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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To ask what you’d do (buying house situation)

52 replies

Houseconfusion2023 · 23/04/2023 00:05

Details - there are probably more, happy to clarify, don’t want to make it too long or to drip feed!

Live in a fairly LCOL area.

Combined salary £60k, based on one FT and one PT. Potential to raise this to £70k+ within the next year.

Low outgoings currently, bills come to about £1100 per month. Currently live in ex local authority flat, low mortgage etc, hence low outgoings.

Pensions in good order.

Home too small for needs, so need to move.

Ownership status confusing but under advice of lawyers so don’t need advice on this aspect - our parents took out a mortgage for us 10+ years ago, they did not actually financially contribute to this, we have paid this for 10+ years so the equity is ours. This equates to £50k-£75k (upper to lower estimate) - this was because we were very young and we were worried about applying for a mortgage at that stage, no financial issues.

Options:
-stay put til market stabilises (least favourite option)
-move to “doer upper” at bottom end of budget, have large budget for renovations, sell within a few years.
-move to “doer upper” at mid point of budget, renovate slower and to a less high spec, sell within 5 or so years.
-move to ready renovated house at low-mid end of budget, stay put for 5ish years. Lots of compromises.
-stretch ourself to top of budget ready to go home, be paying £££ for 25 years.

WWYD?

OP posts:
NoSquirrels · 23/04/2023 00:09

- our parents took out a mortgage for us 10+ years ago, they did not actually financially contribute to this, we have paid this for 10+ years so the equity is ours. This equates to £50k-£75k

Well, until you can 100% be sure you have £50-75K equity it’s all a moot point. Got to assume that if lawyers are involved your parents don’t feel the same way that it’s your money.

NoSquirrels · 23/04/2023 00:10

Why are all your options (except top budget) only a 5-year stay?

Original poster
Houseconfusion2023 · 23/04/2023 00:13

NoSquirrels · 23/04/2023 00:09

- our parents took out a mortgage for us 10+ years ago, they did not actually financially contribute to this, we have paid this for 10+ years so the equity is ours. This equates to £50k-£75k

Well, until you can 100% be sure you have £50-75K equity it’s all a moot point. Got to assume that if lawyers are involved your parents don’t feel the same way that it’s your money.

No, our parents do agree - what I mean is there is a document with the lawyers from 10 years ago when we bought the house stating the property is actually ours. It’s also in their and our will.

They are not out to trip us up here. They have arranged a valuation of the house for Monday and have contacted the lawyer to find out how to transfer deeds to us officially.

They only did it as our rent was more than our mortgage payments would be.

My parents and I are not getting lawyers on each other 😂 they are on our side!

OP posts:
HeddaGarbled · 23/04/2023 00:14

Is there any reason why you can’t do-up a doer-upper and then actually stay there? Why would you need to move on after 5 years?

Original poster
Houseconfusion2023 · 23/04/2023 00:15

NoSquirrels · 23/04/2023 00:10

Why are all your options (except top budget) only a 5-year stay?

Because without going to top end of our budget, we can’t afford the house we really want. Everything other than top end of budget feels like a compromise.

Our kids are young now but space needs will be increasing in about 5 years, I’d imagine.

One parent is currently PT for childcare but in 5 years they will both be in school so we will have more affordability as second parent will be FT.

OP posts:
Original poster
Houseconfusion2023 · 23/04/2023 00:20

HeddaGarbled · 23/04/2023 00:14

Is there any reason why you can’t do-up a doer-upper and then actually stay there? Why would you need to move on after 5 years?

It’s just availability of homes in our area. It seems there are homes in the 240-270k mark (top end of budget) or homes in the £100-150k mark.

Top end is 4 bed, detached, 2 public rooms.
Cheaper homes are 3 bed semi/terraced homes with 1/2 public rooms.

No amount of renovation will unterrace a house or detach the other half of it.

I guess the fact homes are so cheap here probably has an impact on this though.

OP posts:
NoSquirrels · 23/04/2023 00:22

In that case I’d do either

-move to ready renovated house at low-mid end of budget, stay put for 5ish years. Lots of compromises.
-stretch ourself to top of budget ready to go home, be paying £££ for 25 years.

