Living in city and hoping to move house+job to town 150km away

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Lisnsooz

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Hi everyone,
Would really appreciate some advise on following conundrum - am wondering have we exhausted all options. We are trying to buy a house in the country before we sell our current house in Dublin.

Current situation:
  • We have a house in Dublin where I and husband both work. He can work from home or in office - completely 100% flexible, I need to be in public service office at least 3 days per week.
  • We want to move down home nearer to elderly parents, to small town 150km away. I will need to move jobs eventually as the commute 3x days per week would be about EUR200 per week with tolls and fuel.
  • We have about EUR 35K in savings. Dublin house has estimated equity release of about EUR 300K if we sold tomorrow and cleared mortgage. House prices in small town are EUR 250-300K, however, there are few and far between on the market. Our combined salaries is EUR120K and we don't have kids or high outgoings except the current mortgage (EUR 850 pm, there is EUR130K left on fixed term mortgage, the house currently valued at about EUR430-460K)
Problem: We worry about putting Dublin house up for sale, going sale agreed, and then finding nothing suitable to buy in small town and end up being homeless as there is no rental market in small town and not enough room in relatives' house to stay temporarily. Our hope was to finalise buying a house in the small town (thus avoiding becoming homeless) and then live between there and Dublin for a few months whilst I secure new job in small town and then we sell Dublin house.

What we have tried: As we don't have the deposit to try and buy a second property outright (ie - a holiday home that would then become our principal residence), we are trying to release equity on the Dublin house to boost our deposit.
  • We've explored Finance Ireland/ICS mortgages to release equity from the house (up to 70-80% re-mortgages - can't get 100% remortgage) and tack on a small extra mortgage to make up the difference in house price, but have been scuppered as can only use a BTL mortgage when using equity to purchase a second home (according to our broker). FI and ICS have been the only companies that allow equity release to be used to go towards purchasing a property.
  • We had tried to position city house as a prospective rental and get BTL on that address to 'bridge' the gap but then I needed to prove I had work in the small town for 3x days pw (as obviously underwriter knew commute would eat into finances). I cannot move jobs until I am living in new town. I can't negotiate more than 2 days wfh with current Dublin job. That was with FI.
  • Could not get BTL on a prospective small town house because ICS don't do BTL on population centres less than 10K people. We did not try FI at this point because they are currently suspicious of us having put in two previous mortgage applications with varying equity release amounts.
Are we buttering our bread on both sides here? I can only see two options left to us after months of broker wrangling:
  1. continue saving to have a 20-30% deposit and hope that one of the financial institutes will let us purchase a 'holiday home', which would then give us a few months to move house and also let me move jobs without an onerous commute cost. Broker has advised this is not a guarantee however (getting such a mortgage). We would not be able to do this till at least one year's time.
  2. have Dublin house ready to put on market and once we find something we want in small town that a purchase looks achievable for, trigger Dublin sale (and then hope the stars align?).
thanks in advance to anyone who can suggest an alternative strategy.
 
You should first decide where you want to live in the long term - beyond the lifespan of your parents. If you sell and move out of Dublin now, you may never be in a position to get back.

Normally, people only put their own house on the market after they identify an alternative property that they want. Most houses inDublin sell quickly these days so it’s not like your new property’s seller would be hanging around too long.

However, If you think you may ever need to move back to Dublin in the future, maybe you should rent wherever you want to live in the immediate future, and then rent your house in Dublin. You may even be quids in for the duration.
 
While you say there is no room in elderly persons home, is there room to expand or land/garden to put a log cabin home on for the short - medium term. Accelerate the savings to have higher deposit is there an alternative location nearer the relative that would have more of a choice of property for sale/rent and that would be an easier commute I.e. Public transport
 
Did something similer 15 years ago, ended up living with the inlaws for 2 months with a 6 month old baby in tow whilst we completed a purchase and got some work done on it. Wasn't the easiest 2 months to be honest but sometime you need to take the longer picture. Is living with the elderly parents and option for a few months with furniture etc in storage. ?
 
