Housing dilemma - sell my house to rent somewhere bigger?

[Mimi07]

Me and my dh have a mortgage which is £850 a month. We have around 60,000 equity in the house but we're unable to buy somewhere bigger right now as he is not working. We have 1 year old triplets and an older child and work and childcare just isn't an option - it costs too much. So for the next 2 years we plan to manage on just my salary, which isn't huge - 24k.

We need more space - well, we're fine in all honesty and we could stay put for the 2 years but it's a bit of a nightmare. The other issue is the mortgage is eating up a lot of my wage. We have a car on finance and a credit card and by the time we have paid these things and bought necessities there isn't anything left which can be stressful when you have 4 kids.

I'm considering selling and renting somewhere - but realise this would just eat up all my equity - would it be the worst idea ever? I'm 30 - i feel like i have time to start again, but should i just struggle this next few years and deal with it?

Ok, writing that down seems daft and makes me think - yes, just stay put and be skint for a bit.

One thought i had was we could get a buy-to-let mortgage easier and get somewhere smaller (house would be around 90,000 purchase price and rental income of £550)- I have ran this past a broker and it looks do-able with about a 30,000 deposit. We would then have 30,000 left in the bank to pay rent for the 2 years until he can work and at least I know i won't blow all of the equity and we have some assets. Am I being daft? I over think a LOT and my mind just keeps running through different options to save us from the stress we're currently dealing with.

Good points raised by other posters. This model can work well for some people in some circumstances but you do need the ability to absorb cost of repairs and void periods, which it sounds like you may not have. Also don't forget to factor in that btl mortgages can be more expensive, and that you are likely to have to pay income tax on the rental income. The latter can really eat into your budget. With renting you also need to factor in deposits and fees, moving costs etc. Do run the numbers very carefully before making a decision.

I'd speak to your lenders to see if you can lower your repayments on the car and credit card and maybe look to take a mortgage holiday? This might allow you to build up a buffer going forward to give you some breathing space.

I really wouldn't advise selling to rent as it's unlikely you'll ever get back on the housing ladder without a lump sum in the future.

Are all the utilities on the cheapest tariffs?
Do you use a robust meal plan?
Have you got a plan to pay for birthdays & christmases?
Is the mortgage on the best available interest rate?

24k income for two adults and four kids should give you some UC entitlement- have you stuck your figures in a benefits calculator to make sure you're getting all the financial support you're entitled to?

I wouldn’t sell.

I would look at your house and declutter and reorganise.
I saw an article on some families who have multiple children but live in a Central New York tiny 2 bed apartment. They had such amazing space saving ideas. Also Marie Kondo has some good tips
With your outgoings can you go through them and either go on comparison websites to find a cheaper alternative or cancel subscriptions or other unnecessary direct debits. Also look at your shopping habits. Even down to buying a 20p can of beans instead of a 30p can. Can the car be traded in for a older model to save on the finances.
Whilst decluttering can you sell any things you don’t want to raise money to get rid of the credit card bill or any spare money goes on the credit card bill.
I use my credit card for everything but when I get paid I only leave enough to cover direct debits in my current account then pay the rest to the credit card. If you are then paying more to your credit card than you are spending it should start to come down more quickly.
Also, maybe not popular and I don’t know where you live but with triplets could you get them with a proper modelling/acting agency.
I think they would be very sort after.
Just be careful though. You only need family photos to begin with to get on the books of a proper agency and some of the stuff is incredibly well paid.
My son when he was little earned £900 for one days work on an advert then did another that was filmed over 3 days and earned another £3500. A lot of the time it wasn’t anything like that sort of money but it did help us out at the time.
We have repaid him over the years and he now has a nice deposit for his own house.

Also could you ask your mortgage lender if for the next 2 years you can go on interest only and extend the term of your mortgage

Thanks for all your help - I really appreciate it.

Yes, I think I need to stay put. My plan with the rent was to spend all my equity on it. I don't know why I thought that was a good idea but I'm so sick of checking my bank balance.

Well in 2 years, we will get the 30 hours funding for childcare and he would be able to get a full time, standard job and we could afford full time childcare with that help.

