To double our mortgage at 36?

[EponymousEponine]

We (DH and I, both 36) bought our 5 bed 2 bathroom home 7 years ago as a project for £267k. We've since done a lot of work, remortgaged and currently owe £221k, with 33 years remaining on our mortgage. The house is worth £400k and our current interest rate is quite high as we have had some financial struggles in the past which limited our lenders. We pay £1250/month. Aside from electrics & plumbing I've done the majority of the work myself.

Our home is great but has room for more improvement if it's to be our forever home. We have 3 DC (8 and under), two of whom may live at home longer than usual due to additional needs. We're located less than 10 mins from my Dad at the moment, and the same distance from DC's school (and also the high school theyre likely to go to). The area is OK, its not the nicest but our street is safe and its more affordable than where my Dad lives, hence why we could afford a good sized house for a decent price. But there is a ceiling on the value. My biggest issue is the small garden we have, which was the only compromise when we bought it.

Another house has caught my eye. Its another project- on a bigger scale than our current home, but its in a frankly amazing area where most properties are £800k+. It's currently listed for £525k but isn't selling - it would require a lot of work which may put a lot of people off, but the potential is huge. Its got such gorgeous original features and is double fronted which is my dream. It also comes with an acre of land, a mixture of a large garden, small wooded area and open field. DH and I viewed it and I fell in love, but the catch is that its 40 minutes away from where we are now and would be a similar length drive to my Dad & DC's schools.

I'm completely torn. In theory we could sell our house, put down a 10% deposit (ideally pay 450k-500k max), leaving us £100k for immediate works to get it liveable & we'd then either do the rest ourselves or refinance. It would take about £200k to get it completely done to a nice spec, but then it would easily be worth £1m+. Obviously we'd be saddling ourselves with £400k+ of debt at 36, but the repayments wouldn't be too much more than what we're paying now due to us being more likely to get a better interest rate now. And we'd end up with a beautiful home which would be more likely to rise in value over time due to its location (very rural, no neighbours, adjacent to coveted Yorkshire village). The outdoor space would give us the opportunity to have a mini smallholding with a couple of goats, ducks and some chickens - always a dream of mine (and DD would love this too)

DH earns £85k/yr (a fairly recent development due to career progression), I earn £22k/yr part time (which is needed so I can accommodate our 2 children with additional needs, 1 of which doesn't attend school full time). It feels like a heart vs head choice. Staying is the head option - if we stay here we'd probably spend £50k on an extension to give us a better configuration, additional bathroom, utility room, downstairs wc. But overall mortgage debt would be half so better chance of repaying it/retiring early etc. But my heart is telling me to go for the beautiful dream location which would provide better long term financial growth with short-medium term inconvenience due being 40min away.. DH is happy whatever I decide.

Help please! My late mum would be my sounding board and since she died I'm without someone to talk this over with. AIBU to move to the big project house? YABU = stay put, YANBU = move

God your username is cracking me up 😂
How do you feel about the decision now? Did you make the right choice?

I would go for it OP. You’re still young.

Absolutely this.

Not counting any extra journeys (picking one up early or late or a performance in the evening etc).

This would make me say no more than the financials or the work you'd need to do.

If you move, would you still be in the catchment for the secondary school or schools you want? Would you be in the same county, as it can cause issues to change local authority with an ehcp. Have you asked the estate agents why it isn't selling? You would probably get a vague answer, but they can't outright lie if it has sever subsidence and is riddles with asbestos.

The septic tank has to be made up to date by the seller. Our mortgage company withheld some money until the work was completed after we moved in then gave them some money back. Just beware that they run the project and it needs to be checked by the council for completion. Also we moved from a 3 bed £40 -70 a month gas and electric to a 5 bed £500 a month for the gas and electric do er upper. Bit of a shock hopefully less after new roof insulation, next year will be double glazing.
we do love it though.

Whatever you decide I would ensure you get a proper survey done, if desirable and potential to be worth more than £1m I think you have to question why it's not selling, sure a developer or someone would be able to see past the current state.

