To Buy or Not To Buy

Applecart

Registered User
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I am in a bit of a bind, would appreciate if askaboutmoney readers could give me some suggestions. I have recently been bought out of my family home in a marriage separation situation, and have a reasonable sum of money on deposit. I want to live in the general area of the family home to be near my children but not exactly across the road. This limits my house choices as most of the suitable second hand homes are in the vicinity of the family home. Also, since the start of the year, not many second hand homes seem to be coming on the market/ most are not suitable. Thus a second hand house whilst not a non- runner does not look very viable.

I have a booking deposit on a new homes development that is in the area that ticks plenty of boxes, but have concerns about road noise / distance from public transport and also the orientation of the house (sun gone from 12 noon in main kitchen/ diningroom living area, front room is small) ie it does the job but is not ideal. I consider the house well priced, quite salable in the future (last houses in development/ also smallest and least expensive ones), and it is ready for immediate occupation. To summarize, i have doubts about it but it could all turn out fine.

I have to make a decision imminently.

There is a second new development that on paper at least ticks the boxes better, and overall I feel better about, notwithstanding I have not seen the finished product, just the detailed plans on paper. Assuming prices do not go up, it would be somewhat cheaper than the current option (perhaps 5-10%, guesstimate), as it is in a perfectly acceptable but what the market considers a less"exclusive" area. Construction has just started on the first phase, they are timber frame and should in theory be built quickly.I have spoken with the guys on site / the EAs who will be marketing it, and the "for sale" date (not completion date) keeps slipping. They have said July, now its September, but if there was further slippage on this, one wonders if it could easily be Spring 2016.

My concern is that if I hold out for the apparent better option, I will end up paying more, and having to rent for maybe a year or more. As I have good capital, the transaction costs of buying and then selling are roughly about the same as renting for a year, and I have the security of my foot back on the property ladder.

Is there any logic to buying the current option, keeping an open mind about moving to the new house development when it is ready for occupation in 9/12/15 months time? Is this nuts? I've been through a lot lately and am prone to find problems with any options/ am admittedly very indecisive. I have to balance concerns about sitting on the sidelines having capital eroded by price rises (which is worrysome) versus inevitable hassle +of possibly moving house again/ moving into a new house that you might be contemplating moving out of which is a bit strange.

Of course a suitable second hand could appear on myhome in an hours time, but looking at the property register over the last 2 years, little suitable as come on.

I'm getting quite stressed by this and can't decide what way to jump! I am hearing a series of contradictory voices from friends and family.

Any ideas? Buy or sit on the sidelines?

Just as an aside, would an EA on new homes expect your current home to be sale agreed before they would take even a refundable booking deposit on a new home? Must you have sold your own home first?
 
Why are you waiting for your current home to be sold when you said initially that you had the money on deposit from the separation agreement.

If you have a deposit down already, how do you propose getting it back. Have you signed contracts.

Personally I would not buy a house 'off plan'.

It seems to me you've plenty of choices of house but cannot make a decision. Stop listening to family and friends and just pick a house that you like.
 
I am bought out of the family home so I have a large sum on deposit, which would make up most of the purchase price of any house. I have a refundable booking deposit on a house that is already completed but I have reservations about as outlined above.Basically my head likes it but my heart has various reservations. There is a second development that has just started in the same general area which the EA says they are"reasonably confident" of going on sale in sept 2015 with occupancy by dec 2015, which seems like a better option. EA feels it will be somewhat cheaper at current prices. I have the detailed planning drawings and am very familiar with the site. Trouble is house prices could have jumped by 5-10% by them which would put it up by 25-50K, or any significant delays could push things into 2016. There are very few second hand options in the area, and they come up infrequently. Thus worried about staying on the sidelines for too long
 
No one has a crystal ball of future house prices besides we not allowed to discuss them here. You are in a good position in that you have most of the purchase price of a home. Its just you are undecided between two options. Only you can decide whether to buy the one you have the booking deposit on or wait until this new site is developed. Either way you going to have to let estate agent know soon.
 
Don't buy the first option if you think there's a chance you will want to sell a year down the road to purchase the second option.
If you're selling & buying at about €500k you are looking at stamp duty of €5k (twice), EA fees of around €7,500 to sell and solicitors/legal fees of up to €5000 for a sale & purchase. Plus the costs of valuations, BER Certs, moving etc.

You're probably used to making a decision with someone else & now you are making decisions just for yourself again. That can be daunting. Your choice seems to be to commit to house 1 now (which your head says yes to) or wait & rent for up to a year for house 2 - for which there are no guarantees - will it definitely be built, what price will it go on sale for, when will it be available?

No-one can really tell you what to do. The first decision is whether you like house 1 enough to commit to it. Or if you don't then wait for either house 2 or another house. Don't buy just for the sake of it. It's too much money & too big a commitment not to feel happy about your choice.
 
I have spoken with the guys on site / the EAs who will be marketing it, and the "for sale" date (not completion date) keeps slipping. They have said July, now its September, but if there was further slippage on this, one wonders if it could easily be Spring 2016.
Emphasis mine. I think you know what I mean.

As I have good capital, the transaction costs of buying and then selling are roughly about the same as renting for a year
Unless you are a engineering solicitor who moonlights as an estate agent, I doubt it.

the security of my foot back on the property ladder.
Aaah. You've got 20-30 years worth of rent sitting in a deposit account. You don't need to buy a house today, or tomorrow, or ever if you don't feel like it or the prices aren't right. Invest it well (or even ok) and it can pay for your accommodation indefinitely.
 
Thanks you for all your posts, much appreciated. Butter has made a key point- usually people make a decision as a couple about this whereas I am ultimately making this on my own. In fairness, the EA on the new development not yet built is being genuinely helpful- they will have no problem selling these houses once they are built. Renting locally would be about 1500 pm for a house that could take my kids every second weekend, so thats 18K in one year...
 
[QUOTE="Applecart, post: 1423028, member: 90388" In fairness, the EA on the new development not yet built is being genuinely helpful- they will have no problem selling these houses once they are built. [/QUOTE]

Now where did I read this before ...
 
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