Great points. I’m at the stage where my kids have left home so just hubby and I left. We’re in our 50s with our mortgage due to be paid off at 70. We’ve had a quote to demolish house and rebuild to our spec for the same money as all four options BUT we have a malicious neighbour who I know would block all plans and cost us a lot more money just to get the plans through so I’m not even looking at that as an option which is a shame. We love the area and would stay here. Have seen a block of land at the back of our house but it’s on a slope so site works would cost $$$$s. We’re also on a fixed mortgage for another 15 months so would have exit fees to pay if we paid off any part of our mortgage.

If you sell your house AND use the cash windfall, would you able to buy a better house, and have the same mortgage.
Then your situation has improved, with no extra financial stress.
Why did you put a pool in, if there was so much work to be done to your home?

Okay, we crossed posts.
I would be putting as much money as allowed onto my mortgage. I would set up an offset account, to reduce the Interest calculated. I would be doing my best to pay my mortgage off as soon as allowed. I would not want a mortgage into my sixtys.

15 months isn't long: barely enough time to research and plan some improvements but so many other questions: would the house be suitable for old age after improvements? is the windfall enough to do major works? imo the difference between overcapitalising and investing is only time and if you're happy to live in the house for ever then money "wasted" on your home comforts is much better value than an overseas holiday ...(we just spent refunded holiday money to install AC) and is the difficult neighbour likely to be there forever? the nearby block of land may also have a difficult neighbour..so, it sound like the staged renovations might be the least dramatic option and if the house is only 30 years old i'm hoping that it is in safe habitable condition but i'm now curious to see your plans and learn what you think needs fixing

Unfortunately I bought my house at the peak so if I sold now, I’d come out with nothing. So any work done to it, based on current values, would definitely be overcapitalising. If renovated though the house would suit us for the rest of our lives. The difficult neighbour is definitely impacting the quality of my life and is quite a big factor in wanting to move. Without them we’d stay and renovate for sure. But they’re been there for 12 years and show no sign of moving 😢
The pool was installed 12 years ago before everything else started falling apart lol.
The plans we have are replacing all the windows and doors, new kitchen, flooring, shower screens, plasterboard the brick and install insulation. Hubby also wants the driveway redone, garage floor concreted and wants double glazing as we live near the coast. I have costed it all and we won’t see much change from $300k. Current house value is $400k. We’ve also had plans drawn up for the addition of a second storey but the price for that is eye watering

then why not make a list of the improvements and start chipping away at the ones that will is the easiest to achieve, give the most personal comfort immediately and potentially offer the best return if you decide to sell..do you have enough extra money for the new kitchen, painting over the bricks and roof insulation? and i'm wondering if the conflict with neighbours has changed over time and how that can be resolved or ignored..eg once we didn't have kids to interact with neighbours there was no more conflict with neighbours

I think you should seriously think of moving for that sort of cost as the neighbour impact is not good. But really look at buying in your means. Smaller more comfortable house may be better. If you house is valued at 400$ and you add $300 that seems crazy as will it really be valued at 700 when you finish? Go talk to some real estate agents first

I’ve had a few real estate agents round who’ve actually said it’s not worth spending the money on the house as it’ll not be recouped at any point in the near future. We paid over $500k for the house 14 years ago so we’ve already ‘lost’ money as it were. If we spent the $300k the absolute maximum we’d get if someone loved the place would be $500k so it doesn’t make financial sense to renovate for sure.
The reason buying a new house would raise the mortgage is because we’d want to live closer to the beach as otherwise we wouldn’t want to move.
The neighbour conflict has only changed a bit over time since the rangers no longer act on each and every call that they make to them. But even just the sight of them raises my anxiety levels as I have no idea what’s coming next. That being said, if we moved, we may get new bad neighbours !

Your neighbours sound horrid and stressful. Unfortunately, you can't renovate them away. Don't throw away good money after bad. Make the decision to move and spend as little as possible to make the house saleworthy. Say goodbye to your old neighbours, and hello to your nice new neighbours. I would like to think that there are more good neighbours than bad neighbours out there. There is no such thing as the perfect house, but good neighbours are easier to find than bad neighbours!

Best of luck with your considerations,

Dr Retro of Dr Retro House Calls/Dr Retro Virtual Visits

Heather, in all of your comments you have mentioned the bad neighbours and the stress they are causing.
I think your answer is there, in your comments. You can not change your neighbours, but you can change your address.
If you look in the same suburb then the prices of houses for sale are relevant, to that, suburbs market. Therefore you may be able to find a home that needs small renovations but in a more comfortable street, for your budget.

Thanks everyone ...... I keep hoping that the neighbours move or a miracle happens and they either become nice or just ignore us but I think I'm coming to terms with the fact that it's never going to happen. Hubby doesn't want to move as he has his perfect size garage but I think we need to talk lol

could you make the deadline for a decision the 15 months you have to wait to pay off the mortgage without penalty

That’s a good point. I could give it a go !!

Cut your losses and move soon