Should I stay or should I go? Moving v improving

Is now the time to move up the housing ladder?

The current economic climate has presented a range of challenges to homeowners, perhaps most notably in whether they ought to advance up the housing ladder or stay in their current property and improve it. Although there is a case for doing either of these, no matter which you choose it is a good idea to use a mortgage calculator.

Such a tool can prove incredibly useful in a number of ways - from enabling you to figure out how much your monthly mortgage payments will be to what impact a change in interest rates will have on your finances - indeed, it could be that using a calculator helps you to make the decision between whether to stay put or up sticks and move house.

Given the global financial crisis of recent years, it is perhaps unsurprising that many people have been choosing to do the former where they may have once moved. Property prices across the entire country have plummeted and many banks and building societies have tightened up their lending criteria in a bid to reduce the risk of borrowers defaulting on their loan repayments.

An added consequence of the downturn is that many people have suffered from salary freezes and reduced hours - something that has subsequently put pressure on their finances and made generating enough cash to buy a new home a difficult task.

With a significant proportion of Britons set to stay in their current homes for longer than they originally intended, it may be an idea to consider making improvements to your house.

Doing so can leave you with a property that is much more comfortable to live in. Should you make energy-efficiency improvements, for instance fitting a new boiler or adding cavity wall insulation, you will also discover the cost of heating and lighting up your home will fall.

Perhaps the most effective property improvements are fitting a new kitchen and bathroom. These are two of the most used communal parts of a home, so investing cash into renovating them could make your place more practical to use and give a greater sense of aesthetic appeal.

Of course, the amount of money home improvements will cost you will depend on the nature of the work you want doing. However, while making substantial structural changes can amount to several thousand pounds, as a general rule it will cost you far less and avoid much of the hassle that can come with buying a new property.

For major projects, it may an idea to get your home remortgaged to raise the cash required to complete the work. If this is an option, using a mortgage calculator will help to ensure you're taking out a competitive deal.

Such work can also boost the overall value of your property, so if you decide you want to move at a later date you may be able to command a higher price for your home!

However, there is still a significant case for why you may be looking to buy a new home.

The fact you are already on the housing ladder means that - unlike first-time buyers - you don't need to save up for months on end to raise the deposit for a new place, the cash raised from your current home is normally enough for a down payment.

Of course, that isn't to say the process of moving home won't cost you a penny - there are still things like valuation costs and legal fees to be paid - but you won't have to worry about one of the biggest problems currently preventing many people from taking their first steps on to the property ladder.

The fact that prices across many areas have plummeted in recent years can also put you in a position of power - using your mortgage as a bargaining tool when making an offer - when attempting to negotiate a good price on a new home.

It is also worth bearing in mind that although improving a property can provide you with more room, there are quite often limitations to how much you can do. Remember you will be constrained by the level - if any - of planning permission you need from your local council. Depending on what you want from a home, there are times where moving to a new property is simply the only way for you to obtain the space you need.

Take the above points into consideration and you should be able to make an informed decision on whether to stay in your current home and improve it or take the plunge and buy a new property. In either case, using a mortgage calculator should enable you to keep a tight rein over your finances.

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