holaquetal
Registered User
- Messages
- 20
hello all,
hoping you could help us decide what's the best way to go with our situation, using your experience and wisdom
Entry data:
- we own a property that is valuated at around 430-450k now (no mortgage)
- we need a bigger space (+1 bedroom), which is why are looking to upgrade the house/apartment
- we got mortgage approval for 520k
- we are looking into 3 options:
Questions we need to answer (hopefully with your help!):
- If we keep the 1st property, we'd most likely rent it out. While the income would be about 2200-2500 per month, after tax it would be just 1100 - 1200 (would not cover the full cost of mortgage repayments for the second property). Renting a property is a hassle (what if someone does not pay, equipment breaks, additional tax adviser fees etc). Is this income worth the hassle?
- If we sell the 1st property, then, obviously, when we pay out the mortgage on the second property, we'd have less overall assets, than what we'd have with 2 mortgage-free properties. Is the assumption correct, or we are missing something?
- quality of life vs. the cost: is it totally insane to be "paying" for the quality of life (like less commute, bigger garden, more space)?
thanks in advance for all your insights.
hoping you could help us decide what's the best way to go with our situation, using your experience and wisdom
Entry data:
- we own a property that is valuated at around 430-450k now (no mortgage)
- we need a bigger space (+1 bedroom), which is why are looking to upgrade the house/apartment
- we got mortgage approval for 520k
- we are looking into 3 options:
- buying a second property and keeping the existing one. Getting the mortgage of 520k
- selling the existing property and buying a bigger property in the same area (+1 bedroom). Getting the mortgage of 30-40k
- selling the existing property and buying a bigger property in an area closer to work, school and creche (which are unlikely to change in the upcoming 15 years, read = quality of life, no commute) Getting the mortgage of 300-350k
Questions we need to answer (hopefully with your help!):
- If we keep the 1st property, we'd most likely rent it out. While the income would be about 2200-2500 per month, after tax it would be just 1100 - 1200 (would not cover the full cost of mortgage repayments for the second property). Renting a property is a hassle (what if someone does not pay, equipment breaks, additional tax adviser fees etc). Is this income worth the hassle?
- If we sell the 1st property, then, obviously, when we pay out the mortgage on the second property, we'd have less overall assets, than what we'd have with 2 mortgage-free properties. Is the assumption correct, or we are missing something?
- quality of life vs. the cost: is it totally insane to be "paying" for the quality of life (like less commute, bigger garden, more space)?
thanks in advance for all your insights.