Buy before going abroad for work, or keep saving?

nm123_2

I'm waiting to hear whether I'll be transferred abroad for work for 1-2 years. At the moment, OH and I have about £30k in savings and we're wondering whether it would be best to buy somewhere before we go, or keep saving whilst we're away and wait until we get back.

Planning on going abroad in Feb-ish time.

We could use about £15-20k for a 10% deposit on a flat right now and still have a cushion for whilst we're away. I'd be keen to get this sorted by the end of the year to take advantage of the no-stamp-duty thing, and also so that we could live in the flat before asking the mortgage provider for consent-to-let.

If we weren't going away, we'd probably save for another year and have £50k to put down on a 3 bed house.

Additionally, we'd probably like to start a family when we get back. I'm not adverse to having a baby in a flat intially, but ultimately, we're keen to get into a house that we can call our own and actually live in. Not fussed so much about having a property as an investment, more wondering if buying now would put us in better stead for our longer term goal of a house.

Pros and cons of buying somewhere before we go:

+ We get on the property ladder (whatever that is these days :rolleyes:).
+ We could rent it out whilst we're away and have at least most of the mortgage covered (have a tenant in mind - my step-sister).
+ Potential to store stuff / let the flat part-furnished.
+ We'd have somewhere to live when we got back that would do us for a while.
+ Perhaps an increase in property value.

- We can't get a consent to let.
- The hassle of becoming landlords.
- Won't be our "dream" property, just more for functional purposes (as in the +'s above)
- Cost of selling/moving.

Pros and cons of not buying somewhere before we go:

+ No hassle of being landlords whilst we're away.

- We have nowhere to move into when we get home, expense of renting, then perhaps moving again.
- Nowhere to store things like sofa and TV.
- We don't save that much while we're away due to cost of living abroad / FX rates etc.
- Credit rating negatively affected from being away (not sure on this?)
- OH is self-employed and only has 1 year of accounts at the mo, he'd have even less when we got back.
- Perhaps property will de-value.

Any advice on what we should do??

Many thanks in advance.

Fire_Fox

What if you don't get consent to let? 10% deposit may not be enough and you may well not have completed the sale much before February! What if you have tenants that don't pay and need to be evicted or cause a lot of damage? Can you pay the mortgage for six months? Have you factored in service charges, management fees, income tax, capital gains tax, costs of buying and selling?

mlz1413

Your going away for 1-2 years enjoy it with no hassles!

My thoughts are:
Do not start a business you have never tried before when you won't be in the same country.

Interest rates may not stay the same and a general election is coming - both things that could affect your mortgage, rental, house prices.

I wouldn't buy a flat just to have a 'footing' in the UK. Renting for 6 months is not that expensive and it takes approx 3 months to buy so its not a longtime.

Do you really want the same sofa and TV when you get back in 2 yrs time?

Being commitment free means you can move to anywhere you like when your contract ends.

gmgmgm

I've considered this in the past as well and come to the conclusion it's better not to have a property to manage and worry over in the UK while working abroad.

Being an absent landlord is not an easy task- as these forums show.

getmore4less

If you like the international life you may not come back,

agree with the others keep saving enjoy the trip sort out housing whem /if you come back.

Check out your employers package first there may be insentives that make buying more worth while but still a potential nightmare if it goes wrong.


The other issue is that you get a place rent it out then find the secondment does not happen or ends sooner than you thought.

woops now you have to rent somewhere.

nm123_2

Fire_Fox wrote: »

What if you don't get consent to let? 10% deposit may not be enough and you may well not have completed the sale much before February! What if you have tenants that don't pay and need to be evicted or cause a lot of damage? Can you pay the mortgage for six months? Have you factored in service charges, management fees, income tax, capital gains tax, costs of buying and selling?

Eeek, I'd hope to get the sale done before the end of the year to avoid the stamp duty.

I've read lots of forums where people have wondered if they can get away with not getting a Consent to Let, but what if my step-sister and her family were just house-sitting for me? Mortgage is still paid by direct debit to lender........ Just thinking out loud...

Is it likely that I wouldn't get a CTL?

We could afford the mortgage for 6 months, begrudgingly.

I must say I'm almost more inclined to not bother and stick our savings somewhere decent and wait until we get back. But, OH still won't be a decent mortgage applicant if he comes back and is self-employed with less than 1 year of accounts! Essentially we'll be in the same position we're in now but just with bigger savings - ie still unlikely to get a 3 bed house on just my salary.

Perhaps all this is just nice in theory, but more hassle than its worth in reality :rolleyes:

nm123_2

mlz1413 wrote: »

Your going away for 1-2 years enjoy it with no hassles!

My thoughts are:
Do not start a business you have never tried before when you won't be in the same country.

Interest rates may not stay the same and a general election is coming - both things that could affect your mortgage, rental, house prices.

I wouldn't buy a flat just to have a 'footing' in the UK. Renting for 6 months is not that expensive and it takes approx 3 months to buy so its not a longtime.

Do you really want the same sofa and TV when you get back in 2 yrs time?

Being commitment free means you can move to anywhere you like when your contract ends.

I guess so. I was expecting it could give us more financial freedom in the long run, but perhaps being commitment-free whilst we're away would actually be more worthwhile overall, and longer-term.

nm123_2

getmore4less wrote: »

If you like the international life you may not come back,

agree with the others keep saving enjoy the trip sort out housing whem /if you come back.

Check out your employers package first there may be insentives that make buying more worth while but still a potential nightmare if it goes wrong.