Currently he is working 2 - 10 shifts and we pay for 2 days in nursery and we do get a bit of help with this through Universal Credits and we are managing quite well aside from my work is suffering as I'm juggling the kids. However, it is agency work that he is on and they are changing him to 4 on, 4 off, 12 hour shifts. So we can't find a nursery that accept shift patterns that have space for 3 babies. So he needs to leave - especially now we have the eldest home schooling.

I am on a progression scheme at work and once I'm working at full capacity, I will be on 28K and this increases every year and is capped at 38k. I like my job and want to keep it. They are really flexible with me and I also don't pay into my pension - they do, though and its 12% of my salary. I can pay into it also if i want, but I choose not to at this time. I am trying my hardest to progress at work but I'm working probably half my hours due to juggling the kids - I work for a regulatory body (doctors) and we are struggling to get certain things done anyway due to the current situation. I am positive I can do it within a year if he's at home and having the kids in my work hours.

We manage fine now but with just my salary it will be tight. It's buying 3 of everything. food - we go through so much of it, especially when the eldest is home. We try to stick to £100 a week - i do one big Aldi shop that's about £60/70 a week and then we do top ups in the week for bread and milk and fruit - so much of that stuff!!! Before he got this agency job there was a time i couldn't afford to buy food that we needed, and I was waiting for pay day and I dread that happening again.

I think we can cut back though. The car is a no go really - we need 7 seats and a boot space big enough for a triple pram. I don't want to risk getting a car that will have faults and need repairs - where do i find the money for that! We can cut back on tv (£50) and I am in the process of changing my mortgage rate which will save us £60 a month.

To be fair, when you look at it all on paper, we should have around £600 a month after bills. It sounds ridiculous that I'm moaning about that. But we do spend a bit on food, petrol and just general stuff that we need. I'm clearly spending money on things without realising because it never feels like we have anything spare. We don't drink, I am a vegetarian so we buy very little meat, we don't smoke and we obviously don't go anywhere. It's literally nappies and clothes and just things we need. The babies need new car seats and I really don't want to put it on the credit card but it's going to have to happen and that just feels never ending!!

I'll sort the 0% transfer and just really focus on the fact that in 2 years I'll be in a better position!!

Oh, the house situation.

So there's us 6 and my elderly Grandma lives with us. She sleeps in an extension at the back of the house. We have a front room and a kitchen diner so honestly, sitting us all around a table in that room is rough but it's fine.

The front room is quite small and there's 7 of us to squeeze in when we're all home. All the baby stuff and old person stuff like walking frames and what not. We have 3 bedrooms upstairs, we have moved my eldest into the box room but her wardrobe has stayed in the bigger room as there's no space. We had to buy a caravan bed for the box room as it's so small - i didn't even know these existed.

The babies share the second biggest room although I don't think there's much in the 2 bigger rooms anyway. They currently have 3 space saver cots but these aren't going to last much longer and i think i will get those extendable beds from Ikea as I imagine we will fit 3 in - again, on the credit card!!

Storage for toys and all the stuff that comes with kids is such hard work. We have a small garden due to the extension that is already at the back and the loft isn't deep, you can't stand up in it so a conversion wouldn't work.

We're going to stay put and just deal with it. I need to stop my mind from thinking!! But we will manage and then in 2 years time, be in a good position to buy somewhere decent.

If your DH was employed is he claiming universal credit contributions based job seekers allowance ?

Seen update

@Inside00ut We claim on Universal Credits.

He doesn't have to work because he is classed as 'looking after children under 5'

We do get an entitlement of around 1400 but this is cut down based on any income and we're paying back a advance that we got when we first applied for it. We end up with about 600 a month i think. I'm not completely sure as our entitlement over the last few months has included the childcare element and we've had both our salaries deducted from it, so this will all change.

He lost his job last year when the babies where about 2 months old and I was on maternity leave. So their was a period of time when we were absolutely struggling and we took a mortgage holiday then. We have only just finished paying off any arrears from that time and the mortgage holiday was pre covid so affected our credit score quite a bit, although it seems to be improving a bit now.

So we applied for UC and got an advance as you wait 5 weeks to get anything. I had to give work 8 weeks notice to come back earlier than planned. It wasn't fun.

