Has anyone gone for the smaller, more affordable house and not regretted it?

[Housechoice]

As above really! It’s the debate I find myself having with DH. We’ve 2 very young DC (no plans for more) and are weighing up the pro’s and con’s of a reasonable house for say £350,000 with some compromises versus a bigger ‘ideal’ house for say £450,000 which ticks every box. Location wise both would be similar area so no compromises there.

The Mortgage saving would be big by not taking out an extra £100,000, so less financial stress/worry.

I’m looking for any insights on those who found themselves making a similar decision and whether there’s any regrets either way?

I went for the smaller option and I love it. It means I can work part time without money worries and I'm over paying on the mortgage so hope to have it paid off in 12- 15 years rather than the full term of 25.

There's also less cleaning to do so I have more time for other things. I've also become a lot more conscious of what we buy as storage space is limited and I'm wasting a lot less money on that and gadgets that get used a few times before being forgotten at the back of a cupboard. We do a car boot sale once per year to declutter and the kids love the extra money for their money boxes.

I moved house quite recently.

Pros: there was 1 really annoying thing about old house, that we couldnt change, that is just so much better in new house.

• new house just has everything we would want - lovely big kitchen, great big garden, kids both have nice bedrooms etc.

Cons - we were mortgage free on old house, now have a big mortgage again. It does make me more worry prone about jobs/savings/pensions. Rates just keep going up so money is tighter than planned.

• apart from the one thing that annoyed us, we did love the old house! The kids especially were quite attached to it.
• the house and garden take a lot of cleaning & upkeep.

I wouldnt say i regret it, i love the house. But i hate the mortgage!

We went for the smaller, well arranged house in a superb location. The bank would have lent us £500k and we bought a house for £200k.

We love not having loads to maintain or clean, the low bills, and not having to worry too much about job security or mortgage rates.

And a combination of savings and overpayments means that we will either pay off the mortgage very quickly, or we can upsize in future if we want to. Even if the worst happened and one of us lost tour jobs, we would be able to afford everything on one wage.

I’d love an extra bedroom and more entertaining space, but they would only be used a few times a year! Our little house has everything we need.

I also like that we can’t acquire loads of clutter. I’ve seen garages, lofts or spare rooms that are full of junk!

smaller house , I don’t regret it . It is the only way we could send our DS to private school and for us was money well spent . Also we both went through redundancies (not at the same time) and we managed on one salary until another job was found. Now paid off, we are building pensions up . We are both middle earners though.

Our friends stayed in a very small terrace instead of moving to a bigger one. Everyone in a box room. In quite a rough area.
Was about £1000 less per month. They use that money to go on loads of holidays instead. They have been all over the world. Their teens were in the discussions about it and agreed to go for holidays over space.
Also cleaning is very quick!

We chose to have a smaller mortgage and pay it off quicker. However I wouldnt say we compromised on size too much. It did need modernisation though. I do think it would have made a better financial choice to buy a more expensive house and stretch the mortgage over the longest time possible and then downsize come retirement as it would have gained more equity than our cheaper house. However it comes down to risk, some people are happy to risk property price increases and job security. I think we were too cautious and may move and borrow more in a few years. To clarify though we could borrow twice as much as we did which could have bought us an already updated house in potentially a nicer road. If it was a case of only being able to borrow an extra 100k it wouldnt have made much difference to the type of house where we live.

I went for the more affordable house, smaller, better location and the potential for improvement. As the mortgage became more affordable we had a loft conversion and extended front and back to give us extra room. I’ve never been in a position where I worried about whether we could manage the bills or what would happen if one of us lost our job. Had we never had more money, our three bed semi would still have housed us comfortably.

edited to add, it allowed us to pay off a 25 year mortgage in 17 years and then put all that extra mortgage money into our pensions.

We went bigger and thank God - I think of some of the smaller houses we looked at and shudder at the thought of having been stuck in them with teens, and teen friends, and with covid and (now) wfh. We live in a cheaper area of the country though. I wouldnt have made the same decision in other parts of the country.

My biggest regret is not buying a bigger house when we could afford it because that house would have tripled in value. Our smaller one only doubled. We then moved to a bigger house anyway. 100k doesn't sound like much if it's an ok house vs an ideal one. House purchase you should go with your heart if it will be your PPOR for a long time. You should buy the best house you can reasonably afford in the best suburb closest to the city centre of wherever you live. You'll always make money.

We went for a smaller house and have no regrets. We don’t have to worry about interest rate rises, and can afford to go on great holidays.

We know a number of older people who have had to downsize as they got older, so although more space would have been nice when the DC had lots of toys, and a bigger third bedroom would be good, the house is the perfect size for the two of us in the long term.

We went for the big house, detached 5bed, 3bath, conservatory, double garage, large drive with turning point. We had a baby and toddler as the time, it was a stretch, house needed redecorating, new carpets, all bathrooms needed replacement, including kitchen and utility room. We didn’t want the hassle of moving again should we have had more children, we didn’t in the end.

We have since downsized and relocated due to my health, kids are adults now, one has left home. We were able to buy a bungalow 3 double bed, 2 bathrooms, plus two smaller properties that are residential let’s. So well worth it in the end, we would not have downsized as early if it hadn’t been for my health though.

