Trapped in flat wwyd?

[Trappedinflatandskint]

I've posted in property but thought wise money mnetters might have some ideas.

Feeling trapped.

Currently live in a two bed shared ownership property in London. I bought 40% four years ago on my own. Market value for 100% was £395k. Recently valued at £385k. Could be worse. I put down around £25k (15% deposit on the bit I bought).

DP has moved in and we want to move. We don't have enough space and are hoping to have kids soon via IVF (so a load more money and we're old so time is of the essence). We both WFH.

We can't afford to sell this and make a loss - we don't have savings to put down a decent deposit anywhere else. We'd considered buying the remaining 60% of this place and renting it out, which we also can't afford to do currently (DP is recently self employed and needs to wait 18 months before applying for a mortgage, we'd also need a chunky deposit). We could ask for permission to let out without buying rest of flat but I'm nervous about being a landlord for all of the obvious reasons.

We've even considered letting out the largest bedroom and ensuite and keeping a room as a London base while we rent a house elsewhere.

I don't really know what I'm asking. We're desperate to get on with our lives but have v little savings.

What would you do? Let/sublet? Just sell and bank the money while we rent elsewhere and save while also paying for IVF?! I love this flat, and it's the only secure (ish) thing I've ever had financially, and it's mine, not DPs I don't want to lose it without getting something better in place.

Why do you need to move now? I would make it as liveable as possible until you are through IVF and have hopefully also saved up some extra for a deposit on a new place. A two bed flat should be fine even with one child if necessary?

Is there any chance your DP can rethink going self employed? That is obviously a factor. If you’ve both decided that is the right thing for him to do then obviously you have to accept there are financial consequences which come with it.

And if baby comes along, is there any chance of either or both of you renting some office space elsewhere, so you can reclaim the 2nd bedroom?

Would it be possible to make some changes to make it feel a bit bigger for now (getting rid of furniture, stuff, donating etc).
I do get what you mean though about feeling cramped. But it sounds like your best bet is to stay put until the value increases .

Check if letting is even an option with your shared ownership agreement. Often it isn't.

It’s bad luck it has gone down but have all other flats in your area? You have lived there for 4y and “lost” £10k but if you were still renting you could been paying £1k a month. So compared to rent you are still £50k up on the situation.

If you sell you will still get some of your deposit back even if the over all price has gone down and does give you the option of starting again.

Who valued the flat? estate agents valued ours at widely different values.

I would either test the market by putting it on or sit tight and save for a while.

You usually can't let on shared ownership, sadly, although check your agreement.

I wouldn't move, quite honestly. It's a poor financial decision, and it removes your security.

DP needs to either reconsider being self-employed, find a co-working space (either paid or walk-in) to use, or you have to make a plan that means you can work from home.

We've been in a one-bed flat for two years, with both of us working from home. I'm pregnant. We're careful to try and go out and break up the stir craziness, and both of us have to make an effort to be quiet when the other is on calls, and tidy, but it works - and even people in big houses have been stir crazy during lockdown.

It makes no financial sense to move in your current situation, really.

You might struggle to rent elsewhere even if you can rent your current flat out, for the same reason you'd struggle to get a mortgage.

Just stay there the 18m, accept it and get on with everything else in the meantime.

Renting an office to wfh from is a good idea. Near me they are £15 a day for a desk in a shared office.

I don’t see the issue at all with your current property. You have three rooms to wfh in a bedroom each or the living area. IVF is a long process and even if you had twins your flat would be perfectly suitable up to age 10, longer if same sex.

Since it's a 2 bed, could you stay put?

What’s the urgency to move? I wouldn’t sell for a loss and renting elsewhere will be really expensive.

I wouldn't personally want to be a landlord, too many variables & too much stress (for me, anyway).
I'd probably sell and buy elsewhere. If you both WFH, can you move further from London?
I'm guessing with a £25k deposit on 40%, overall value reduced by £10k (so roughly £4k on your portion) plus 4 years of mortgage payments... you've got something in the region of £35-40k equity?
I'd speak to a broker - with a smaller deposit your interest rates won't be as favourable but you might be able to make it work if you are outside of London?

I would stay too. We live in a two bed flat, well, maisonette and have two teens. You get used to it, luckily we are right next to beautiful countryside and it is rare that we are all at home at the same time.

Agree with pp. If you want children (and clearly you do if planning IVF) and you're on the older side, I'd prioritise that over a less than ideal living situation.

I say that as someone who had a 5 year old and a baby in a one bed. It is doable.

I would stay until prices go up and I've saved enough to move with. But how would you afford a bigger property, when you only own half a flat that's lost its value? Sorry if that's a rude question.

While I definitely wouldn’t want to be in a 2 bed flat with 2 10 year olds, while you are going thru ivf and not pregnant yet I don’t see the problem? Even if it works first time that’s a year, then there’s no real need to move for another year after that. Wait, save, wait until your partner can get a mortgage. There are loads of workspaces in towns now, not expensive and the time to sell is not when the price has dropped.

We lived in a two bed apartment with our daughter and it was great. We only moved just before the birth of our second child and to be honest, we could have stayed in the two bed apartment for a few years with two kids no bother. I wouldn’t be stressing yourself out unnecessarily. Concentrate on the IVF. Things have a way of working out. Kids don’t need a lot of space or toys/equipment. I certainly wouldn’t go renting a bigger house and renting your apartment out. That’s not a sensible use of money.

Another poster here saying stay and make your flat as nice to live in as you can. One bedroom is a potential nursery/kids room but for now an office. Then either have another desk in the living room or your bedroom.
Save as much as you can towards a deposit for when you do eventually move.

As everyone has said what’s the rush to move? You would have space with one child where you are, it would make sense to stay put for now.

If I was in your shoes, as pp as said, I’d stay put for now. It makes no sense to sell at a loss now especially if what you get from the house cannot be deposited into another house straight away. The chances are you’ll end up spending it.
It’ll be at least 9 months till you have a baby and then your DP has just a few months before he’ll be in a position to buy so you’re good in that aspect.
Also, if you both WFH permanently and don’t have to see clients, can you move to a cheaper part of the country?

I think you would struggle to get permission to let the flat. I saw your other thread. Did you say you are both working from home? I would either:

• Stay. Lots of people live in 2 beds with children. We did although we weren't wfh. Save what you can towards your deposit. Hope prices of flats rebound a bit.
• Sell. Try to get a shared ownership bigger property out of London or rent for a while.

Staying is really your most realistic option financially. You just have to weigh up whether it is more important to you to have more space than security of property.

If you need more space then can you move to a cheaper area? Maybe another shared ownership place?

@MyDcAreMarvel

I don’t see the issue at all with your current property. You have three rooms to wfh in a bedroom each or the living area. IVF is a long process and even if you had twins your flat would be perfectly suitable up to age 10, longer if same sex.

^^This

You have a,two bed secure flat.
You love the flat
You can have baby or two in it
You could
Rent separate storage or office space.

You bought to have security of "owning" not to make profit right?
Fall of 10k on that price is not huge % and your share is less.

So sell and take your share of equity
Or
Stay put