How do you move to a bigger house?

[Doubleesspresso]

We have a three bed semi that I like. However, there are 6 of us and I’m feeling the size of our house getting small.garden is also tiny.
My Dh snd I both work but in public sector roles where salaries are fixed.
Therefore, we are unlikely to have a huge change in income, other than saving, how do people manage to move to a bigger house as I just can’t see how we can, other than move to a cheaper area? However this means changing schools etc

You pay off your mortgage, which provides equity that acts as your deposit. Can you afford to take on a larger mortgage or were you at your borrowing/affordability limit with your present home?

Some people do move to a cheaper area, that's one way. They also earn promotions or change jobs to increase their salary. Plus save some of their spare money each month towards the cost.

If none of the above are options, then you stay put. Can you move to another area of the country? One advantage of being employed by the NHS is that you can work just about anywhere and there are plenty of areas of the country where even a band 5 nurses salary is above average so if you both earn this sort of money, you can afford a larger home than most.

Sorry, I see you are public sector but not necessarily the NHS, but the same principle applies.

Can you build an extension on current home or loft conversion?

We spent 5 years in our old house overpaying the mortgage,

the equity in that one is what gave us our deposit for the new one, in that 5 years we also both got better paying jobs but not overly considerably increased salaries.

Yeah it's a tough question really, the short answer is they just have more money one way or another. Sorry that's not very helpful to you, I would guess the most common ways are borrowing more money/bigger mortgage (possibly linked to getting promotions or pay rises hence banks prepared to lend more money), inheritance or gifts from family or moving to a cheaper area. If none of the above are possible I think you'll just have to try and live very frugally to save some more money and wait until your current mortgage goes down enough to be able to borrow more - so e.g. if you took out a max mortgage of say £100k and bought a £110k house, paid off as much mortgage as you could and managed to get the mortgage balance down to £75k, assuming your earnings and value of your house hadn't gone down in the meantime you could then reborrow £100k and use the £35k equity towards a house costing £135k.

It tends to be cheaper to refurbish or extend existing houses than to buy a 'ready done' house so one thing we used to do back in the day to get a bigger house than we could really afford was buy wrecks (mortgageable but in many cases barely habitable) and do them up gradually as we could afford to, it meant living in a building site for months on end as we never had the capital to do all the work at once and we rarely had a 'finished' house for long with all the decoration and new kitchens/bathrooms etc done (so not for everyone, couldn't have done it with small DC in tow for sure), plus we did as much of the non skilled work ourselves as possible to save money but we did end up with a much bigger/nicer house at the end of it than if we'd just bought something ready to move into so that's one thing to look into...

Thanks, yes that’s helpful to hear! I hadn’t thought about overpaying. Yes sadly have done as much as we can to our house already, and not to sound ungrateful, i do really like it, it’s just small.

The only way to move to a bigger and more expensive house is to either have savings to make up the difference or increase your mortgage. Another possibility if age allows is to increase the term on your mortgage to a longer term and try to keep the monthly payment to a similar amount. Assuming you have the equity in current property to fund the deposit. We moved from a 3 bed semi to a 4 bed detached 3 years ago. Family of 6 also. We use the downstairs playroom as our 5th bedroom so all children have their own rooms. We did quite well equity wise when we sold our previous property as we did a full refurb and sold it for 100k more than we bought it for a few years earlier. But we moved to a property 150k more expensive so had to increase our mortgage and also increased term back up to 25 years again, was previously 21 years left. It means without overpayment it will be repaid when we are 64 ish. Our monthly payment increased by about £250 but we were still comfortably able to meet it and continue to save. I wouldn't move if money was really tight

Have you had your house valued recently? It's possible that it's gone up in price and you have more equity than you realise. We bought for 145k in 2017 and our house is worth over 200k now....any house we would like to move to has increased by more than that so it doesn't actually help in our case but its worth looking in to.

You get a new job or second job, inherit money or buy a fixer upper. Or wait a long time til yours has grown in value then move.
I feel your pain op 5 of us here and it does feel small, worse since covid for some reason.

We moved to a cheaper area (yep moved schools, but had to weigh everything up and overall it was in their best interests -plus better secondary options) we also used help to buy although not sure that can be used as second time buyers now. Moving last year meant no stamp duty too. I think we'd have really struggled doing it this year post stamp duty and help to buy. But I guess it all depends on the equity in your home, we'd only owned it 3 years, we regretted buying something so small that we outgrew so quickly.

