Buy/Retreat Dilemma- how much is owning in SCD really worth?

First post/longtime lurker and have come to the point where I would greatly value some pinster insight into my situation if possible.

Am currently renting a nice 4 bed in Blackrock for 2700pm which suits family down to the ground, walking distance to village, close to schools etc (tho mine haven’t started yet)

Have mortgage on 2 other houses, one small 2-bed end of terrace in Deansgrange - bought in 2006 (I know) for 620k, mortgage now at 420k on .5 tracker, and rented out with small shortfall - wouldn’t go near covering balance owed if I sold. Mistake was buying too small, we outgrew this house too quickly, as I work from home and when kids appeared, so did any office space. Have rented for last 2 years and plan until this year was to sit on the fence and rent for a while, continue to save (am in good but not guaranteed employment) and hope to buy something else bigger in same area as prices kept falling.

Other house in Wicklow, wife’s old family home, needs massive refurbishment but in nice spot, but driving distance to amenities. Been trying to sell this for years and had many takers but all backed out at contract stage due to complicated right-of-way issues so never got a sale over the line. Is rented out and on infinite interest only tracker at 200k so costs v little. Couldn’t tell you the value as is more or less unsaleable but rent on both combined cover both houses with small surplus when interest rates so low.

Have saved 500k in meantime (family inheritance and savings) and am worried about sitting on such an amount. But from reading this board especially the ‘missed the boat’ thread am now unsure about spending everything on another house when prices seem to be again going out of reach. Love living in Blackrock but to buy I would have to use all savings as no banks will lend with my existing debt and non-secure employment. Feel like I am caught between two stools with the two other houses and rents are now starting to go up and thinking no sense in renting indefinitely with such good savings.

So instead of paying out a whack on a third house, am now considering retreating from Dublin altogether to the house in Wicklow, doing a big refurb and maybe have the dream house but not the dream location. Wife not sure as she doesn’t drive and really wants to stay in SCD.

I suppose the question is - is living in SCD really worth going in again, am I looking at things the right way and taking the above into accounts is there anything I might be missing? Or in other words, what would you do?
Many thanks in advance

First reply. How attached are you to Dublin? Could you easily afford to leave Dublin? I mean, if you ever lose your current job - would you have a chance to get a similar job in Wicklow?

I’d retreat but my wife is from SCD and sees Wicklow as somewhere you go for picnics. Also must drive if you live in Wicklow. Have you considered option 3 which is to stay renting in Blackrock until your kids are 6/7 and reconsider?

After the last couple of years the last thing I will ever do is take a risk with family. So surprised to see so many doubling up on risk and stress.

Best of luck - you are in a fortunate position (relatively). I know of a few with 600k starter homes and no inheritance to help them get out.

Not sure I would spend a lot of money to refurbish a house I cannot ever sell. Could you resolve right of way issue? Most legal issues are fixable with time and money.

As above I don’t think Wicklow is Not a runner purely on the basis your other half does not drive…

Simply not a runner if you’ve kids IMO

I work from home so no need to commute to Dublin for anything other than shopping/entertainment etc and would arrange schools in Wicklow too

Yes, this is part of my thinking. The house needs a lot of refurb so think the ROW thing was just an extra headache for potential buyers, so if we modernise and fix this it improves sale chances in years to come.

In that Wicklow not a good place to raise them?

Have no problem renting but nervous about sitting on savings for that long. Also not sure of rental security in current place. Thank you, yes, know we are v lucky, and really want to get next house decision right this time.

500k in savings and another mortgage free house is a game changer.

If you work from home, you could live in lots of places.

For a start, I would get advice on what is required on the Wicklow house to resolve the legal issues.

Get some idea of the cost of a refurb and decide what you want to do -

  • sell as is
  • refurb and sell
  • refurb and live there

150 k would go a long way to refurbing most houses.

Live there, unencumbered, with 350k in the bank and 2700 pm going towards lifestyle/saving/school fees/whatever takes your fancy.

I would say 500k plus a house is enormous money to have access to. Don’t splash it all on a moderate house in the dearest part of the country, if you have no particular need to live there.

Why?