The other issue is that you get a place rent it out then find the secondment does not happen or ends sooner than you thought.

woops now you have to rent somewhere.

No incentives through work.... I thought renting to family might provide more flexibility in terms of giving notice etc....

spudnik

First off this happened to us, we are half way through a 2 year contract.

We didn't buy before we left. We had similar savings to you.

Pros and cons of buying somewhere before we go:

+ We get on the property ladder (whatever that is these days :rolleyes:).

+ We could rent it out whilst we're away and have at least most of the mortgage covered (have a tenant in mind - my step-sister). The Tax returns are hell on earth and we don't have a house in the uk and a specialist company does it for us and it is still a MAJOR pain.

+ Potential to store stuff / let the flat part-furnished. Would your tenant really want your stuff there ? and would you want your stuff left in the tennants hands ? you could come home and have to buy new if it gets wrecked

+ We'd have somewhere to live when we got back that would do us for a while.

+ Perhaps an increase in property value. Personally i think the market will stagnate

- Cost of selling/moving. You'll have to weigh this against your saving rates

- We have nowhere to move into when we get home, expense of renting, then perhaps moving again. Now this is a big one we are planning on starting a house search before we come home and setting the process in motion and coming home using up some holidays to sort stuff out so hopefully a few mths of sleeping at our parents and we will be sorted not ideal.

Nowhere to store things like sofa and TV.
Possibly do what we did, the company should offer you a relocation package which will include a shipping allowance, we took the cash instead, sold all our belongings and then re bought them when we got here in the end we spent less than the shipping allowance. BUT all our belongings were second hand and we had no particular attachment to them.

- We don't save that much while we're away due to cost of living abroad / FX rates etc.
Factor in the fact that one of you may not be able to work which is what we only found out when we got here

- Credit rating negatively affected from being away (not sure on this?)
We sorted this buy using a UK credit card for all our food shopping so we still have a uk credit rating yes it does cost us and you will nedd to factor that in.


- OH is self-employed and only has 1 year of accounts at the mo, he'd have even less when we got back.
This is another big one through not being able to work over here when we get back the mortgage will have to be based on just OH wage. So that would depend on your local house prices

Good luck whatever you decide.

nm123_2

spudnik wrote: »

First off this happened to us, we are half way through a 2 year contract.

We didn't buy before we left. We had similar savings to you.

Pros and cons of buying somewhere before we go:

+ We get on the property ladder (whatever that is these days :rolleyes:).

+ We could rent it out whilst we're away and have at least most of the mortgage covered (have a tenant in mind - my step-sister). The Tax returns are hell on earth and we don't have a house in the uk and a specialist company does it for us and it is still a MAJOR pain.
We'll have a tax advisor doing this for us, but get your point.

+ Potential to store stuff / let the flat part-furnished. Would your tenant really want your stuff there ? and would you want your stuff left in the tennants hands ? you could come home and have to buy new if it gets wrecked
Possibly, my step-sister isn't flush and would welcome a nice telly and sofa for a couple of years. I think we'd write off any damage to the sofa as it's already a couple of years old, and the telly was new this year, so we could come to an agreement if it was damaged.

+ We'd have somewhere to live when we got back that would do us for a while.

+ Perhaps an increase in property value. Personally i think the market will stagnate
Hope so!

- Cost of selling/moving. You'll have to weigh this against your saving rates

- We have nowhere to move into when we get home, expense of renting, then perhaps moving again. Now this is a big one we are planning on starting a house search before we come home and setting the process in motion and coming home using up some holidays to sort stuff out so hopefully a few mths of sleeping at our parents and we will be sorted not ideal.
We'll be in Australia, so no chance of popping home! We went travelling a few years back and had to move back in with our parents when we got home and it's not an experience we'd like to repeat. Saying that, friends have offered to house us temporarily if it comes to it.


Nowhere to store things like sofa and TV.
Possibly do what we did, the company should offer you a relocation package which will include a shipping allowance, we took the cash instead, sold all our belongings and then re bought them when we got here in the end we spent less than the shipping allowance. BUT all our belongings were second hand and we had no particular attachment to them.
No relo package (tax, immigration and healthcare only) as this is a personal request.

- We don't save that much while we're away due to cost of living abroad / FX rates etc.
Factor in the fact that one of you may not be able to work which is what we only found out when we got here
Good advice, thank you. I guess it wouldn't be the end of the world if we don't continue to save at the current rate.

- Credit rating negatively affected from being away (not sure on this?)
We sorted this buy using a UK credit card for all our food shopping so we still have a uk credit rating yes it does cost us and you will nedd to factor that in.Good advice, thank you.


- OH is self-employed and only has 1 year of accounts at the mo, he'd have even less when we got back.
This is another big one through not being able to work over here when we get back the mortgage will have to be based on just OH wage. So that would depend on your local house prices
This part is a whole different issue - it's either stay here, keep renting and saving where we are and let OH build up more years of accounts, or go to Oz. The wanderlust in both of us is bigger than our ability to buy a house right now, so we'd rather have a lower savings rate for the next 1-2 years but fun in Sydney doing it.

Good luck whatever you decide.

Thanks very much.

puddy

ive never had the desire to live anywhere else or travel/backpack, but for people that do, its important to them. i imagine that you are young (under 30 or even 25?) and if so, just do it, there is plenty of time to buy something, have fun, save as hard as you can whilst still having fun and review your plans when and if you do come back, its hard enough owing a home with everything that needs doing, dont do that via telephone and fax/email