Upsizing Guide: Should I Buy a Bigger House?
Ready to sell your house fast and upgrade to a larger home? Our article breaks it all down for you, including:
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The steps to take before making your move – so you’re fully prepared and stress-free.
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Tips on maximising your current home’s value so you can get the best price possible.
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How to navigate the financial pitfalls of upsizing and save your time and money.
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- What You Need to Know About Upsizing
- Should I Buy a Bigger House?
- Upsizing Your Home: A Step-by-Step Guide
- Financial Aspects of Upsizing
- Sell My House Fast When Upsizing: Options for Quick Sales
- Alternatives to Buying a Bigger House
- Tips for a Successful Upsizing Process
- Making the Final Decision
- Final Thoughts and Key Takeaways
- FAQs on Buying a Bigger House
What You Need to Know About Upsizing
Upsizing is the idea of moving to a larger home to accommodate changing needs or desires. It's a common step for many, especially as families grow or when more space is needed for work or leisure.
Upsizing offers a fresh start in a home that better fits your current lifestyle.
Common Reasons People Consider Upsizing
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Growing family
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Home office needs
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Desire for more amenities
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Investment potential
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Lifestyle changes
The Advantages of Disadvantages of Upsizing your Home
Advantages
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More space for family and activities: A larger home means more room for everyone. Whether it’s giving each child their own bedroom, creating a dedicated playroom, or just enjoying more space to relax, a bigger house can make daily life more comfortable.
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Potential for home office or dedicated rooms: With remote work becoming more common, having a dedicated office space is a big plus. A bigger home might also offer the chance to create other useful spaces like a home gym, guest room, or hobby room.
Before upsizing, take a hard look at your lifestyle and how you use your current property. It’s easy to get excited about extra living space, but if they end up sitting empty, you might regret the move.✕ -
Increased property value and investment potential: Larger homes in desirable areas tend to appreciate more over time, offering strong investment potential. Selecting the right property could result in significant financial gains down the line. In fact, according to Zoopla, the average UK house price is projected to rise by 1.5% before the end of 2024.
Know more about how to add value to your home by reading this blog.
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Enhanced lifestyle opportunities A bigger house often comes with perks like a larger garden, perfect for outdoor activities or gardening. Plus, it might mean better access to amenities, schools, or a more desirable neighbourhood.
Disadvantages
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Higher costs: Your budget should be able to handle the higher mortgage, increased utility costs, and maintenance expenses without causing stress.
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More time spent on upkeep: More space often means more time spent on cleaning, repairs, and general maintenance. This can eat into your free time and leave you with less time to enjoy your new space.
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Potential for unused areas: Extra rooms can be great, but they can also end up being underused.
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Longer commutes or distance from city centres: Imagine upsizing from a small city flat to a larger house in the suburbs. You gain space and a garden, but now face an hour-long commute. Over time, the strain of the commute and extra costs might make you rethink the move.
Should I Buy a Bigger House?
Before moving to a new place, evaluate these important factors to make sure your move aligns with both your current and future needs.
Assessing Your Current Living Situation
Start by taking a close look at your current home.
Is it starting to feel cramped, or do you find yourself longing for more space? Maybe the layout no longer suits your lifestyle, or perhaps your family is growing, and you need an extra bedroom or two.
Understanding what’s driving your desire for more space is the first step in deciding whether upsizing is the right move.
As Lucian Cook, director of residential research at Savills, points out, “People’s buying power typically hits a peak in their forties, which is when you see the most activity in higher price brackets. But upsizing is becoming more challenging and increasingly confined to more affluent households, especially with more older homeowners staying put for longer and creating fewer opportunities for people to trade up.”
This highlights the importance of assessing your current situation and planning wisely.
Future Needs and Long-Term Plans
Imagine you're currently living in a two-bedroom flat and working from your dining table. While it works for now, part of your plan might be to start a family and expect to work from home more permanently.
In this case, upsizing to a three-bedroom house with a dedicated office space could be the smarter move because it gives you room to grow and a more comfortable work environment in the future.
Advice from Paul, our in-house property expert:"When you’re thinking about upsizing, don’t just focus on your current needs. Consider where you’ll be in five or ten years. You want a home that’ll still work for you down the line."
Financial Implications
A bigger house often comes with a bigger price tag—not just in terms of the mortgage but also in higher household bills such as heating and electricity costs, maintenance costs, and possibly increased council tax.
It’s necessary to crunch the numbers and make sure your finances can comfortably support the additional expenses.
Lifestyle Changes
Moving to a larger property often goes hand-in-hand with a lifestyle change. Whether you’re looking for a bigger garden, more room for hobbies, or simply a more comfortable space to unwind, it’s important to reflect on how a larger home will fit into the life you want to live.