Look at it from the lender's perspective, you haven't saved up enough for a deposit but you want to release equity in the current house and take on more debt for the new one, with the risk of an extended period where you'll have to pay both mortgages. Not an attractive proposition.

Instead of approaching them on the premise of buying a holiday home, you could say you are going to rent out the current property once you move in to the new one. Some lenders will factor in a percentage of prospective income in the affordability calculations. Once you move in to the new place, you are then free to sell the Dublin property.
 
niceoneted said:
While you say there is no room in elderly persons home, is there room to expand or land/garden to put a log cabin home on for the short - medium term.
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The current state of the construction market means expanding isn't cheap or quick, likewise a log cabin of habitable standards is not cheap and it can be very difficult to get the required planning.
 
Thanks so much for your replies Salvadore and Niceoneted.
The small town is my partner's home town (lots of family around) and is halfway to where my family live, so all in, we see ourselves living there in the future permanently. We have only been in Dublin for work purposes. So we defo are keen to make that move. But sadly nothing suitable comes up for rent (recents just been a couple of apartments and we have a dog and need proper wfh space).
We did consider moving nearer to a town 40 mins away, rent there whilst still looking in the small town, as that would tackle some of the commute time but we'd have zero network there unfortunately, and none of what we want in Dublin/home
Leo said:
Look at it from the lender's perspective, you haven't saved up enough for a deposit but you want to release equity in the current house and take on more debt for the new one, with the risk of an extended period where you'll have to pay both mortgages. Not an attractive proposition.

Instead of approaching them on the premise of buying a holiday home, you could say you are going to rent out the current property once you move in to the new one. Some lenders will factor in a percentage of prospective income in the affordability calculations. Once you move in to the new place, you are then free to sell the Dublin property.
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Thanks Leo, yes we tried BTL rent options as mentioned but that wasnt a runner as I need to be working in the new area to do that. I can only move jobs once i know for sure the move is secure else will be paying a fortune in commute and then that money is what I'm trying to save, catch 22 unfortunately.
 
Peanuts20 said:
Did something similer 15 years ago, ended up living with the inlaws for 2 months with a 6 month old baby in tow whilst we completed a purchase and got some work done on it. Wasn't the easiest 2 months to be honest but sometime you need to take the longer picture. Is living with the elderly parents and option for a few months with furniture etc in storage. ?
Click to expand...
Sadly just not an option as already other family living there and house too small.
 
If you approach the pirchase as holiday home you could end up on a much higher rate.

Id say think about the following
1. Put your house up for sale
2. Try source a house to purchase and reach out to local EAs
3. Look at rental in nearby town - its not gonna be forever so you might need to compromise about location for some time.

You're overly complicating the process.
Plan to throw everything into storage. If need be can you kennel your dog for some time?
You have over 335k between equity and savings and can easily obtain a mortgage. You will be in an incredibly strong position once something comes to market.

Think longer term and be prepared for some inconvenience.

If you've decided you want to sell the house in Dublin, get the ball rolling on that. Interest rates are rising which could impact resale value, but as a cash buyer you are less impacted.
 
How "generic" is your Dublin home? If you have a standard 3-bed semi it will sell very quickly.

Markets tend to be less liquid outside Dublin and vendors are more likely to tolerate a delay.

This all points to finding the house you want first, then pushing the button on the sale of the Dublin home.

Maybe only bid on homes where vendor is not in a chain.
 
You could sell your current home and rent in Dublin in the short term (if you are not insistent on living in South Co Dublin you can get a 3 bed in say Swords for 2200pcm & less if you can squeeze into a 2 bed), you can claw back around 280k out of the equity difference on your old home after other expenses, and rent for say, a year, you could still borrow a small mortgage (say 50k, which is the minimum) which would give you about 30k to spend on rent while you find a place to buy in the country. And if you change your mind on that, you can always go back and buy in Dublin, albeit you'd have a slightly bigger mortgage. Given that you have 35k in savings already, you have enough to cover you while you look for a home to buy down there - its highly unlikely that you'd find nothing in the space of a year you like.
 
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