He's only just started some agency work in September - we looked for ages for some evening shifts that would bring some money in and the best he found was this 2-10, but they're changing it now to 12 hours shifts and it isn't manageable. He could look for something else but with childcare it's really hard to find something.

I'm flabbergasted that you're surviving on a 24k salary and an £800 a month mortgage! And a car loan. You guys must be really struggling? 🙁

But some 2nd hand washable nappies even if you only use them for 50% of the time it will save ££££££ yes it's another load of washing per day though.

If your DH is no longer working then he will have more time to shop and cook cheaply which will help.

Start writing down every penny you spend and see where it's going and potentially save a bit more.

Try and buy what you can 2nd hand and sell on what you can too. If you start looking for toddler beds or cot beds now that could be loads cheaper than buying new even from IKEA. Mine were in cot beds until school age and were very tall DC.

Your finances are very similar to what ours were when my 4 for little although we didn't have triplets I did have 3 in 3 years so I know how chaotic it is!

Does your elderly relative contribute to the running costs of the household & food ?

Re finances, does the elderly relative contribute anything?

@Inside00ut @Merry2021

No, not really.

She pays for the water bill which is about £60 per month. It's frustrating as I know she has a lot of money in the bank. I take her occasionally so she can draw thousands out so she doesn't lose her pension so lord knows what she has in the bank and she also has thousands stashed around her room.

If she requests anything specific from a food shop, she will give money for it but in general, no she doesn't really pay for what she uses. Its quite draining as I am now having to do most things for her. She can dress herself but even things like shutting her curtains, I'm expected to do. I just feel a little bit pulled in all directions and to be honest it would be easier having my dh at home than me having to manage working around 4 kids and my Nan.

tea times and bed times are chaos and then once the kids are sorted, I have to help my Nan to her room and help her in bed and do her curtains and get her drinks. I then have to go back before I go to sleep to make sure she has everything she needs. It's mentally exhausting.

If my husband could get a job that started after 4:30 when I can finish work, then it would be easier but there isn't much of that about at the minute. He could get a pub job once they open, but right now he is quite limited. Even supermarkets - any evening shifts tend to be stacking shelves overnight but then when would he sleep as I need him up at 8 to have the kids whilst I work.

@RandomMess good idea with the bed. I have one that is more able than the other two so i could potentially get her in a bed within the next few months so I suppose buying the beds as and when I see them for sale second hand could work!! Thank you!

@Perfect28 Well we did survive on that but then my husband has worked since September which has really helped. Going back to one wage is scaring me but it is do-able. We do get some UC, I'm not exactly sure how much it will be as our circumstances will change now but I work it out to be about 600 a month. The thing is i lose some of my salary to student loan payments but UC count that bit as my earnings so that's annoying, but is what it is.

Christ OP, I have 3 elderly relatives and none of them would live with me and watch me struggle financially like this whilst hoarding thousands of their own

I am sorry but I really think your nan needs to contribute or move out. That might sound harsh but you can't lose your home to subsidise another adult who isn't helping at all.

I think you need to drastically question how you live your life and your priorities. There is so much to unpack here but please put your home and your health, your children, your marriage before your assumed caring responsibilities.

Indeed Nan needs to contribute more!!!

Surely you need to have a conversation with your relative about contribution to household ?
3 adults, so bills should be split 3 ways for utilities, council tax, food
Can you or they apply for carers attendance ?

Nan needs to pay rent
That would make a big difference I think.

You need to have a strong word with your nan OP. She must fucking know you are struggling!!
Tell her you can't cope and that she needs to pay you rent. She can clearly afford it.
Tell her £100 a week.

Can you also get carers allowance for her as she needs constant help?

I think both ideas sound like a money pit. I can't see either if them offering a serious improvement to your lifestyle. They would just add more stress and complications. I'd stay put
Until your situation improves re being able to increase your household income and then look at taking a mortgage over the longest timescale possible to keep your payments down. I know conventional advice is to pay off as quickly as you can but you are young enough to change the mortgage & reduce the repayment period later, if you are both in good salaries in say 15 yrs time. Stability is what matters with 4 young children and that is worth more than the anxiety of renting your own accommodation or being a landlord