Is this an utterly bonkers idea?

[Isanyonereallyanonymous]

I bought my first house (standard, modern 2 bed terrace) 2 and a half years ago, with a 5 year mortgage on it.
Unfortunately last year between my car and my animals having issues, I wiped out my savings and incurred a chunk of credit card debt, which is stressing me out. It will take me about 8 years to pay off :( I am already working 2 jobs.
A property has come up in town which is an older terrace but recently renovated and just my taste. It also has a layout that I would prefer over my current (very standard) house but would probably not be very desirable to most people.
It is however priced at about £15k cheaper than what I paid for my house (which I think should be a similar value now as to when I bought it)
My mortgage can be ported over and I could use the difference to pay my credit card off which would help massively.
My house isn’t on the market and I haven’t actually viewed the other house so it may all be a bit academic, but is it a mad idea to even consider it?

No, it’s not a crazy idea. Anything that minimises your debt, or eliminates it, is a good idea. But you also need to have a hard look at your lifestyle - you really shouldn’t have to fall into debt for your pets or your car. Focus on building your savings. Stop all discretionary spending - no new clothes, takeaways, holidays, coffee shops, nights out until you’ve built up savings. Otherwise, this will keep on happening and the interest will eat up all your future savings.

Have you worked out moving costs? That would potentially eat up a lot of the 15k.

15k would be eaten up by fees

Agreed-
solicitors fees, searches, surveys ,actual moving costs, any work you need to do on your own house ........

£15k would be eaten up .

It can work but you might need a bigger difference than 15K, just because of the costs of moving - legal fees, stamp duty, movers etc could wipe out most of yur 15K depending on the house values involved.

x-posted with everyone!

It cost me about £2-3k in fees when I bought initially, including relocating from London to 4 hours away. Surely moving from one side of town to another won’t be dissimilar?
I was expecting to split the £15k £5k for costs and £10k for clearing debt/re-starting the savings pot.

There are no takeaways, luxuries etc have all been cut. Majority of the debt was buying a new car after having spent lots on trying to repair the old one.
I have a commitment coming up in July that I can’t change which is currently taking spare funds, after that I will have a bit more income to put towards paying off the debt. I really really hate the situation I’m in and am doing everything I can to get out of it.

Were you a first time buye? There are more solicitor fees when selling and buyer. Stamp duty potentially higher when you aren't a first time buyer. And estate agent fees for selling.

Ah I hadn’t considered that. Yes, I was a first time buyer last time.
Fortunately the property values are very low and the stamp duty would be a very nominal amount but I definitley hadn’t considered solicitors fees for selling 🤦‍♀️ Would anyone have an idea of what they might be roughly?

We have sold at £360k and our solicitors is £13k. Remember stamp duty goes up 1st April

Crikey. Is that a typo?!

We paid about £3.5k for solicitors to buy and sell a year and a half ago (both properties higher value)...(plus 1% of the sales price on agent fees).

Don't forget your utility bills may be much higher in an older property unless it well insulated. Check its EPC vs your current home.

No sadly not a typo but that includes the £9500 stamp duty

Hi OP, we have just sold and bought on a house a short distance from our original property as you’re describing. The fees associated with this were:

• 1.2% estate agent fees on sale of 1st home (inc VAT)
• £1.2k home survey fees
• £2,000 moving fees (5 bed house in Zone 2 London which will inflate costs I should think)
• £1,300 packing service (which included dismantling furniture, putting it back again, all white goods reinstalled and all packing materials provided)
• Legal fees for SALE: £3,200
• Legal fees for PURCHASE (excluding stamp duty): £4,000
• Stamp Duty

Obviously doing your own packing will save £££, and a highstreet / online conveyancer would be much cheaper than our legal fees (but don’t choose the cheapest as you do get what you pay for…).

There’s also the little costs that build up… more on food / takeaway for the first month as you settle in and don’t have time to cook, for instance. Or getting a handyman round to the new house to get everything up and ready. I’d say that was another £1k for us.

You wouldn’t gain anything close to 15k between estate agent fees, solicitors for buying and selling, mortgage fees, surveys etc.

I’m buying and selling right now, you’re going to pay around 1% + VAT to the estate agent, anywhere between 1,500-2,500 for the solicitor fees each way buying and selling, then the valuation fee, surveys, possibly a fee for porting the mortgage depending on your lender, removals or a van, stamp duty. Even if your stamp duty is minimal you are probably looking at close to 8k.

So you bought at peak? How is your house worth the same now in the dip?

Moving costs? Stamp duty? Conveyance?

In house buying 15k is nothing... You could expect to lose 15k on a reasonable offer on a £150k house.

Just to say it's quite tricky to predict the final total on solicitors fees because there's quite a lot of things that will make a difference. Assuming you are on a newbuild estate but in a freehold house, my guess would be there may be some kind of communal areas with a management charge - which means you'll have to add a few hundred on to get the "management pack" (yes, total scam). It seems like nowadays there is inevitably a bunch of things that buyers solicitors will demand indemnities on and each one of those seems to be in the £100-300 region.

My original quote for "basic fees" was £1.1k for selling and £950 for buying, but by the time they've added on all kinds of bank fees, mortgage fees, land registry fees etc (plus VAT) the quote is approx £4k for solicitors, but I know it'll be more than that when they finally add all the indemnities on.

Also consider that you need contingency in case the buyers have demands that need sorting in order to keep the sale moving. In my case I ended up having to go halves on an asbestos survey, had to agree to get a gas certificate. Hopefully if by "modern" you mean your place is newbuild, there should be relatively little of this kind of thing, or survey issues, but not many buyers nowadays just quietly buy the house without a million little quibbles!

It's really not worth the upheaval, the costs etc. older hour may have unforeseen work that needs doing etc, at least you know where you are with your present house.
Can you take in a lodger or something to get back in the black?

That's a huge upheaval to gain maybe 5k if you're lucky. You'd have to bank on nothing going wrong in the whole process and if the boiler went in the new house within the first year it would be for nothing.

Your mortgage may be portable, but your lender will re-do affordability checks before they allow it to proceed. Are you sure you will pass them right now? - part of affordability is based on your financial resilience.

I agree with others. The costs of a sale/purchase mount up and if it is an older property it is more likely that some sort of anomalies will be found that need pursuing by the solicitor - also with an older property a survey makes sense so you know what you are taking on. Even if you use a cheap online sales option (like Purple Bricks) you are looking at a lot of money on estate agent's fees - although you can try knocking them down - I did. Told them I would only use them if fee was 1% - they went along with it to get the business.

When you are in debt it is tempting to grasp at straws but you need to be sure it will achieve what you want to achieve - in your situation I doubt whether it will.