I would wait and see what the Budget brings next week before upsizing into a house which could potentially trigger large annual property taxes.....!!

It's all very well your dad saying not to factor him into your decision but practically speaking he very much is a factor and being that much further from him might end up being stressful for you.

The house does sound wonderful though!

Rural living is fine with toddlers. As they get older you’ll spend half your life in the car ferrying them here there and everywhere.

I think it might be a bit selfish to give your kids a 90 minute daily commute for the sake of a double fronted house.

That would be my concern - poor credit and a large mortgage will be very expensive. Looking to double the amount of borrowing while taking the LTV from less than 60% to 90% is not only going to make it more expensive, but severely limit the number of lenders I would have thought.

For someone who could borrow at competitive rates and could pay down the debt reasonably quickly then it sounds like it would be a great opportunity to create a fantastic family home. Borrowing £450k with a combined income of just over £100k ought to be doable.

But, I also wouldn’t be banking on a buoyant property market in the short to medium term, and if the £1m valuation for the finished project was actually nearer £800k, and the cost of refurbing £250k not £200k then you’ve gone from adding £400k of value to £150k, and the interest cost on the extra borrowing over 10 years might easily wipe that out.

It sounds too far away and too expensive.

We went from 380k mortgage to £660k mortgage at 38yrs old, so my appetite for debt is fairly robust.

I think you’re kidding yourself giving a £200k reno cost (yes, I live I’m a seasoned renovator who has so far sunk £150k on my 1800s house).

I agree with this. We went 2.5x mortgage in late 30s as a very high earning couple. But now late 40s, I wish I hadn’t (tho I love the house and location) and rather wish I was close to paying it off. If I could do it again, I’d choose a cheaper location and compact size unless I was buying in early 30s and high double income.

The money wouldn’t be the issue as far as I’m concerned but the commute and the damp issues would be!

Have you done the school run at rush hour - go out earlier in the morning and drive from the village and back at the time you would need to leave - 40mins could be far longer at that time! I live less than a 5 minutes drive from my child's nursery and when it’s raining or there are roadworks it takes 20-30minutes! I commuted for years and when you tot up how much of your life is spent sitting in traffic it is thoroughly depressing. You are looking at a minimum of an hour and 20minutes return journey twice a day for the next decade or so - that’s 2 hours and 40 minutes a day or 13 hours and 20 minutes over 5 days!

Have you had a company that specialises in damp to assess the house? I ask this as my mum was at the closing stages of buying a gorgeous old house she was totally in love with and they found that due to water under the house it was sinking into it’s own foundation. Also think of climate change, if the bottom of the garden floods now in ten years that could be the house. Will your house be insurable in this instance? How much will it cost to get the septic tank made compliant?

Putting all the house stuff to one side for a minute - I do think you have to factor in what you will want to do for your Dad. My DF has advanced dementia now and his care home is 15 minutes from my house. That means if I go down and he’s asleep or having a bad day, it’s upsetting but I know I’ll be able to do another pop in within a couple of days. It means when anything happens I’m there within moments. It means I can pop in over my lunch hour and be back without work being impacted.

It’s an arduous journey having a parent with dementia. It’s even worse if, like me, you’re the only child who bears the burden. My dad would say exactly as yours if we wanted to move - and I would rather cut off my right arm than make myself less available to him. We have a future move planned but it won’t happen until Dad goes, for that reason. So it’s important to factor all of that in, alongside the house maths.

These are all really valuable comments thank you. I think its because I don't have a commute (I wfh) that I've not given much thought to the trips to/from school but youre absolutely right and it does add up. I wonder if I could do a dry run one day when DH is around to take the kids to school and time it as you suggest.

Thankfully I'm pretty clued up on damp issues as we had plenty in this place when we bought it! And the nearest neighbour runs a glamping business from her property and has a publicly available flooding projection taking into account climate change etc which I've pored over (honestly couldn't believe it when I found it after some Googling!)

