That old saying ‘bigger is better’ is not necessarily the case when it comes to property. Too often, we are attracted to the promise of a roomy abode, without considering the long-term stress of heightened mortgage repayments and upkeep. Upsizing can be a necessary transition, but before committing to a larger pad, it is crucial to consider your financial and familial circumstances. Here are eight questions to ask yourself before upsizing your home.
1. Is this necessary?
It is important to assess your motivations for investing in a bigger home. Is your family expanding? Do you need more workspace? Or, are you simply pursuing a dream of living in a large, lux pad? Determining whether a shift to a bigger place is necessary to your current circumstances or future plans, will help clarify whether it is a healthy investment.
2. How many rooms do I require?
Buying a house is a long-term commitment. So consider your ten-year plan when upsizing your home. How many kids do you want to have? What will their sleeping arrangements look like? Will you host regular guests? Do you need spaces for entertaining or a home office? Do you have an ageing relative who is also likely to move in? It is important to be tactical about the functionality of a space. It is all too easy to invest in a larger footprint that is totally incompatible with your family’s needs.
3. How much can I borrow?
Do not rely on mortgage calculators to determine your borrowing capacity. It is crucial to arrange your finances and receive pre-approval for a loan, before committing to a property. Visit a lender and determine how much you are able to borrow for your new abode.
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4. Can I afford repayments?
What do your monthly finances currently look like? How might this change in the future, as your family (potentially) transitions to a single-income household with more dependents? It is important to carefully assess your monthly spending and also determine whether you can afford the higher monthly repayments.
5. Can I cope with additional utility expenses?
Inevitably, your utility bills will be higher than those in your previous home. Maintenance costs may also be elevated. These are factors to consider when assessing the financial viability of upsizing your home.
6. Is it more sensible to renovate?
Get some quotes and also do your research. If you have the space and permission, adding an extension onto your old home, or building up, might cost less than investing in a larger home. It is, however, advisable to consider the additional cost of renting while the renovations are undertaken.
7. What about the other costs and responsibilities of upsizing?
Some of the hidden costs of upsizing include a higher stamp-duty, the potential need to engage Lender’s Mortgage Insurance, conveyancing fees as well as moving costs. These should all be factored in as budgetary concerns. A larger house also necessitates more upkeep. You might have a larger backyard, more rooms to fill and clean, more gutters to service. Do you have the time as well as the facility to manage a larger property?
8. What is my resale potential?
When thinking about upsizing your home, t is important, also, to consider the potential resale market for larger houses. Some elements of upsized homes, such as stairs, can eliminate whole categories of buyers (such as those with accessibility requirements or young children).
Are you in the process of building a new house? Contact our iBuildNew team on 1800 184 284 or book a call for free, expert advice on choosing the right builder for you.