Looking for some advice regarding property
Hi guys,
I'm in my late 20's. I am a single person who no dependants. I own a 1 bed flat outright in Manchester which is worth around £90,000 (I didn't have much of a life during my formative years so just worked and saved). I rent it out at £750 a month, and I rent in London as I work here. I don't have much in savings, and I currently do an apprenticeship, so my salary isn't the best.
I make £25,000 a year, which isn't much especially at my age, but as I'm doing an apprenticeship I suppose it's the best choice I have. I have the rental income of £676 (after estate agent management fees).
So I make around £34,000 a year, minus taxes and service charge it's more like £30k.
I don't like renting at all, it feels like money is just being burnt and would like a place. I actually found a really small 1 bed flat in an areathat I really like (I also like the area quite a lot). The issue is, it's £200,000 for a 33 sq m flat.
It's a really cheap flat but….. I don’t know what to do in terms of affordability. I could sell the Manchester flat and buy the flat in London. I could move back to Manchester and work a normal job, and not have to worry about bills barring utilities.
The other thing I'd like to ask is this: If I put a deposit down of £25,000, could I ask for a mortgage of £175,000 using my flat as collateral?
I hope this isn't too confusing.
TLDR:
- I make £34,000 per year (my contract expires in December 2026), have £30k in saving, and I'm looking to buy a property that is worth £200,000
- The property is fairly small, it is 33 square metres and 1 bedroom.
- I have a flat in Manchester, worth around £100,000, I could sell this and then possibly mortgage the rest?
- Alternatively, I would put down a deposit of £25,000 and mortgage the rest, using my flat as collateral in Manchester? Would this be possible?
- Forget the property altogether and just focus on saving money whilst renting and buy a bigger property altogether?
Sorry if I sound a bit lost, I am.