Big house or pension?

[WhichHoose]

If you had a budget that could buy you a really nice house, would you go for a nice house or a more modest home (that still met your needs, but only just) and put the rest into your pension?

My pension pot is about £1k due to extended ill health and I'm 36 so while I really want a nice house, I'm scared of getting used to the space/comfort then having to leave it when I retire to fund my retirement!

My budget is £375k (North of England) and the houses that would just about meet my needs are £170k with repayments of around £300 a month with the deposit I have (£130k).

WWYD?

Opposite actually. The market has been stagnant and prices in reverse for a year or so due to mortgage spikes quickly Which scared people off, but as they're coming down a bit and stabilising it's just started to pick up, we're expecting 5-10% growth this year. Demand massively outstrips supply usually but not so much now, meaning it's a buyers market and you can chip prices. and mortgages are becoming more affordable. Rates will never go back to where they were.

I've worked in the industry 15yrs. If you're hoping for a price crash, it's not going to happen. Even in 2008 they only dropped 15-20% depending on area.

I'd be thinking smaller house and then investment property eg a flat I could put on air bnb for a pension.
Or a house with a downstairs room you could rent or air bnb or stick a shepherds hut in or something.

5-10% growth. You seem to be a very positive outlier. I'm a negative outlier at -10% this year. Others here think -5%.

If you work in the industry then I'm surprised you seem to be so far out. Time will tell. But if prices do fall then that will be positive for you as more transactions will mean more fees.

There are two components required for demand. The want to buy plus the ability to buy. At these prices and these rates the ability to buy is severely hampered.

For the OP to predicate her life choices on
-- house price rises
-- significant pension fund growth
is SILLY

Get housing security
Keep enough money NOT locked up in a pension to avoid ever having significant unsecured debt

Buy a house that you love to live in that has flexibility
stay healthy so you can work for as long as you wish

@Talkinpeace yes because long term good health is a better bet than having a pension? WTAF

The OP will get a state pension - currently £1000 a month
if much of that goes on rent due to housing insecurity
they will HAVE to keep working into old age.

To get from a £2000 pension pot to a £1000 a month pension income
while paying rent / mortgage has not been done by ANYBODY yet
(as the stakeholder rules are only 15 years old)

@Talkinpeace but that’s an argument for the smaller house since they could become mortgage free quicker. So what is your point, just that no one should ever bother paying into a pension? They should just avoid all illnesses like cancer by “staying healthy so you can work for as long as you wish”.

I pay into a SIPP pension
BUT
I made sure I had housing security first.

To get from a £2000 pot to a £300,000 pot is an insane ask.
DB pensions only exist in the public sector.
Stakeholder pensions are chicken feed.

Housing costs are insane and most people will (rightly) put housing security before salary sacrifice
especially with 9% salary deduction for Student loans on top

I personally would do pension, but not overdo it.

My parents lived most of their life in an ex council house. They then sold it for retirement and upsized to a semi rural farm. They live the life of riley, barely spend much money but live in beautiful idyllic countryside, dog walks, beaches, cabin breaks. City and town life are too hectic for them. Now they do all the country life stuff. They travelled a lot more abroad in their 60s. Now they Don't want to leave the dog. They do lots of home growing, cooking, community activities.

I would always say travel when you are young. You have no idea what is round the corner health wise.

Sorry to dredge up this thread.
OP, you were saying that the teachers pension (ur husbands) isnt very good any more and has gone bonkers.
Can you explain? What has changed? As far as I was aware, it's an excellent scheme.

Pension.
I have paid into my NHS pension from age 22. Not always worked full time but my pension pot and savings amount to about 1million.
I was astonished when I had it valued a couple of years ago ( the big rise in inflation has been my friend at a time when I was close to retirement).
So after a run in with breast cancer a couple of years ago I took the plunge and retired at 59.
I work one day a week and enjoy 6day weekends.
I will get my state pension at 67 and I have a small private pension I dump money into to save on tax.
In three years I will probably retire fully and use my private pension as a draw down until I reach 67.
DH and I are very comfortable, he has a small draw down that he is paid up to zero tax limit. Our mortgage is minuscule and our house is rural in a desirable school catchment area so more valuable than those just up the road.
We chose affordable in a good catchment area rather than big in less desirable area. We never made the next step up so are not having to downsize, we also didn’t have the planned size of family, had to stop at one.
We are in a privileged position but the security and ability to retire early ( both due to health reasons) has taken a lot of stress away.
It was well worth the income sacrifice. We have lived a good life within our means.
We have spent a fair bit of money on improvements that has lowered fuel bills. Currently making the garden low maintenance so that we can do a bit of travelling in the future and not return to a jungle.
The biggest benefit of a smaller house is the overall running costs. All bills are relative, it’s not just the mortgage that is more manageable.