Using equity for renovations on next property

[UndertheMapleTree]

I honestly feel I shouldn't be allowed to sell a property if I don't understand how this works, but please explain to me as if I'm an idiot...

We're selling our flat at the moment. Last time we moved we used all of the equity we had built up in our first flat as a deposit for our new place. But is it possible that when we sell we can use some of the equity in our current place to fund some new renovations in the next?

We would have enough still to cover the deposit and get a decent(ish) rate if we kept back £30-40k for a new bathroom and kitchen. But can you withdraw equity like that when you're remortgaging? When I tried to look this up I just got sites talking about equity release and remortgaging a property you were staying in.

I’m not sure I understand the question exactly so let me know if I have got this wrong. If your current flat sells for 100k and you have 50k mortgage, and your new house is worth 150k. Technically you only need a mortgage for 100k and you have 50k in equity. There is nothing to stop you getting a mortgage for 120k for example and keeping some of your potential deposit back to spend on the house. This would mean your mortgage costs more overall. Don’t forget the amount that can be eaten up by fees, stamp duty, moving etc.

Ignore the concept of equity and remortgaging etc. Instead just work out what's left over once your house is sold and mortgage paid off. i.e. Sell for 300, pay off 200k mortgage, pay £10k on moving fees. You have £90k money left - not equity, not deposit, it's just money.
You can use that money any way you chose. You could do a bit for fees and the rest on a deposit, or if you are downsizing to a mobile home a bit on fees, a bit to buy your mobile home and the rest on a massive cocaine habit. It's your money, do what you like.

Think of it the same as if you were remortgaging your current house and wanting to release equity to fund renovations. Just increase the amount you want to borrow so you get the money back as cash. Say you are currently living in a £100K house and you have £75K in equity and £25K is mortgaged. If you move to another £100K house and apply to the bank to borrow £50K, you will then have £50K in equity, a £50K mortgage and £25K in the bank for your renovations. It's quite common to release some money to pay your SDLT - we are doing that and taking a bit extra besides for renos.

Also, just to add that it can be hard to find the right terminology to use in search engines. Give an AI chatbot like ChatGPT a go. Just describe what you are aiming to achieve in common parlance e.g. I'm moving house. My current house is worth x, I have a mortgage of x and x amount of equity. The new house costs x and I want to release £x to fund a renovation. How can I achieve this?

Oh this is all enormously helpful thank you. ^
^
And thank you @Tupster for laying it out very clearly about not thinking about it as equity. At the moment once we pay off the mortgage on our flat we should hopefully have around £200k 'left' and what we would like to do if we we were to offer on one particular project is to put £45k aside for work on that (and for the massive cocaine binge of course )