Upsizing family home.

Me and family are looking to upsize and want to look for some advice before I tackle the bank(s).

We estimate our house is worth 200k and would likely be able to sell.
We still owe 145k on that house (and no other debts).
We have 150k in savings.

We want to purchase a house for approx 380k (hopefully less if we get them down)

Me and Wife have a combined gross income of around 110k with jobs more or less secure (no compulsary redundo imminent anyway).

Ideally we would like to buy this bigger house and keep existing property to rent out until prices do eventually rise and then sell.

Any advice on the chances of the bank giving us another mortgage based on our circumstances above ?

Would we likely have to sell our existing property to buy the bigger house even though we could comfortably look after both mortgages (even should interest rates increase) and pay deposit on new property ?

Thanks a mill for any advice.

I'd say the banks would be happy to see you coming in as you are in a pretty strong position. Few things to bear in mind:

- if you hold onto your existing property, what kind of mortgage is on it? If is tracker, you are unlikily to say on it at the same rate as many bank would see it as an investment property & up your rate accordingly. You may be better looking at a different bank - but I'm not sure of the consequences of net declaring to the bank of the property is no longer your PPR.

- With savings of €150k, you would be looking at getting a mortgage with a fairly low LTV ratio, plus you have a good income, I reckon you should be able to get a 2nd mortgage pretty easily.

Do consider what is involved in being a landlord & the hassles:
- regulations (PRTB, 2nd home property tax, tax implications, BER rating etc)
- hassle with bad tenants (can put the most hardy landlord off)
- 2nd home to maintain, insure, clean (for relets),
- CGT will be due if the property raises in value
Do you know anyone who is a landlord? Have a chat with them and be sure you have the personality do do the job - it doesn't suit everyone

How old are you?
How long have you been in current employment and in what industry?

Thanks Sam_h you have given me some food for thought.

Is it going to be worth keeping property in terms of mental health reasons (ie no hassle, people, financial, tax etc..) for the sake of holding on for possibly a number of years for the housing market to possibly swing upwards again and making some sort of profit....possibly.

In the short term life would be easier to just sell and concentrate on the family home - eggs in one manageable basket.

In the longer term, holding on and putting us through a bit of hassle and possibly stretching us financially could enable us to reach mortgage free status a lot sooner. We'd always have the 'get out' of being able to sell the smaller property (surely can't get any worse than now ?) if we find it too much of a headache.

Our existing property mortg is on a tracker.


I have relatives/friends who are landlords and yes, I hear all the bad news stories.

Mr DT,

I am 33 work in IT in a heavily unionised semi state company trying to get rid of staff - but is all voluntary.

The Wife works for HSE. 39 years old.

why do you need to upsize?

House worth 200k
Left to pay 144k
Joint salaries of 110k
Savings 150k.

Went to Ulsterbank and they said we could borrow up to 510k for a new house (and keep the existing house).

Then went to BOI. They said it was 4.5x the joint incoming minus what we owe on our other house and then multiply this by x0.92.
This came out at ~300k

Obviously I want to go with BOI @ 2.65% vs UB @ 3.75%

Can anyone make out the BOI calculation as to what we can afford? Why would they multiply it by 0.92 ?

Why will UB lend 510k and BOI lend just 300k ? - thats a big difference.

I'm assuming because you can only borrow 92% of the new house price?

Don't know really, but that's all I can think of.

We have looked at this too. Banks will give us morgtages based on the two properties and our earnings to cover them in case there is no rental income. We also have combined earnings of about €110K and therefore could get a mortgage of between €500-€600K but this would be split between the two properties. So maybe this is what BOI are bearing in mind. Banks look for about a 75% LTV (BOI) and less on a buy to let, depending who you are talking to. So perhaps they are offering €300K extra on your exisiting mortgage. As you have an LTV of about 75% in your existing property the 300k would bring your total borrowings to about 450K???

Forgot to mention...you value your property at 200K but the bank may not and are apparently undervaluing them on purpose as a buffer. So when BOI look at your figures they may see the LTV on your exisiting property as a lot less.

Sorry a lot more!!!

As an aside...
@ Ash21, do you know you can edit your posts so you don't have to use new posts everytime you remember something?

Not trying to be Mr. Nitpicky or anything, I promise.

Thanks Soarer will bear in mind in future, it won't happen again!

Thanks Ash21

This what we have found so far.

Usterbank - will take potential rent of prop #1 into account while calculating max loan. Will lend up to 510k

Bank of Ireland - no idea what they are up to (I think I got a trainee). But they dont take into account rent from prop#1. Will lend 300k (I reckon they got this wrong tho)

EBS - will take potential rent of prop#1 and calc max loan at 330k
(but will only lend 85% of new house).

AIB - yet to visit.

I would go with Ulsterbank at a drop of a hat if their rates were anyway competitive.

You are in a much better position than us in that you have €150K in savings...I'm very envious.

I spoke to EBS too, they said about €600K on new property and would take into consideration rental income on top of this to cover existing property provided equity is left alone. But we don't have enough cash for the deposit and SD without pulling out some equity. They said they would loan us up to 90% on the new property as we are "existing members". I take you are not so I wonder is there any room for manouvre here...

Agree with you on UB but would be really interested to hear how you get on with AIB.