ok but absolutely worth getting another mortgage to be in a nicer house which we really enjoy every day.

Question is is where you are now big enough with two children.

If the answer is yes then stay and pay down, pay off the mortgage

If the answer is no then move before pregnant with number 2/ paying childcare which will impact affordability for a mortgage

Remember as well that the bigger they are the higher the energy bill - it isn't just the mortgage these days

Assuming from this your aunt is perhaps single/no dependents, moving up the chain to bigger properties makes very little sense. If you don’t need more space, why would you move? That said I do appreciate your point about releasing equity for care, just another thing us single folk are unintentionally penalised by the system for I suppose!