Will the added space bring more joy and convenience, or could it lead to more upkeep and stress?
Understanding how upsizing will impact your day-to-day life is essential to making a decision you’ll be happy with in the long run.
Upsizing Your Home: A Step-by-Step Guide
Deciding to upsize is a big step, and doing it right can make all the difference. Here are the steps you need to take if you want to upsize your house.
Evaluate Your Needs and Wants
Start by figuring out what you really need versus what you want. Here's a checklist you can use:
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How many bedrooms do you need?
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Do you need a garden?
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Is a home office essential?
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Do you need an extra room for hobbies?
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Will you entertain guests often?
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Is a larger kitchen important to you?
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Do you need a separate dining room?
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Would you like a garage or extra parking space?
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Do you need additional storage areas?
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Is proximity to schools or work a priority?
Set a Realistic Budget
Next, take a hard look at your finances. Upsizing involves more than just a bigger mortgage—there are many costs to take into account:
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Mortgage: If you're looking to upsize to a home costing £400,000, and you put down a 25% deposit with 5.8% monthly repayments, your mortgage will be £1,896.
If you have a home that has a property value of £200,000 property value, a 25% deposit, and 4.4% monthly repayments, then your mortgage will be £962.
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Stamp duty: On a £400,000 home, you would pay around £7,500 in Stamp Duty under current UK regulations. You can also check the SLDT calculator here.
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Utility bills: Expect to pay around £250-£300 per month for utilities in a larger home and about £150 per month in a smaller property.
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Maintenance: Annual maintenance costs could increase from around £1,000 in a smaller home to £2,000 or more in a larger one.
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Insurance: Home insurance for a larger, more valuable property might increase from £300 per year to around £500-£600 per year.
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Moving costs: Hiring a professional moving service could cost anywhere from £800 to £1,500.
Tip: Set a budget that includes these considerations so upsizing doesn’t lead to financial difficulties.
Research New Neighbourhoods
Where you live is just as important as the house itself. Take the time to explore different neighbourhoods that meet your needs. Examine the following:
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Commute times
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Local schools
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Amenities
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Community feel
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Future developments
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Crime rates
Taking these into account can help you choose a neighbourhood where you’ll be happy and secure.
Time Your Move and Plan How to Negotiate
Timing can have a significant impact on your move. Assess both the housing market and your personal circumstances.
Advice from our Property Expert Paul:"Moving during a buyer’s market, when there are more homes available than buyers, can give you more bargaining power and better house prices.
However, if you’re selling your current home at the same time, you’ll need to balance this with the market conditions for sellers.
On a personal level, consider your job stability, the school calendar if you have kids, and even the season—spring and summer moves are typically easier but can also be more expensive."
In the UK, nearly 70% of house buyers successfully negotiate house prices, so choosing the right moment to buy or sell could give you the leverage to secure a better deal.
Financial Aspects of Upsizing
When you plan to upsize, understanding the financial implications is crucial.
Calculating Affordability
Before you start house hunting, it’s essential to know what you can realistically afford. Here’s an overview of how to calculate it:
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Current income: Start with your total household income. For example, if your combined annual income is £60,000, your monthly income would be around £5,000.
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Debt-to-income ratio: Lenders typically prefer a debt-to-income ratio (DTI) of 36% or less. This means your monthly housing costs (including mortgage, taxes, and insurance) should not exceed £1,800 if your income is £5,000 per month.
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Down payment: Consider how much you can put down upfront. A 20% down payment on a £400,000 home would be £80,000. This reduces your mortgage amount and monthly payments.
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Monthly budget: Subtract other monthly expenses (e.g., car payments, utilities, groceries) from your income. If you spend £2,000 on non-housing costs, you’d have £3,000 left for housing expenses.
Mortgage Options for Upsizing
There are several mortgage options when you are planning to upsize:
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Fixed-rate mortgage: It offers a stable interest rate for the entire term, typically 15 to 30 years.
For example, on a £320,000 mortgage (after a £80,000 down payment on a £400,000 house) with a 4% interest rate, your monthly payment would be about £1,528 for a 30-year term.
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Adjustable-rate mortgage (ARM): It starts with a lower interest rate for a set period (e.g., 5 years) before adjusting annually. It might be beneficial if you plan to sell or refinance before the rate increases.
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Offset mortgage: This links your savings account to your mortgage, reducing the interest you pay on the mortgage balance by offsetting it against your savings.
If you have £20,000 in savings, you’d only pay interest on £300,000 of a £320,000 mortgage. This effectively lowers your interest payments and saves you a significant amount of money over the life of the mortgage.
