To buy or not to buy?

becky4131

I have just sold my appartment (about to exchange contracts) and i am all set to go backpacking around Australia for 12 months.
I will have made a small profit after fees and im planning on putting this in a savings account along with the initial deposit i put down on the flat ( i should have about £20,000) ready for buying another property when i get back from my travels.

I will be working casually in Australia but because im out of permanant work for the next 12 months will i have to work for 12 months when getting back in the UK before mortgage companies will consider me?

This worries me slightly and considering buying a house before i go and renting it out whilst im away even though i didn't really want the hassle of this whilst being the other side of the world.
Don't really want to end up in rented for 12 months when im back and risk getting priced out of the market if interest rates rise.

ethank

Mortgages are based on affordability. If you have no income, you will find it difficult to obtain a mortgage. Can you prove you can service a mortgage without a job?

pawpurrs

You don't need to be in employment 12 mths, some mortgage companies will consider after one month.
You could always rent the property you already have, although should have been considered earlier.

The_Palmist

If they want to see proof of income, they would usually ask for last 3 months wage slips, in some cases they may accept your contract of employment.

Running_Horse

That's how bubbles work. Buy now or miss out forever! Having seen it several times I am naturally sceptical, but maybe this time it really is different. If you want the freedom to travel and see the world then hopping on and off the housing ladder may not be for you. Only you can decide if being a landlord is for you, just don't fall for the hype.

becky4131

Thanks for the replies

Its good news about not needing a full 12 months wage slips, i will of course be in rented until the 'right' property comes along so might be months anyway.

I did look into renting current property but its a leasehold flat bought through a government scheme that unfortunatly has a clause where i can't sublet. My only option if i wanted to do some travelling was to sell so that is what i have done. I am nervous to step off the property market but i do not want to be a landlord really and hopefully time in future to buy another property when ive done the travelling.

Turnbull2000

Aren't BTL lenders easing up on conditions, including the income requirements? Prices in London and the South East will likely rise 10% over the next 12 months, so you could lose out my a decent amount (tens of thousands) if you wait rather than buy and let out.

For the other regions, price growth should be more modest from a relatively cheap base, so perhaps not worth panic buying.

allthingsmustpass

becky4131 wrote: »

Don't really want to end up in rented for 12 months when im back and risk getting priced out of the market if interest rates rise.

When rates rise you should expect prices to fall. It could turn out rather fortunate for you if that happens this year as you can buy back in for less!

You might get lucky, and you might not.

In either case consider how it could be possible for property to be completely unaffordable when you return, how will anyone sell if that happens?

Enjoy your trip. If you want to do more things like this in the future perhaps renting is better when you return.