Hi there, this is my first post.

Me and my girlfriend are unsure which investment in the property market to consider. At present we live in a 3 bed semi detached house in South Manchester worth about £150,000 with an outstanding mortgage of £77,000, it’s an interest only mortgage of £283.00 pm (it was the only way I could afford to keep the house whilst going through a divorce). We have no children living at home although I do have 2 kids from my previous marriage that I see on a regular basis. We both have reasonable jobs with a joint salary of £55,000 pa, we have very little debt apart from our car loans.

It would be ideal to move out of my former marital home so that we can have a fresh start and return to a repayment mortgage. But we’re happy to consider other options before we embark on the dreaded 25 year mortgage treadmill. Such as self build, off plan properties, buy to let, property development. Which is best for us . Any advice would be appreciated. Btw I’m happy to get my hands dirty and quite keen at DIY.

David and Louise

Hi Bob,

Silly me , have you got any ideas on any other forums which might be of use?

David

There are quite a few places where you could ask:

Homes On Sale - Property Forum - Powered by vBulletin
Property Watch forums - Powered by vBulletin
House Price Crash forum

and maybe even:

LandlordZONE Property Forums

As for your personal circumstances, David, it really depends on what your aims are. I recently bought my first home, and although I put all options on the table, at the end of the day what was most important was a stable home for a young family.

It's worth remembering that whatever property you buy is inevitably going to be an investment in the long-term.

From what you've mentioned, especially moving out from the old marital home, it seems like settling the family is going to be a first priority rather than overseas investment.

In which case, target the areas you'd like to consider living in.

The fact that you've got a pretty decent disposal income and a property under your belt already means you're well up on the property ladder already, and while you may dread that 25 year repayment mortgage, your circumstances at present suggest that if stable, you should have no problems coping with it.

Something else you may want to consider is looking more closely at your interest-only repayment - an endowment, I presume? This is because there has been so much mis-selling in this area it's worth ensuring that you are genuinely covered, and also that you were sold a plan that genuinely suited your needs. Last thing you want to do is rely too much on an interest repayment plan if it's not going to do what it says on the tin.

2c.

Often the mortgage lenders will not accept just one of the couple having the house as it is not financially viable. The wife may have to go back to work, but there will be child care costs. The husband wants his share of equity out of the house. he has to buy or rent elsewhere. Practical financial planning is needed. Perhaps selling up will be the only option and then using savings or cashing in policies.
The spouse who is looking after the children can try to seek a capital split more favourable than 50-50 to cover the cost of housing children but this is not in your case.