Pay off mortgage in 16 years or double it for a bigger house?

[TheBeesKnee]

This old question again sorry.

We bought a starter house 4 years ago when interest rates were low. We're fixed at 1.69% for another 1.5 years. To be honest I thought we'd move on but then interest rates did what they did.

It's a small mid terrace. Technically 3 bedrooms but the third room is 1.7x1.9m and we can fit a single bed and chest of drawers in there.

We recently had a baby and I'm starting to feel like if we have more than one child this house will be too small for us.

However, because we've been overpaying the mortgage from day dot we're in a position where it'll be paid off in 16 years' time at the current rate.

We're in London so a bigger house would cost twice as much and obviously we'd be dealing with much higher interest rates.

Just looking for some thoughts and perspectives.

What are schools like in your area? Can you get a bigger house and stay in the same place or would you need to move areas?

There’s 2 natural times to move - before Reception applications (before DC1 is 4) and before Secondary applications (before DC1 is 11). At any other time you have to factor in moving schools and disruption.

Or are you considering private school so catchment area not so important but low outgoings to pay for fees is?

Personally, having lived in a very similar situation in a similar house in London, I’d say it’s all fine during primary years - yeah, toys are a pain, the DC might have to share or have unequal rooms, but it’s totally manageable if you want it to be. But upper primary to teenager-dom and more space is more valuable. Depends on your lifestyle and what you prioritise.

Stay put. Baby in the boxroom for now. If you have a second dc, both of them in the bigger second bedroom and use the boxroom for toys.

We moved and got a playroom and the buggers never used it - kids always seem to prefer to play underfoot so unless the playroom is basically a corner of the living room or kitchen it'll be a glorified store room within weeks.

You can always rethink the move when you have two almost teenagers. No need to carve the entire future into stone right now.

Could you move out to London suburbs, if you're not already? We're in zone 6, so still benefit from lowish fares and frequent and late night trains and buses, and DH can be in his Shoreditch office in 40 minutes door to door, but we've got a much bigger house for our money than we would a few miles further in.

This area has seen a huge influx over the last few years of people moving from more central areas but wanting more space when they have families.

I think the missing factor in your post is location. Do you love your current location or will moving not make much of a difference? Can you afford a bigger house in the right location or would you have to compromise?

We have always prioritised a good location over a bigger house, and my goodness we were glad of it when lockdown began.