Financial difficulty do I act now or wait it out?

[SlayoTolstoy]

Found out on Friday I am being made redundant from a job I have been in for 5 years and is generally a dying industry. I'm unlikely to ever earn as much again, meaning my mortgage affordability will go something from £500k to £300k.

I bought my first house 3 years ago using money from my divorce settlement and a mortgage for £900k. I am now worried about the longer term struggle affording the mortgage on a reduced income. I am 37, single but dating and no children but I would one day like some.

I live in a tiny cottage style house in Chiswick. I'm keen to hold onto it, but wondering whether it is better to sell now before I'm under pressure? My likely new job and salary won't be enough to cover mortgage and bills. My mortgage is £2.8k, and my future salary is likely to be £3.5k per month.

Sorry about your redundancy, but I would sell it.

You couldn’t live on those figures, could you.

And not to be the voice of doom, but if you want kids then biology says you need to be starting yesterday (££££ on IVF here, voice of bitter experience).

Find a way to downsize and make your current equity work for future you.

You need to do something now rather than wait and ruin your credit score

I also would move now

Sorry to hear about your redundancy. Sadly, you need to sell your home as you can't possibly afford it on that salary.

Being made redundant is very difficult, sorry to hear that. You should take a risk-averse approach now, downsize and tighten up on your finances.

Is there likely to be a significant inheritance? That is the only straw, and it is a straw.

You describe the house as tiny. If your future involves moving in with a partner and a child you may have to sacrifice character for space. But I'm sure post divorce this house has already served it's comforting purpose so maybe it's time to move on.

Are you getting a redundancy payout? If so, is it enough to cover the mortgage for a while?

Have you spoken to recruiters about what is out there re: dying industry?

Could you take in a lodger?

Is your mortgage 900k??? Or you have 400k equity and a 500k mortgage?

How tiny? 900k in zone 5 would get you a 3 or 4 bed semi

could / would you look at a lodger?
This could give you an extra 1k or so pm

Inital thoughts are sell... you could get something decent for 5-600k elsewhere in london

Sorry to hear. Unless you consider taking in a lodger which I appreciate is not for everyone, I would sell and downsize financially.

Sounds like a tough situation. Do you have a good savings buffer to see you through whilst you market the property ? I'm sure you can't manage where you are taking that kind of salary decrease in the longer term. Sorry for what must be a pretty stressful situation.

What is your redundancy package like? Remember the bulk of it is likely to be tax free, plus if you have a period of unemployment and then move onto a lower salary, the tax man is likely to have to pay you back some of the tax they took from April to sept this year.

That could help tide you over for a bit.

Depending on your age, savings, pension pot etc you may have to sell your house to afford to live. However, you don't know until you know all the facts and figures.

Also, consider when you need to remortgage (regardless of when you're selling or not) will mortgage rates likely to have changed (potentially lowered?) by then?

House moves are expensive, so do explore all other avenues first - selling old jewellery, downgrading car etc.

Sell it and make a nice buffer to tide you over. Do you need to live in London for your next job?

I am getting a payout of £70k and yes I have already listed for a lodger, so fingers crossed.

Most of the jobs in my field have now moved to the EU unfortunately

400k equity and 500k mortgage, probably slightly less by now.

The issue is I can't move until I get a new job due to needing a mortgage. Unless I sell, and get something for 350k.

I have savings of 20k and will get a 70k gross payout

I'd get proper career coaching advice. Many new high paid jobs are springing up in new areas and those with transferable skills will get them.

You're admitting defeat quick quickly!

Hello Chiswick local! I’m sort of in a similar boat. If you can, I’d sell now while there’s a brief pickup in the market.

If you want to stay sort of local, Northfields (Ealing- not cheap but definitely cheaper than Chiswick) and Hanwell are worth looking at.

You're single, 37, have a big redundancy payout on the way, and loads of equity.

To me, that is a thrilling set of circumstances. I would be looking at a complete change—a move to another part of the country, or abroad (can you follow your industry to the EU?), new career, travel.

I would keep the house.

As long as you can pay the mortgage and the council tax and food, you'll survive.

I'd relocate.
Buy a property for 350 k and live mortgage-free.

That covers your mortgage for a couple of years.
buys you a little time.

This is actually a GREAT point.

would you consider something like letting your house for a couple of years and going to Australia or something???

Keep the house and rent it, and go for a job in the EU if you fancy a new adventure? You could always move back in a couple of years if it doesn’t work out!

I would also consider a lodger. I had one twenty years ago and we're still great friends today .