House Buying

[Flimingo]

I am having a confusion.

Should I buy a 300K 4 bed semi-detached house as cash(something I can buy as cash)

OR

To buy a 450k 4 bed detached house on 50% mortgage?(off course this is a bigger 1700sq ft house)

it’s about choosing between a cash affordable house or tie up in years long mortgage.

please help

If everything is equal, eg location, condition of home etc, then I’d go for the semi detached.

Personally I would go for the larger, detached house but to give a useful answer some more information is required.
How old are you, are you working, when do you intend to stop/retire, do you have savings & pension, will you have savings & pension when you stop, how many will be living in the house, are both houses equally convenient for schools/work/family etc?
So much information is missing from your OP.

48 years old.
will retire 2044.
5 people will live in the house.Eldest son just started uni.
i will have saving/ pension at retirement.
both houses are compatible but 450 k is bigger house.

If you can make it work take the smaller property :

1. You have more disposable income
2. You are less exposed to falls in value if property prices reduce
3. You have more flexibility to choose how to change your work should you need to
4. You completely avoid paying a large amount of interest
5. You can probably save a little an make interest
6. You have more flexibility if you should need to move
7. You can make improved contributions to your pension
8. Your smaller house will likley be cheaper to run and maintain
9. You can do more to help your children through uni if they want to go and hopefully they can start the world of work in a better position as a result.

10. If you or a family member develop an illness it should be easier to manage.

To be honest I could go on and give you a 100 more reasons not to buy bigger than you actually need - but the most important ones all hinge around the tremendous freedoms of owning outright v indebted living realities. Your about to turn 50 too, give yourself a release from the treadmill. Being mortgage free is empowering on so many levels.

Is there a need for the extra space or is it a case of it's nice to have? If you need or will benefit from it then great, if not then it's wasted money.

I chose a smaller house because it suited my life more than the bigger house even though they were exactly the same price. The lower council tax and water rates played a part in my choice but the smaller house had a floor plan that I liked, would be easier to heat which is an issue in my neck of the woods and had a small back garden which would be easier to maintain.

I for one would love to be mortgage free. The life I could have if I had the extra cash each month would heavily weigh my decision.

Mortgage free for all the reasons @DrySherry gave, especially no.9. Uni is very expensive!

Take the semi and relax. The children will soon move out and you'll be rattling round heating up half a house you never use. Id opt for mortgage free every time.

Mortgage free 100%

Less cleaning too

Mortgage free for me to! I got caught in negative equity twice 1989 and 2008 crash..we had already moved down sized in 1999,when 2 DKs had got their own places..

Detached, less neighbours to worry about.
Make the choice based on which you prefer, you can always change your mind. It's not like both houses won't need financial input, even if one is mortgage free.

You can always change your mind but it is very expensive buying houses! You don't really want to be paying stamp duty twice. Stamp duty on the bigger house alone is £12,500 compared to £5000 on the smaller house, plus estate agents fees, solicitors fees, removals etc.

Mortgage free without a shadow of doubt . Just how uncertain the world is becoming I wouldn’t want to take out a mortgage unless I really had to right now and you don’t !

Why spend a lot of money on interest charges if you don’t need too . Enjoy having more money in your pocket to keep as a cushion .

We have managed to be mortgage free just as DD started uni. This has meant she has not needed a maintenance loan, as the money we were paying for the mortgage now pays her rent, living expenses etc (she also has a part time job). This has saved her around £30000 in student loans.
We bought the smaller semi detached property in order to do this. I wouldn’t have compromised on area though, but you don’t mention that so am assuming both are in the same or comparable areas.
I am hoping to retire a little earlier once we are not paying for DD. It is a nice position to be in and I am aware of how lucky we are (we also chose to only have one child so we could afford to make these choices but I’m aware that is a different and very personal decision).

The semi

Agree with above poster re not having neighbours to worry about, but from my experience it would put anyone off having neighbours.

It depends on needs and it must be appealing to be mortgage free especially with everything going up. You have to go with what your gut is telling you and what house is pulling you the most.

I had this dilemma 5 years ago though it’s just me. To buy a tiny detached I could afford outright at the age of 48 funnily enough also or a larger detached property with a 85k mortgage. I was seduced by the much more massive home which is fine in terms of budget as I figured I’d have it paid off by my mid 50s if I overpaid regularly and then paid off the balance with my savings which would have built up agin from FT work. I’ve really enjoyed the larger rooms as it’s just so lovely having such a spacious interior. However, the heating bills and maintenance costs, large gardens back and front have really taken the shine off it after a few years tbh. Although it’s a beautiful home and I get many compliments, deep down I know I made the wrong choice. I live in a really nice area and the much smaller detached properties I realise that I turned my nose at I later realised are in very short supply and any that do come up now are much more expensive than previously. So now I plan to sell in a few years and could really kick myself as this purchase was meant to be my forever home but I ballsed it up. I should add I was searching during lockdown as I was experiencing DV so had to get out asap and just so wasn’t quite thinking straight but there we are.

Moral of my story I guess is ‘just because you can, doesn’t mean you should’. If the smaller property is enough to adequately contain your family then I’d go for that unless you expect maybe immediate family to be together for many years in which case maybe the larger one would be more beneficial for everyone. You could always downsize at a later date and release the equity to yourself and buy another outright. Good luck!

I will be the lone voice in support of the other direction. We went from mortgage free to a much larger detached house with a much bigger mortgage than ever. Teen dc. My thoughts are I am nowhere near retirement age. My kids may need somewhere to live in their 20's. We've retained savings for Uni costs. I want to live my life. Have friends and family over, be the hostess and fill my home with love and people. If the world is going to shit and I've got to keep working till I'm nearly 70 then I'm bloody well going to do it in comfort and having fun. We did ensure we had plenty of buffer to protect in case of job loses, mortgage rate rises etc.

I’d go for the bigger detached house with a mortgage. Neighbours can cause no end of misery if they’re inconsiderate. We’re lucky at the moment, but know all to well it is just that - luck. I always say go for the least number of walls attached to someone else as you can afford, and the most amount of space between the properties.

As someone who works in mortgages we are coming across a lot of people who are coming up to retirement age and still have large mortgages to pay off, it causes a huge amount of stress and worry. £150,000 is a large mortgage to take on at 50.

I would personally go for the mortgage free option and put the money you are saving on a mortgage towards deposits for your kids to buy a home when they are ready. They will thank you for it in the future

I would definitely go for the detached house and don’t understand anyone living joined to anyone else if they don’t need to do so.

💯

I’d go cash. Mortgage freedom.

Yes I know it costs money to change your mind. But 'nothing' is certain other than death and taxes! It's better to be aware that your choice can be changed, and so make a choice you hope is based on 'best outcome'. If a semi and no mortgage makes you happier than a detached with a mortgage then chose the former.

In your position I’d go for mortgage-free on the main residence and consider whether you want to get a mortgage to get a property in your son’s university town (obviously doing the sums to compare with other expenses).