Are we being stupid? Renovation spend

[LittleMilla]

Final costs now in for knocking thru kitchen diner, plus other work to install a utility room and pantry.

All in its going to be £33k. We know the top whack value for our property (only bought it last summer) and this will push us £10k over what we could recoup.

This is the tricky bit. It's our 5-10 year home and we've got no plans to move. We could prob do it all for £10k cheaper if we didn't go for all the nicities - stone floor underfloor heating, range etc. but we're doing this to LIVE in not sell.

Are we being stupid?

It's not a lot to spend - if you can afford it.

You have very little equity in your property - less than 5%.

Interest rates are unlikely to go down in the next 5-10 years.

If you expect household income to increase quite a bit over next 5-10 yrs I.e. because of anticipated salary increases above rate of inflation, then I'd say go ahead and enjoy it whilst you're there.

What you don't want to happen though is for house prices to fall whilst interest rates rise because, with only 5% equity in the property, you will be particularly vulnerable to getting trapped in negative equity.

It sounds fair. I renovate houses for a living ad would be happy with that

Agree with Zavi in that I may come across as very boring/sensible/conservative.

However Zavi said you don't have much equity but I don't think you mentioned how big a loan is outstanding?

If you've loads of equity then I might consider it, or if you are expecting decreased costs going forward (unlikely with a second child), or are expecting major payrises, or are awash with cash.

Am assuming your cash/equity position isn't great given you mention borrowing off family. If that's the case then (to me) it looks a very luxurious set of changes to borrow for. But then, plenty of people take out loans for flash cars etc

I know this is a terribly dull point, but the problem with a stone floor is that when you drop things on it they break.

That's everything from wine glasses at parties to iPhones and iPads.

Then the shards of glass get into the rough bits of stone and the grouting...

Children learning to walk bang their heads

LittleMilla, I don't blame you if you now have your fingers in your ears

So I sent quote to another builder (who our go to man is currently working for). He's said it's v high and is coming over later today to quote just to make sure he could actually do it for much less. As in £10k less Although said upfront he couldn't take on any more work for 2 months. I'm due in July so haven't got forever to make a decision.

Anyway, it's 4am and I'm awake stressing about all this! We'd wanted to do all this for £20k at first. That would keep us in check for house price, mean we borrow min from family and wouldn't feel anxious. Builder coming over on mon to discuss as DH is away. I'm just going to stand firm and say that it's got silly. I don't believe us wanting some naice things is to blame too much. I think we have chosen an exp builder and allowed him to add £££. If it comes to it we can pay him £500 for his time (we've been working together for months!) and go our separate ways.

Re equity, we had an ok deposit. Whilst this is our first property, DH and I have been saving for a longtime (he's an accountant by trade) and he's good with money. Ditto why we'd borrow from family and not bank. Because we can, not cause we can't get bank money iykwim.

Thanks all for replies.

Just had another builder over for a second opinion. He's said that in places it's expensive but in others he's concerned that it's not enough! All in he feels that we're getting a fair amount for the £28k quoted. He's also said we should re-think UFH though as his feeling is that with decent insulation we could do without it.

His biggest concern is with regard to the lack of detail in our quote. He's said that we must push for much more - are ceilings coming down, for example? Is the larder being damp proofed (he has said that you can see rising damp out there) etc etc. He's said that as it stands there's just not enough detail in there for a £28k job.

God, I feel so bloody stupid.

Get an architect in o scope th job for you ,and he will gt quotes on your behalf. Ours also project managed it for us, saved us money in the long run as he also set up builders contacts etc. I really would consider doing a 4th bedroom if you can stretch tout as you will have loads of disruption so you may as well get it out of the .way.