We went smaller and have been very glad we did when interest rates went up. I’m able to work part time, have been able to help the dc with uni costs and getting a car. Also easier to maintain.

We moved areas because of work and with a history of redundancies decided to go for a smaller house so we could buy it outright without using up all our savings. Next door a larger house was also on the market which would have taken most of our savings and we decided against it. Now we are considering retirement and the part of the country we want to move to is more expensive so I wish we had bought the larger house which would have appreciated in value more than ours so we could afford it. However it has been lovely being mortgage free, the house is nice, bills are lower and we have had some fabulous holidays. You can't have everything!

Well hopefully not always to that extent! I know you think it's great, but I find the idea of house prices trebling and doubling absolutely horrifying - no wonder people are struggling to buy.

For contrast, our house hasn't even doubled in value in 20 years (and that's typical for the area).

I dont' think it's great actually. But I don't set the market. My point was that if you can afford it a larger investment is usually better in the long run than a smaller one and for most people their principle place of residence is the largest financial investment they will ever make. It's all risk based though isn't it, like your personal appetite for risk but most people make it work somehow.

Because no one has a crystal ball there is no real answer , interest rates may never come down to the low rates they were before and could still rise & all bills are going up . If you have lots of wiggle room go for the bigger place , if things are tighter go for the more affordable home .

Is this your 'forever' home?

For our short term home with young DC, we went cheaper which was helpful with nursery fees etc. we thought we would be there around 8 years but moved after 5 years due to job relocation. We did make quite a bit of money on this house from sprucing it up.

The next house, where we live now, we went for the bigger option and I am so glad we did. We've been here 8 years and now have teenagers. I am SO glad we all now have a place to escape to.

On the one hand I regret the smaller amount of living space we have, we don’t necessarily need it it but it would be nice to have a separate dining room and larger kitchen, but our mortgage is so small, and I don’t know how I’d feel if I was having to pay a lot more each month, I think I’d find it stressful.

Im certainly regretting it. I need to move back to Sussex from Somerset and now I cant find a house in my price range.

This is an interesting read as we're weighing this up. We are currently early 30s, in a two bed terrace house. We know we need to move at some point to be nearer family, but that would be to a more expensive area. We love having a low mortgage we can overpay and put that money towards other things.

We're weighing up a cheaper 3 bed or a more expensive 4 bed with room to grow over the years, but we don't have to move again! About a difference of £75k.

Hey OP, I’ve went for a ‘compromise’ and regret it, life’s to short and ends up more expensive moving to the right house eventually. I’d go for gold next time.

MIL bought the tiny house in her mid-30’s (rather than stay in the larger house that she could have kept after her divorce).

She paid off the small mortgage by 50, then spent the excess each month on holidays and clothes. She could have extended the small house, but didn’t as she didn’t need the space then. She then retired at 60, despite being perfectly well and able to work another decade.

Guess who now doesn’t have any option to downsize and release capital 🤦🏼‍♀️ Also, cost of living has increased massively in the past 15 years since she retired and her comfortable pension amount is no longer comfortable.

The cost of an extension on the small house is now exorbitant, so wouldn’t be viable.

In any case, the bigger house has increased much more in price and would have given her so much more freedom in old age! I’m only annoyed now because we’re subsidising her by paying for holidays, meals, new car etc.

She can’t afford to move to our county now either, whereas if she’d kept the bigger house or extended her small house she’d have many more options!

In your case, it’s not just about how much money you have now, it’s the fact that a bigger house means you don’t need to move again when your kids get bigger, it also gives you more potential upside for housing prices increasing and also you have somewhere to downsize from when you’re old.

We went smaller/more affordable house and have massively regretted it. We bought our house over 10 years ago knowing we wanted 3 children. I was very risk adverse and thought 3 maternity leaves we should be sensible. What i didn't bank on was what would happen to house prices in the meantime, they increased to such an extent even with our career progression and increase in earnings we just haven't kept up with the market. As our house is a fairly modest 3 bed semi the increase in value on it just isn't as big as the increase in value on the house we need to move to (that we could have bought in 2015). We did have 3 children and now face a huge leap, taking on a big mortgage in our 40's. Had we just bought bigger in the first place we probably wouldn't even need to move and even if we did we'd have made a tidy profit on the increase in value, saving ourselves easily 200k+ (the houses we are looking at now go for 550k if not considerably more, back in 2015 they were around 300k).

On the flip side we have never stressed about increasing mortgage rates as our mortgage has always been tiny and will be paid off in about a year (we are early 40s), but we are looking to move about then, our mortgage will triple to avoid paying it until we are retirement age.

We bought a bog standard 3 bed semi in a nice area that cost less than 1 years income.

We saved up and paid cash for it.

I earn around 200k and still think it’s the best decision I ever made. All peers at work live in huge £1m+ houses with mortgages which is fine if that’s what they want but the security and lifestyle afforded by purchasing a cheaper house has been incredible.

I’m early 40’s and could easily retire now and fund the family for life including school fees etc. Pension and investments have grown way ahead of house prices in a large part because I never paid a penny of interest.

I believe my quality of life has been way better than that of colleagues who burdened themselves with huge debt to pay for houses that were way bigger than they needed.

We've recently gone from a big house to a small house and I don't ever want to live in a big house again! SO much less to clean and keep tidy.