Downsize

HEADRAT

HEADRAT

HEADRAT

Soldato
Joined
18 Oct 2002
Posts
21,546
Location
Cambridge, UK
Hi,

Has anybody thought about doing this, I currently live in a 4 bed house which is worth approx 250K, since splitting up with the other half I really don't need such a big house. I was just looking at a small 3 bed house for 139K which would mean I would need a mortgage of < 60K :eek: and it would be OK for me, I'm pretty tempted to be honest!

HEADRAT
 
Different situation, but my parents did that a few years ago and used the equity to buy a property abroad.

But, as in your case you're only doing it to decrease your mortgage - it could work out well. And if there's no reason to have such a sized house as your current, and you'd be happy with something smaller; go for it I say :p
 
It depends entirely on what you plan to with the extra purchasing power.

Although you will not have any extra money, you will effectively have a larger capacity for debt, which can be useful for squirreling away funds (eg. buying property now, inorder to finance your retirement).

I suppose you could consider buy-to-let - sell the big house, buy two smaller.
 
3 bed houses in cambridge for 139K :eek:

meh, just saw the mortgage bit, sub £200K still quite good i guess.
 
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Why not get a two bed house and a porche instead. :)

Do it. The good lady and I don't have any brats and so we still live in our little two bed house that we bought 15 years ago. Don't see the need for anything bigger because it would just cost loads more money for not much benefit.

BTW, I only have a 15 grand mortgage which will be zero in about 5 years. Woohoo. :)
 
If you can afford to stay in the bigger house I'd do so because you'll get more money as it increases in value. It's understandably tempting to downsize though. What you could do if you're a bit of a DIYer and have some time on your hands, is to buy something a bit crap and do it up with the spare cash you'll have :) There's several options really, just don't rush into anything.
 
WS_TailGunner said:
buy the small house, rent the big one, the rent pays for the small one....you end up minted. luvverly!
Click to expand...

Yeah problem is I'm a 40% tax payer and it all get very complicated!

HEADRAT
 
WS_TailGunner said:
ooo! i like him- he's sneaky :)

TG
Click to expand...
Better still - run the BTL through a Ltd company, and work as a contractor through the same company.

It's IR35 proof and you can pass almost every cost off as expenses.
 
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