[adagio]

DH and I live in a 2 bedroom unit which we are currently paying off. Purchased mid 2009 for $337000, currently owe 311000. I think its worth approx 360000 at the moment (haven't had it valued though)

We hope to TTC mid 2011 but we are unsure about our living arrangements...

We don't know if we should sell our unit (in an upmarket suburb) and purchase a small house (that will need work) in the best area we can afford.....

...... we are aiming to one day (in the next 3 - 5 years) buy a house anyway but don't know if we should do this before we have our first baby.

The only issue I can think of is if we purchase a house our mortgage will be higher, putting more pressure on DH when I am on maternity leave/possibly meaning I will have to go back to work earlier.

DH doesn't want to sell the unit and wants to keep it as an investment property in the future, but we wouldn't be able to purchase a house and keep the unit at this point in time.

WWYD? Stay in the unit and save for a house in the future or try to purchase a house before baby? I think we should stay and pay off as much as the unit as we can to gain equity for a house?

I am slightly concerned about the space issue (it's not a tiny unit but a unit all the same!) & we have two indoor cats. Do you just make it work?

This post has been edited by Sylvest3r: 24/08/2010, 08:08 PM

[crazy*cat*lady]

Get the unit valued. It costs nothing and will mean you have a better understanding of where you sit financially. You can then decide if you sit tight or sell and buy now.

We sold a 2br flat and bought a house and it was fantastic. The market exploded in the 18 months I owned the flat and I ended up going from the bare minimum deposit on the unit to a 10% deposit for our house.

[Tsikos]

We had a 2 bedroom unit that we lived in until DS was 2.5 and I was about to birth DD. Others in the block had 3 children in their unit but 2 were common. It was in Randwick , Sydney. It was okay. Not fantastic but you adapt your life to visit parks, beaches etc and even now in a house we're not home any more than we were in the unit - we needed the extra bedroom for DS#2 and office a house offered.

We sold that unit to buy our house - but we'd paid the unit off...

Assuming the unit was purchased for the maximun mortgage you could easily afford, after selling you'll come out with only a few thousand...where do you live that you can buy a house for the odd 340,000?

You also need to take into account the cost of selling and buying. We recently moved and it cost over $65k in primping, advertising, real estate, lawyers fees, stamp duty, taxes etc to just 'move' - before the cost of removalists or reconnection fees etc etc.

[Ruffles]

I kept my unit and rented it out when DH and I bought our house. The rent didn't quite cover the mortgage payments then, but I make a profit of about $2 000 per year now.

When I went on Mat leave, I changed the mortgage to "Interest Only" which reduced the repayments a little. But with the rent covering it anyway, it is no big deal.

Really do your figures. You may well be able to keep it, if the rental return outweighs the repayments. The long term investment will be great for us, eventually.

[imamumto3]

we lived in a unit until ds was 1, it was fine apart from the 3 flights of stairs we had to walk up from the garage. When DS was about 8 months or so we would walk to a park to play on the grass etc

[adagio]

thanks

[mama2carysbailei...]

just another point to consider, when you have kids your borrowing power goes down alot more than we expected. If you go online to a mortgage calculator and put in your details without kids and then with there will be quite a big difference. We were thinking of ttc no3 but if we ever want to move from our cottage to a house we need to move first as we could borrow about $40k less after another kid. Which would make quite a difference interms of areas we were looking at.
Laura