We are currently moving from a £170 flat to a £300 house. We did it by overpaying the mortgage and going from a 8 year remaining term to 31 years.

Why would you regard your salary as fixed just because you're public sector? Are you not expecting to go for promotions?

Generally when people start on the property ladder they're at the beginning of their career. You can fix up or extend or overpay and gain equity that way, then as your career progresses you borrow more and buy bigger.

We overpaid first mortgage. Got a bigger mortgage for bigger house but knew promotions were likely and now we have them we are overpaying on new mortgage. Sorry, realise that isn't a very exciting answer and possibly not even a helpful one if you don't think there is scope for promotions.

Also we didn't renovate the previous house at all (in fact it got covered in pen marks and toddler Hand prints) but we were lucky that it went up a lot in value thanks to the housing market

Unfortunately it's a case of choosing to have a larger family/blending a family. As public sector wages are pretty set but that means they don't change much around the country meaning if you transfer and relocate to a cheaper area you will be better off.

We moved out of London. (This is years ago; now grandparents, but at the time we had pre-school offspring. And before we moved, we bought fixer-uppers. We put in new kitchens and bathrooms while we lived in them, sold and did it again and again. While working. That was three London terraced houses, one after the other, living for less than two years in each, then we had enough cash to buy a detached house in a nice part of the North. Still here, 30 years on. Not sure I recommend it, though...

@Gagagardener

We moved out of London. (This is years ago; now grandparents, but at the time we had pre-school offspring. And before we moved, we bought fixer-uppers. We put in new kitchens and bathrooms while we lived in them, sold and did it again and again. While working. That was three London terraced houses, one after the other, living for less than two years in each, then we had enough cash to buy a detached house in a nice part of the North. Still here, 30 years on. Not sure I recommend it, though...

You wouldn't recommend moving to another part of the country ?

If you work in public sector it is very very hard OP :( But to answer your question, these are the ways it is usually done:

1. Payrises. DH earns 10x what he did when we bought our first house, so we were able to upsize.

1. Inheritance, often from a parent. Obviously this is a sad way to upsize but I know people who have done it this way.

1. Luck. A couple of people I knew bought houses in ‘up and coming’ parts of London and the calue of their houses skyrocketed.

1. Move to cheaper area.

1. Parent downsizes and gives a lot of money from the house sale to the adult child. Obviously you need a pretty generous parent for this one!

I'm not sure why it's difficult to get more money in the public sector, sure if you don't plan on shifting gears at all, but both DH and I have been public sector all our careers and we bring in more than 4 times as much as we did 10 years ago. We've had to move around, put the work in for promotions and change jobs but I wouldn't expect much financial change within the same job, of course it'll stagnate in whatever sector you're in.

Some of it is timing and luck too as well as everything suggested above. We bought a flat in London in 1999 for £95k and sold it for £180k four years later which enables us to move out of London into a 3-bed semi in the Home Counties where houses rarely lose value. 12 years in that house where we spent literally nothing on it and what had been a £295k house sold for £600k. Adding in wage increases and ability to pay more on the mortgage and we bought somewhere for £800k. I don’t know how possible that sort of trajectory is any more though . Certainly there are no lovely London flats for under £100k any more.
So:
Inheritance
Overpaying
Different area
Increasing mortgage
New job

List at the end are your usual options

@userxx
We chose this part of the country to be near my parents and extended family. No, I meant the hard slog of the few years before the last move. Child's first 4 birthdays were all in different houses. Photos tell me how tired we looked, and unkempt: I literally didn’t iron anything in one house. (Fabrics have improved since then.) Always battling builders' dust. Trying to remember dustbin day, working out new routes to work, all that stuff. Good lucknto OP with her growing family!

[quote Gagagardener]@userxx
We chose this part of the country to be near my parents and extended family. No, I meant the hard slog of the few years before the last move. Child's first 4 birthdays were all in different houses. Photos tell me how tired we looked, and unkempt: I literally didn’t iron anything in one house. (Fabrics have improved since then.) Always battling builders' dust. Trying to remember dustbin day, working out new routes to work, all that stuff. Good lucknto OP with her growing family![/quote]
Makes sense, the dust and rubble would seriously get me down. I suppose it was all worth it to finally end up in the North :)

Look at houses that need work or old council houses (often have big gardens). If you’ve been paying off mortgage can extend the term on a larger amount and not pay any more than currently.

Move from house 1 to 2 and 3 to 3 were a case of just going for it and hoping income would rise, which it did. House 3 to 4 we borrowed the extra on interest only and will pay it off when we downsize in about 5 years.