I wrote recently about buying a house as a single parent (TL:DR – it’s really, really hard) but this week I want to share the exciting news that we are about to move in to our new home. and for lots of reasons, it’s a home worth $1 million. [note – I usually share my figures in £ but it sounds better in dollars so I am doing it, just this once].
Side note: I was talking to a married friend about this and she said ‘but why do you keep saying WE bought a house? I mean, you’re doing it alone’. In mentally wrestling with this I can’t decide if it makes me feel annoyed since my family unit counts as a ‘we’ since it isn’t a pronoun that couples somehow own. Or perhaps she meant it in a kindly way to recognise the challenges. Either way, it’s the kind of comment which wastes my mental space so I share it with you here in the hope that I can then forget about it. In case it stays confusing, ‘we’ in our case means myself and my children. Plus I promised that we can get a cat, so the moggy counts too.
So, we bought a house! I wrote back in November about planning to do this, a post which built on three months of decision making since our landlord told us that – like many people during COVID – had decided that they wanted to move back home. It has been a long long process since then, and it has meant putting other financial goals on the backburner. Plus actually it has been stressful and knackering, but since we had to move out anyway some of this was unavoidable.
I shared this before but if you are really interested in the nuts and bolts of buying a house in Denmark you need this fantastic and very detailed guide, but below are the steps that I took as a British expat:
1. Had a browse of the market. This was the point when I realised what kind of price band we were looking at. We wanted a house with a garden, in the suburbs, with four bedrooms and some separated space (i.e. not a single storey) so that there is room to have childcare support who can stay over, and within walking distance to the train which will take us to work and school. Unfortunately this is what pretty much everyone else is looking for especially post-COVID, driving up the speed of the market and house prices. But this was a useful step as it showed me the kind of thing that was available and the amount of mortgage I would need to make it work.
2. Looked for a mortgage. In Denmark, there aren’t really mortgage brokers which means you have to do all the legwork yourself. In the end I used a broker who specialises in working with expats since, not surprisingly, all the paperwork including the surveys are all in Danish. The first calls I made to banks showed that I was eligible for a mortgage but as an expat I would need a 20% deposit – or to find, up front, about £155,000. It is testament to how much I wanted to get out of paying our extortionate rent that I looked into remortgaging my UK home in order to find this deposit. I couldn’t make this work (for lots of reasons though I did find one broker who would do it, it came with conditions I didn’t want to accept) so I went to the Danish broker. They found me a mortgage with a 10% deposit (where the bank provides the 80% mortgage still but then also grants a 10% loan). In the end this was a saving grace since it made me stick to a lower overall budget. And let’s be frank, that was still a budget of $1m which makes me twitch just a little every time I think about it.
3. Made some hard financial decisions. The 10% requirement means that I had to find £80,000 for the deposit. I was able to do this by pulling various savings and investments. I took out almost my whole £40,000 emergency fund leaving just £3,000. I also pulled money from investments – with stocks and shares ISA there’s no fees or penalties to take money out, but I withdrew a lot and left £12,000. I really reflected for a long time on whether this was a good idea, since it took a lot to build up those pots of money, but looking at the balance of risk I think that we stand to be better off in the long run unless a black swan event turns up. And we might have had enough of those for a while….
4. Looked for a house. Oh. My. Goodness. this was the painful bit. Being a) on a tight budget (for Copenhagen) and b) quite detail oriented, I ended up looking at 40 houses. I made offers on two, both of which were rejected – one where someone else beat us to it, and one where the survey showed it needed a new roof and the owners wouldn’t accept a lower offer based on the money needed to do that. But, after spending every weekend for months looking at houses, we finally found a house that fits the bill. Hurray!
5. Did all the paperwork and processes. This is pretty easy in Denmark thankfully – the bank also has amazing processes where they organise paying over the mortgage at the right moments which also removes the possibility of getting scammed which scared me witless when buying my UK home. You have to have home insurance in place, and a kind of insurance which protects everyone in case there is something that the house survey has missed.
6. Made my peace with the compromises. So I am not quite there with this one, but it’s coming. We had to move further out than I would have wanted, and to a slightly different part of town to where we are now (and where our friends are). We are at the top end of my ‘distance from train’ condition, ditto ‘size of garden’. But I am hopeful that once we settle in and stop comparing to where we are now, I’ll forget about these things and enjoy our new home in peace.
So there we go. I post on Sundays, and this time next week (all being well) we will have the new house and be sorting it out – the weekend after we will be all moved in. Wish us luck!