Why put yourself through the stress and £££ of doing up anywhere you won’t stay? Building work is super expensive right now so ‘adding value’ is hard, and with young kids it’s super stressful.

NoSquirrels · 23/04/2023 00:23

Or the option you haven’t mentioned, stretch yourself for the doer-upper long-term home.

Original poster
Houseconfusion2023 · 23/04/2023 00:26

NoSquirrels · 23/04/2023 00:23

Or the option you haven’t mentioned, stretch yourself for the doer-upper long-term home.

Not an option, sadly - we looked at one of these but stretching ourselves means there would be no money for renovations required. This would have been ideal.

OP posts:
Original poster
Houseconfusion2023 · 23/04/2023 00:29

NoSquirrels · 23/04/2023 00:22

In that case I’d do either

-move to ready renovated house at low-mid end of budget, stay put for 5ish years. Lots of compromises.
-stretch ourself to top of budget ready to go home, be paying £££ for 25 years.

Why put yourself through the stress and £££ of doing up anywhere you won’t stay? Building work is super expensive right now so ‘adding value’ is hard, and with young kids it’s super stressful.

We aren’t adverse to doing up a home - our current home was a project too. With one parent p/t it’s relatively do-able. We did a lot ourselves and are happy to live in a proverbial shithole for a few years if it means our next home can be “the one”

We lived in one room for 6 months. Actually, the chaos years are some of our happiest memories (in hindsight with rose tinted glasses!)

OP posts:
Boomboom22 · 23/04/2023 00:30

We bought end of terrace and extended from 2 bed to small 4, could be 3 larger rooms, and bigger downstairs rooms. It's fab.

Kpo58 · 23/04/2023 00:30

The houses at the top end seem pretty affordable (that would be really cheap down south). I wouldn't buy a cheaper one and do it up as I can't see how you could actually gain money on it as you could easily spend the difference between the cheaper house and the more expensive one just doing it.up and that's before all the fees if you were to move again.

NoSquirrels · 23/04/2023 00:34

It’s more that building costs are so expensive now, compared to even 3-4 years ago, that actually adding value on a doer-upper is really hard. Do your sums carefully.

Imthegingerbreadwoman · 23/04/2023 00:35

I would rather not have the stress of renovation and stretch the mortgage on a house I actually want for 25 years. But that's me personally. Will you have time for renovating a house with you both working and young children?

Imthegingerbreadwoman · 23/04/2023 00:36

Plus it always costs at least 20% more than what you estimate it to cost when renovating. If not more! From a couple of friends experience

Original poster
Houseconfusion2023 · 23/04/2023 00:38

Boomboom22 · 23/04/2023 00:30

We bought end of terrace and extended from 2 bed to small 4, could be 3 larger rooms, and bigger downstairs rooms. It's fab.

I just worry about buying and not getting planning permission. We haven’t seen an end of terrace so far but that’s definitely an ideal scenario.

OP posts:
Gymnopedie · 23/04/2023 00:42

The doer-upper, in any of your scenarios, seems to be the wrong choice. You would never feel settled. And what might have seemed fun in the past would be very different with young children.

Therefore my choices would be to either stay put for five years given that you don't need the space right now, or - my preference - stretch yourself now knowing that it is only for a limited time before it gets easier.

Original poster
Houseconfusion2023 · 23/04/2023 00:44

Kpo58 · 23/04/2023 00:30

The houses at the top end seem pretty affordable (that would be really cheap down south). I wouldn't buy a cheaper one and do it up as I can't see how you could actually gain money on it as you could easily spend the difference between the cheaper house and the more expensive one just doing it.up and that's before all the fees if you were to move again.

… it’s clearly not affordable here though. Well, it is, but our mortgage per month would go from £400 to £1400. We are used to low costs and our lifestyle reflects this. Our lifestyle would have to change.

Average house prices in our town are £170k.

Fees are low because stamp duty isn’t applicable.

There is absolutely no way we would be spending £170k doing up a £100k property, so no, the cheaper house wouldn’t ever work out more.

