To buy or to wait??

[OutsideEveryday]

We are renting a 2 bed flat, £850 a month. Myself, DP and 1 yo baby. Currently have £30k in savings for a house deposit, and my dad is very kindly offering to match whatever we save, but can only give us the money when he gets his pension next July. We know we’d like at least one more possibly 2 kids in the near future, so, my question is do we…

Option 1 - wait until next July when we have the extra money from my dad and therefore a bigger deposit. Cons - we would be paying 850 a month rent for someone else’s mortgage rather than into our own.

Option 2 - buy now to get ourselves on the property ladder, then we can move and hopefully upgrade with a larger deposit from the house sale in a few years time. Cons - wouldn’t have as big a deposit now so monthly repayments would likely be higher (although still doable for us).

Option 3 - buy now and buy our ‘forever’ home, which would mean higher repayments and a lower deposit but we wouldn’t need to move (slight worry re negative equity if we were to go with option 2 and move after only a couple of years?)

Or any other options people can think of? I’ve been trying to educate myself about mortgages but I’ll hold my hands up, I’m definitely no expert so any insight would be fab. Ty

Don't buy now thinking you can upgrade in a year. The whole buying and selling is stressful and expensive.
My suggestion- an option 4 - would be buy now something that needs work to make into a longterm/forever home, but is livable in, and then when your dad's money arrives you can do the work.

Option 3 and use Dad's money to pay down some of the mortgage?

You need to do the maths on mortgage payments given the increased interest rates. Look at 2 year and 5 year and longer mortgages.

What can you afford to pay on a mortgage based on income and outgoings. And consider whether you would cope if you over stretched and rates go up again.

Think about starting to look at actual houses to get a feel of what you can get for your money.

Think about investment of time and energy if you were to buy something that needs work

Think about stamp duty which adds thousands to the purchase price.

What is your forever home OP? What can you afford?
A good sized 3 bed can fit 3 kids perfectly fine.
I wouldn't advise buying a massive house straightaway because all sorts could happen. You might struggle to conceive, job losses etc etc and a huge mortgage will be a millstone.

Wait until next July! Save a bit more then hopefully your Dad will match a larger amount. House prices aren’t likely to rise much in the next year & it’s expensive to move house especially if the house hasn’t appreciated much in value to help pay for all the costs.

I would go with three if you can afford it. Moving is expensive, so moving in a short space of time doesn't make sense. Can you still afford it if anything goes wrong with your dad's offer? Eg he needs to work longer, has medical issues?

Good option 4. I would add that buy something that needs work AND that you could extend as and when funds allow thereby future proofing your house. DO NOT UNDERESTIMATE THE STRESS AND EXPENSE OF SELLING AND BUYING!!
So definitely not option 2.
i woukd go with option 1 or 4.
July next year is not that far ahead and interest rates may well be a bit lower. Keep an eye on the market and if a good house comes up (option 4) go for it.