selling current home on tracker and buying fixer upper

[Fanadian]

We are thinking of looking into selling our 3 bed semi. Value approx. €175k mortgage tracker outstanding 165k.

Savings approx 20k.
My gross salary just under 70k. Wife is self employed and would generate approx 35k pa. Works from home.

3 kids.

We are thinking of relocating back to my wife grand mothers house. The house will soon go on the market for about 80-90k. It is a fine property in need of a extension and modernisation. It is really old 4 bed with a lot of space behind to extend.


Just wondering what way to finance this.

---would we need to sell current property first.
---buy other property and rent while the works is ongoing
---do the banks lend for say original new property and then take out a term loan for the the work and then remortgage the entire new valuation post the works.

At present I have no idea as regards the costs of the works that we would be putting in and how much it would valued at when done. As a guess I am saying all in we put a max of 120k with the property buy price.

We will have a much larger house in a small local village as opposed to town for not much more than cost of current.

 

[goingforgold]

So you are hoping that toal cost of new property will be purchase price (c.80K) + 120k renovations and extension, ie c. 200k...correct?

I did exactly the same thing recently and believe me it costs a lot of money to do up an old house (ours was early 1980's). We eventually ended up practically knocking the whole thing as floors, wiring, plumbing, roof tiles etc all need replacing in order to be of same standard as new extension.

 

[44brendan]

In terms of financing the deal your options will be limited:
1. Yes, you will nedd to sell your existing property before you will be considered for a new mortgage.
2. You will lose your tracker rate and new mortgage will be standard variable. Before new mortgage will be approved you will need full PP for renovations. A SIP approval can be obtained subject to this plus full renovation costings to turnkey finish. usually a FPP for the works with a reputable building firm and QS approval of the costings provided. As previous poster indicated, it may be more cost effective to knock the current dwelling and start from scratch as if it's an old house any renovations works could cost higher than a full re-build. You will need to get a full survey of the property/proposed works and an assessment of costs in order to make this decision.