We've been told by the agent that the sellers have agreed to make the septic tank compliant prior to completion but will only start the process once a proceedable offer is on the table.

Thank you for contributing your comments and I'm sorry you're in the dad dementia club too. Its not a fun one is it. To be perfectly honest this is probably my biggest concern and the thing that's held me up to date (we viewed the house in August). I adore my Dad and whilst I do have a sibling, we are very close and I'm the only one he will ask for help/be vulnerable with. He's my biggest priority, especially after losing my Mum unexpectedly (although they weren't together its a bit of a reality check that parents aren't invincible)

Personally I wouldn’t, I wouldn’t want to be tied to a mortgage passed the age of 55 at the most. I’d much rather have spare money to make memories, go on holiday and have treats wih my friends and family.

i also wouldn’t want to be travelling 40mins to school, what happens if you are unwell or the car doesn’t start, how do you get your children to school? How do your future teens go out with school friends for the day when you live 40mins away?

what if dh can’t go to work due to illness, what if dh loses his job? Who pays the bills, who pays the mortgage?

you need to think of every eventuality when stretching your budget so much.

dh had an accident at work and couldn’t work for 6months so these things do happen.

I echo the comments above about the commute. We considered the length of the day very carefully when choosing a secondary school for our eldest (who is autistic) and chose the local one to maximise her down time outside school. Other options would have included a 45-60 min commute. That extra time to decompress (plus the fact that most of her friends are local) has really worked for us. I wouldn’t give it up for a 40 min commute for any money- some days she’s mute after school so I’ve no idea how she’d cope with a commute like that. That said, your children could be very different to my daughter.

and that’s without considering your dad and his future needs.

The travel isn't sustainable for children or you. How do you envisage having 3 hours on the road per day and doing everything you currently do?

Don't underestimate the length of that commute on children, especially children with additional needs.

Thats 3 hours driving without you going out and about during school hours. What if your DC want to go to clubs such as Cubs with their school friends, how is that going to work.? Or one is in an after school club and the others aren’t etc etc?

This. It’s not the fact of the drive.

Its 15 hours a week at least for your kids sitting in the car bored, hungry, tired, wanting to play with their friends or just get home and chill.

sitting in a car is horribly unproductive time and you are essentially adding two full work days of it into the working week for both you and your children.

I wouldn't do it for this house. 40 mins drive from school is quite unpleasant for your children, especially considering they have additional needs.

I think you should do it, I moved into a new house when I was 38 and more than doubled my mortgage. Life is too short for the what ifs. It sounds like a cool opportunity for life changing amounts of money at the end. Unsure how long your kids have left at their school but I would probably think about moving them somewhere closer. 40 mins each way is a huge amount of dead and wasted time.

This.

Where we live, any potential money making opportunities no longer exist. Developers snap up any bargains before they’ve even hit the market, and when I say bargain, I mean any house with a sliver of potential profit. Certainly no 500k houses are being flipped for a million any more. And the only people that do buy any potential bargains are builders or proper developers with huge reserves of capital. I’m afraid that doing up one house does not make you a ‘seasoned developer’, op!

You outline some pitfalls associated with the property. I imagine there are many more, because if it is the gift horse you think it is, it will have been snapped up long ago. Remember that builders and materials cost a fortune too. I’m sure you know that already though!

I wish you luck. I can see why you want to do it, it sounds amazing, but do check it out really thoroughly before committing to a money pit that will break you as you get older!

Sorry to sound so negative. Dh is a builder and we’ve done a fair few places in our time but now we’re 50 are breathing a sigh of relief that the only work hanging over us is routine maintenance and redecoration!

Yep - it absolutely sucks! Harder than I ever thought it would be. Particularly now he doesn’t recognise me anymore. Can’t do any of the things he used to love to do, so no quality of life.

ANYWAY. It is what it is 🤷🏻‍♀️ Good luck with house decisions though 🙂