stay put and save or buy bigger property now?

[want2findout]

My boyfriend and I are getting married this year. We're currently living in my boyfriend's house which is a 3 bed terraced house worth approx �120K (mortgage of �65K), we have approx �35K in savings from the sale of my property. We're hoping to start a family as soon as we're married and will therefore like at least a semi detached with garden, possibly 4 bedrooms in say 2 years time but appreciate that a baby is not cheap and therefore would like to keep our outgoings (on property) the same if not less. We'd appreciate some advice/opinions as to what would be the best option for us now:

1. sell up and buy a larger property (worth approx �35k more), keeping mortgage at �65k hoping that it will be a worthwhile investment and that property prices will continue to rise.

2. Use the 35K to pay off a large chunk of our current mortgage leaving only a �30k mortgage on a �120k house. (saving on mortgage interest). Could put money saved in to high interest savings account as deposit for the next property.

* our fixed rate term is up in April therefore we would not incur early repayment charges on mortgage but we're really looking to make a decision ASAP to avoid being ripped off by the mortgage company!

What would you do in our situation?

[Hawkwalk]

Both options are viable and your investment will be secure in both as I can not see house prices dropping any time soon.

I would reduce my mortgage by 35K and keep repayments to a minimum. Then when the time came to move there is always the option of taking that 35K back out if required or increasing your mortgage to fund another purchase.

[want2findout]

Thanks Hawkwalk.

Anyone else have any thoughts?

[chitchat]

Bear in mind all the fees you will have to pay out when you move home. Estate agents, solicitors, removals etc. I suspect your �35K will be reduced by around �5K.

If you feel that your house is too small for a family then you will probably be better off moving sooner rather than later.