Would you not just invest it diversifying a bit the risk with different financial instruments? Surely you could get your money to give you a decent annual return.

I realise the place you have mortgages on on trackers so v cheap to service but would you not think of paying off outstanding debt on both properties? Sell the 2 bedroom, pay off outstanding debt with savings then solve legal issues the Wicklow property and sell that too.

Once you have done each of these you will be debt/obligation free and can then look forward to making a totally fresh start with a pile of cash and no worries over being a landlord or living somewhere that the wife may not be 100% happy with.

You could then be in a position to buy somewhere that both you and the wife loves without the worry of a mortgage. While it may not be the best financial decision in terms of rates at least it will give the maximum degree of certainty.

I agree with this.

I am totally biased towards SCD but I envy your position in that you could live someone ike Wicklow and not have to drop half a million on a three bed semi. Working from home means you should never have to do this for proximity reasons.

Your wife not driving is a hindrance, however. Is this something that could be overcome?

Is there a community around where your house in Wicklow is that you’d be happy with, or is the house isolated?

I’d be all for retreating and lowering your risk profile. Could you rent a modern house near the old house for a while to make sure your wife won’t go nuts in the sticks?

Mr’s TI and I are in a not disimilar situation. Boom time mortgage, .65 tracker rents covering mortgages we are still in our now slightly too small house. Both of us work and we have enough to save each month and with an inheritance have built up a nest egg earmarked for a bigger house. we are probably maxed out on borrowings already so not interested in taking on more debt. Any house we would like to move to in our opinion is sill either over priced or just out of our league or both. If they start to rise in any significant way I think we will just rent this place out and rent the house we want.

Your needs will change as you family gets older (you’ve already noticed that this was the driving factor of your last move)

You mentioned you’re kids are not in school yet, when they do go to school they will be going on numerous playdates and birthday parties, you might want to put them in afternoon activities eg swimming, music, GAA, ballet etc. If your wife doesn’t drive and you live far way from everyone else this might become stressful in its self. Not saying you cant do it in rural wicklow but it will be harder. When they get to about 12 they will start to want to hang around with their friends not you. By 16 you will have been wrecking their life, this will happen where ever you live but you might want to factor in how a teenager would like living in a modern renovated property in wicklow.

Have you considered school fees? if you send them to private school you could be looking at spending about €60K per kid.

What are your concerns about having savings?

Are you worried you’ll put it all on red? that the Gov will steal it? or the bank will go bust?

Does having that sum saved not provide an immense sense of security that what ever is thrown at you you are starting from a good position.

For me the biggest factor is your kids and how their needs will change over time. This will be the biggest factor in your need for accommodation and services over the next decade +. It is a cliche but the will grow very fast.

My 10c worth - Driving lessons are cheap. Much cheaper than buying a house in the most expensive area of the country because she does not drive. Investing in a driving license would be a muich better investment that buying any property.

Rule no.1 always invest in yourself.

Yes have considered this but v hard to stomach the real loss already made in the 200k already paid off this mortgage & prob looking at a further 100k to clear after sale. Feels like hard earned money down drain. Know prices on house I’d be buying would have dropped too but are alreadt starting to rise again by the sounds of it so feels like I can’t win

Very risk averse because of the insecurity of my profession and Not terribly clued in this way. Also hard to do anything with the funds while they are still possibly earmarked for house purchase, which is why I’m trying to make decision now once and for all

Here’s an alternative from left field

Take the 500k and buy a holiday/retirement home in the sun. You can rent it out for a few weeks a year to cover costs of ownership and enjoy long holidays there the rest of the year.

Keep renting for the medium/long term. Perhaps find a better deal by downsizing, and/or signing a longer lease.

Pay off the two houses that are rented out over the period of the mortgages. This provides you with a pension and/or place to live in Dublin area when the kids are moved on.

Terra incognito made the point about driving much better, dropping kids everywhere with only one driver in a rural location would be a nightmare, nothing wrong with Wicklow as a place to bring up kids

Would definitely rent as also suggested to see if you like it before spending cash on a refurb and committing to the move

It is appealing to have no mortgage and cash in the bank, gives a lot of financial independence especially if earning ability is uncertain as you allude to