Buying a dream home is often high on most people’s bucket lists, but if we can’t afford a 12 bedroom mansion with a swimming pool, gym, observatory and 100 acres of land, then we may at least consider a bigger and better house at some point in our lives. But it’s not always the best decision so here are eight things to consider when upsizing.
Can you afford it?
You might be tempted, if you’ve built up a decent equity in your current house and maybe saved up a decent (second) deposit to max it out and take on a big mortgage on a big home. The introduction of the Mortgage Market Review in 2014 could take the decision out of your hands, as lenders have cracked down on incomings and outgoings. Don’t forget estate agents’ fees, stamp duty (find out more in this Money Advice Service guide), relocation and all the other initial costs as well. There are ways to avoid paying any fee’s, using www.theipropertycompany.com you can buy and sell property without having to pay the costly fee’s often involved with moving. An option like this might be something to consider and can help save you money, leaving you more money to spend doing up your new home.
Have you thought of those extra costs?
Even if you can stretch to pay for the mortgage every month, there are many other bills that will either increase or arrive from nowhere. More rooms means more heating and electricity, and possibly a larger council tax bill if the new home is in a higher tax band. It could also mean you need to spend more money on security, transport and other costs.
It’s tempting to go as big as possible but ask yourself – do you really need a study, or a bigger garden, or a breakfast room? How much parking does your household really need? Are you planning more children, or does one of your children intend to move out soon? All of these factors could alter the price of your intended home by thousands of pounds.
Is there anything wrong with your current home?
If you’re moving purely for no other reason than a lust for a bigger house to show off, with few practical benefits, then it might be time to take a step back and assess whether you’re making the right decision. A crippling mortgage purely for the sake of your ego and a bigger bathroom and kitchen could haunt you forever.
Do you have time to care of a bigger home?
Bigger homes need more time. Vacuuming and re-decorating are more laborious tasks, mowing a bigger lawn can be a real chore, and if you think children can spread mess in a small room then wait until you give them one twice the size. You may be able to afford a cleaner, but that is yet another regular outgoing.
Can you time it correctly?
There are several things worse than paying a mortgage; being in-between homes and living out of a suitcase, and spending hundreds of pounds on storage for a protracted period, are just two. Theoretically, as this Guardian mortgage expert points out, you could end up possessing two mortgages at once – that could be an expensive few months.
How much will you need to spend on furniture?
You might have a treasure trove of ornate wardrobes and sedan chairs in storage or a shed, just waiting to take pride of place in your glamorous new pad. If not, you face the choice of a new but empty, mausoleum-type building, or shelling out hundreds or thousands of pounds on new items.
What can you do with a bigger home?
Yes, it will probably be more expensive – but you might be able to use it to pay back the difference. For example, a study room could lead to increased productivity, and an extra room could be lodged out or allow relatives to stay for a period of time (and help with bills). Car parking spaces can be rented out – and you’ll probably have a lot more space to entertain friends.