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Interest-only mortgage: This allows you to pay just the interest for an initial period (usually 5-10 years), but you’ll need to pay off the principal later. However, this method often results in higher payments.
Advice from our Property Expert Paul:When choosing a mortgage, think about how it fits with your future plans. For example, an adjustable-rate mortgage (ARM) might seem appealing with its lower initial payments, but be ready for possible rate increases after the fixed period ends.
If you’re planning to stay in your new home long-term, a fixed-rate mortgage could offer more stability. And if you have substantial savings, an offset mortgage could help you cut down on interest costs. It’s always a good idea to consult with a mortgage advisor to find the best option for your situation.
Hidden Costs to Consider
When upsizing, it’s not just the mortgage you need to think about but also the often-overlooked costs:
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Property taxes: If you’re currently paying £2,000 per year, expect this to increase to around £3,500-£4,000 for a larger home.
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Homeowners insurance: This could rise to £500-£600 annually.
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Home maintenance: Budget at least £2,000 annually for ongoing repairs and upkeep.
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Utilities: If your current bill is £150 per month, it could increase to £250-£300.
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Moving costs: A full-service move might run £1,000 to £1,500, depending on distance and the volume of belongings.
Sell My House Fast When Upsizing: Options for Quick Sales
If you need to sell your current home quickly to upsize, check out these strategies:
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Property Buying Companies: Selling to a company that buys in cash can expedite the process. You might get an offer within 24-48 hours and complete the sale in as little as 7-14 days. However, be prepared for a lower offer, typically 10-15% below market value.
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Auction sales: According to IBISWorld, more people in the UK are turning to auctions as a convenient and fast alternative for buying or selling property. However, the final price can be unpredictable.
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Estate agent fast sale services: Some estate agents offer fast sale services, helping you sell within 4-6 weeks. Keep in mind that this might come with a higher commission fee or a discounted sale price.
Related read: The Psychological Benefits of Selling Your Home for Cash (Stress Relief & Fast Sale)
Alternatives to Buying a Bigger House
If upsizing isn’t right for you, consider these alternatives:
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Renovate or extend: Add an extension, convert the attic, or update key areas like the kitchen to create more space without moving. If you want to know more about the home renovations that do not add value to your house, you can check this blog.
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Optimise existing space: Declutter, reorganise, or remodel. For example, turn an unused dining room into a home office or convert the garage into a playroom.
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Relocate to a similar-sized home: Move to a different area with the same square footage that offers better amenities, more outdoor space, or a quieter environment.
Tips for a Successful Upsizing Process
Upsizing can be a smooth and successful process with the right approach. Here are some tips to help you navigate it effectively.
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Figure out your must-haves versus the things that would be nice to have before you start your search.
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Make sure your budget is realistic and covers all the possible costs.
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Team up with an estate agent who really knows upsizing.
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Get pre-approved for a mortgage to make the buying process smoother.
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Declutter and stage your current home to make it as appealing as possible.
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Think about the timing of your sale and purchase to avoid juggling two mortgages.
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Do your homework on new neighbourhoods to make sure they’re a good fit.
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Keep an open mind and be ready to handle any surprises along the way.
Making the Final Decision
Wondering if getting a bigger property is the right move for you? It’s a big decision, so taking the time to think it through is necessary.
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Weigh all factors: Start by reviewing everything—your financial situation, the space you need, the state of the housing market, and your long-term plans.
Consider how these elements fit into your overall lifestyle and future goals. It’s important to see the big picture rather than focusing on just one aspect.
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Create a pros and cons list: Sometimes, laying it all out in a pros and cons list can help clarify your thoughts.
Include everything from financial implications to the emotional impact of moving. This can make it easier to weigh the benefits and drawbacks and lead to a more balanced decision.
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Seek advice from financial advisors and real estate experts: Before making a final decision, it’s smart to consult professionals.
A financial advisor can provide insight into how upsizing will affect your long-term financial health, while an experienced estate agent can offer guidance on market conditions and property values. Their expertise can help you avoid potential pitfalls and make the best choice for your situation.
Final Thoughts & Key Takeaways
Upsizing your home is a big decision that requires careful thought and planning. It's important to consider all the factors, from your financial situation to your long-term goals, to ensure that upsizing truly benefits your lifestyle.
As you move forward, keep these key points in mind:
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Review your personal circumstances to make sure upsizing aligns with your future plans.
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Understand the full financial impact, including hidden costs and potential market fluctuations.
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Take the next steps by working with trusted professionals and preparing your current home for sale.
Frequently Asked Questions on Buying A Bigger House