We would be taking a family friend who would be the one who would project mange the renovations for us with us to a viewing prior to purchase, obviously.

OP posts:
Original poster
Houseconfusion2023 · 23/04/2023 00:47

NoSquirrels · 23/04/2023 00:34

It’s more that building costs are so expensive now, compared to even 3-4 years ago, that actually adding value on a doer-upper is really hard. Do your sums carefully.

Friend who does this sort of work professionally would give us a price for the work prior to purchase. We aren’t talking major renovation - simply removing non load bearing walls, new kitchen, new bathroom, potential rewiring, plastering and decoration. One of the house needs new windows too but it’s very well priced (cheaper than our current home!)

OP posts:
Original poster
Houseconfusion2023 · 23/04/2023 00:54

Imthegingerbreadwoman · 23/04/2023 00:35

I would rather not have the stress of renovation and stretch the mortgage on a house I actually want for 25 years. But that's me personally. Will you have time for renovating a house with you both working and young children?

I think so.

One kid is not particularly young.

We have a lot of family help for childcare.

One parent works part time.

Cheaper home would free up a lot of budget for hiring help. Cheaper homes mortgage would be less than current mortgage.

We would have an extra £1k/month between cheap and expensive homes; to put it in real terms. On the cheap homes; we would use some money from equity to do immediate remedial works, and then we could pay remainder of £1k/month to get things done. So in the short term; outgoing will be similar, but I don’t feel as comfortable tying myself to £1400/month for 25 years (up to age 60!!!) as I do agreeing to £400/month foe 25 years plus £1000/month renovation for x months. If that makes sense.

OP posts:
NoSquirrels · 23/04/2023 00:57

But will you make enough profit on the doer-upper to then move to your ideal house in 5 years? At that point you’ll still need to stretch yourselves…

Original poster
Houseconfusion2023 · 23/04/2023 00:57

Gymnopedie · 23/04/2023 00:42

The doer-upper, in any of your scenarios, seems to be the wrong choice. You would never feel settled. And what might have seemed fun in the past would be very different with young children.

Therefore my choices would be to either stay put for five years given that you don't need the space right now, or - my preference - stretch yourself now knowing that it is only for a limited time before it gets easier.

Should add - we did the renovations with one child while pregnant with other one. During covid.

We haven’t felt settled for 10 years. I’m personally fine with this - I view it as part of the process, I have lived in far worse (nothing traumatic - I lived in mould riddled student digs, plus my parent bought a home where literally everything was condemned and it needed completely shelled) whereas my partner is far more … expecting his home to be a sanctuary I guess.

OP posts:
Original poster
Houseconfusion2023 · 23/04/2023 01:02

NoSquirrels · 23/04/2023 00:57

But will you make enough profit on the doer-upper to then move to your ideal house in 5 years? At that point you’ll still need to stretch yourselves…

It might not be THE dream home in 5 years.

But in 5 years we will have no childcare costs, we will have two full-time incomes, and hopefully house prices will drop.

Im just not sure that going to top end is a good idea when house prices are high and wages are low. I foresee a similar situation to 2006-2010 happening, when everything is getting repossessed and everyone is in negative equity, and house prices drop. And if we go to top of budget, this will almost certainly impact us. And what if we split up then?! Not that I plan to split up; but 50% of long term relationships do; so it would be stupid not to plan for it.

OP posts:
Appleblum · 23/04/2023 01:11

I'd absolutely max out my budget and buy the long term home that's ready to move into. Since it's long term you wouldn't need to renovate it immediately, you could save up first.

Original poster
Houseconfusion2023 · 23/04/2023 01:35

Appleblum · 23/04/2023 01:11

I'd absolutely max out my budget and buy the long term home that's ready to move into. Since it's long term you wouldn't need to renovate it immediately, you could save up first.

The long term home doesn’t need renovated, it’s a new build. Which is part of what attracts my partner, but also deters me.

My main concern with maxing the budget is it is REALLY maxing the budget. As in, idk where we are getting all this furniture from. It’s over a grand a month more for mortgage, PLUS over double the council tax. It’s equivalent of over 3x what we pay now. We aren’t talking about an extra £100/month here.

OP posts:
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