To go from a £500/m mortgage to a £2800/m mortgage?

[badatdecisions]

My partner and I have been looking at buying a bigger house for years, but we're so picky about the area and what we want that there's literally been about 3 properties that we've been interested in enough to go and look at.

Recently one has come up that we both love - it's not quite perfect, but it's the closest we'll ever get to what we want in our budget I think, and there's lots to love.

However, I'm very nervous now about such a huge mortgage jump, as we're currently on a low interest rate on a very small house, lived there years, will have fully paid it off in the next 3 years and would be "free" to travel or do whatever we want as we're self-employed and can work from anywhere. We are mid/late 30s, no kids or plans for kids.

We were considering keeping our current house as it's nearly paid off (I know there's stamp duty to think about with 2 properties), as when I was growing up my parents lost our lovely family home and it's made me really paranoid about losing another home by taking on a huge mortgage, so at least we'd have a house we love to go back to if needed?

Mortgage broker says we're eligible for a bigger mortgage than the house we're looking at buying, but to be honest the thought of that much more debt terrifies me. Our business is profitable every month (touch wood), but we have a team of staff and salaries to pay, and that's our priority - plus having enough of a nest egg in the business to cover several months of them and anything else that may come up without needing to worry.

We also love our current house, it's near lots of our friends, it's not overlooked, it's very convenient, we have lots of great memories of our pets there, it's just feeling too small for us really, plus the area isn't as good as it once was and one of our neighbours is annoyingly nosy/intrusive.

Our life at the moment is very chilled, we're lucky to not have to worry about money because our costs are low (no debt) and very easy to reduce outgoings if we wanted (e.g. not eating out as much).

Would you go for the lovely unique forever home or opt for an easy life and travel/wait to move until house is paid off?

AIBU - buy it
Not - don't buy it

I wouldn't Think of the lovely things you could do in life rather than spend so much on a house to clean and maintain

You are planning on keeping both, right? If so, the answer is easy. Get the big one, let the small one to offset mortgage costs. You can always sell your "forever home" if it becomes too much.

We had about 10 years left on our mortgage, not quite the same as you but decided to buy our dream house and have a massive mortgage. Best thing ever, we love our new house and we are so happy here.

i wouldn’t buy it, I’d rather have a smaller home and be able to live my life, holidays etc without the stress of a huge mortgage

Honestly absolutely not! That's a staggering increase. You're so close to being mortgage free and in my opinion it would be madness to stretch yourself so far.

When I say massive, its more than affordable but a lot more and longer than the old one….

Surely there's a halfway house between them? Buy a larger house but not one with such a hefty mortgage as the one you are considering?

We rent. But If I was in your position and as there are no kids to house, I wouldn't move! I would be using the spare cash to dollops of lovely things and travel!! You only live once. Do you want to give up that freedom for a bigger house? Fair enough if you do. But I would think carefully before commiting to a higher mortgage if its not needed.

Or can you extend the one you have?

Why not just extend your current house? I wouldn't go through the upheaval and stress of moving if I could avoid it!

We can't extend at all unfortunately, it's a mid terrace property and very tiny back garden (it does sit on a canalside though, so we have mooring and nice water views - which is why we aren't overlooked).

With no kids you’re in a better position to take that kind of risk. We bought a house at the top end of our price range and really enjoyed living in it. We made it cosy so we enjoyed staying home a lot on weekends and pottering around. It was close to parks and cafes so we could walk out and get coffee if we fancied. We probably saved money just because we were happy to stay home so much. There’s a lot to be said for living in a house you love in a neighbourhood you love.

If one came up we'd definitely go for it, but the halfway between the two seems to be very overlooked (usually new builds) in a less convenient location without much of a size upgrade, so it feels like it would be worse than both options.

I would save the nearly £28k(!!!!) a year to spend on other things.

Why are you moving?

We did it recently with almost exactly the same figures. Best decision we ever made. We are so happy in our new house. One thing we did was sell our first house but not use the whole equity as a deposit for the new house, and kept some in a savings account. This gave us confidence that if either of us lost our jobs etc that we would have enough in savings to pay the mortgage until we got back on our feet. Without that it would have felt like too big a risk.

I'd probably go for it in your position tbh. You spend an awful lot of time in your house, I'd consider it worth it to have a lovely one if you can afford that mortgage, which you clearly can if it's being offered. How much do you both bring in a month?

Perhaps widen your search, yo look for a mid way house? That's a big jump

Why wouldn't you sell your current one so the mortgage is less on a new one? Your explanation didn't seem to make a lot of sense. By selling your current house you would be far less likely to struggle paying the mortgage on the new house, plus no need to pay extra stamp duty.

We need more space for our hobbies really, and we live in the house we lived in when we were students...we've moved on a lot since then. I guess this is it, we don't NEED to move, other than our nosy neighbour increasingly stressing me out, and being worried about some shady people hanging around the area (I think drug deals). We also have a very different lifestyle to when we were students, and our house doesn't really match that. It's a great starter home or great student let, it's just time to be more of an adult I think. I'd like to do gardening and things like that as well.

I'm very emotionally attached to it, I know that's not a great logical reason. It has memories of my pets and I like to think that a previously close family member I'm estranged from might knock on the door one day in future, I know that's unlikely and a bit silly.

What would you buy? I guess put it into savings/investments?

Don't forget some of it will be interest. Even if they were taking out the same size mortgage as before it would be probably be £750 rather than £500 now because of the interest!

You're being illogical because you would be choosing to make yourself more financially vulnerable than you need to be for no good reason.

If you have the option to keep your current house and could still take on a £2,800 p/month mortgage, surely selling your current house and using it as deposit on the new one would bring your monthly repayments down enormously? Am I missing something?