Buying up north but continue to rent in london...

LaurellaNoble

Hello just looking to get some advice...
We are a couple in our 20s. Our work and some family issues keeps us in London at the moment but long term we want to move to north Scotland where I am originally from. House prices are currently around £80-100k and we are looking at the possibility of buying sooner rather than later so we can get on the ladder.
Does anyone have any experience or know if we could obtain a mortgage (say 80k property with 20k deposit we have already saved) but also continue to rent in London (£1000 per month including all bills).

We feel that we can easily afford it as the monthly payments on the mortgage will be around 300-400 per month and at the moment we are able to save around £1000 a month after all bills, food, holidays entertainment etc.

The question is, will a bank give us a first time buyers mortgage and still allow us to rent a property in London. So our living time will be split between the 2 properties.

I am employed earning 32k per year and partner is self employed with pre-tax profits of 26k (has been self employed for 4 years and pre-tax profit rising each year).

Thanks

Crashy_Time

NE Scotland couldn`t be described as a "ladder" any more, and I doubt anywhere in North Scotland could be either. My take is that they will ask for a bigger deposit when they hear how much rent you are shelling out because you are going to choose job/family/London rent over paying a mortgage in the north of Scotland if the SHTF? Why don`t you save up some more, then you can basically do what you like.

Pixie5740

You will struggle to find a mortgage lender who will accept that you are going to maintain a residence in Scotland whilst you are currently living and working in London and your jobs will continue to be in London.

If you were able to buy the property in Scotland what would you do with it whilst you continue to live in London? Leave it sitting empty?

Crashy_Time

Pixie5740 wrote: »

You will struggle to find a mortgage lender who will accept that you are going to maintain a residence in Scotland whilst you are currently living and working in London and your jobs will continue to be in London.

If you were able to buy the property in Scotland what would you do with it whilst you continue to live in London? Leave it sitting empty?

Holiday let for people fleeing London?

LaurellaNoble

Unfortunately since we first time buyers we wouldn't be able to rent it out.
We plan to spread our time. My partner is self employed so he works all over. Plan is he can work up there half time and work in london the other half. I can also do 2/3 time in london 1/3 up in scotland.
Yes, NE scotland is a crappy area but...I grew up there until age 20 and my entire family still live there so it's where we want to be. It may sound odd to some people but we are happy to buy a 2 bed house up there and staying put. We don't have a desire to then upgrade to bigger and bigger houses since we don't like or want children and adding to that we won't have to worry about passing any property down etc. so we don't care about the re-sale value etc since we just want a place to call home.
We just want to hurry up and buy something before prices and interest rates change...

Pixie5740

By all means go and speak with a mortgage lender but I personally think you will struggle to get a mortgage in your circumstances.

Edit: There is a specific board on the forum called "Mortgages & Endowments" so you could ask your question there. A few mortgage brokers regularly post on that board.

LaurellaNoble

Okay thanks for the tip. I will try asking in that forum.
We will think about our options...maybe we need to just be patient and not be focused on buying asap. Will consider saving up a larger deposit.

Crashy_Time

LaurellaNoble wrote: »

Unfortunately since we first time buyers we wouldn't be able to rent it out.
We plan to spread our time. My partner is self employed so he works all over. Plan is he can work up there half time and work in london the other half. I can also do 2/3 time in london 1/3 up in scotland.
Yes, NE scotland is a crappy area but...I grew up there until age 20 and my entire family still live there so it's where we want to be. It may sound odd to some people but we are happy to buy a 2 bed house up there and staying put. We don't have a desire to then upgrade to bigger and bigger houses since we don't like or want children and adding to that we won't have to worry about passing any property down etc. so we don't care about the re-sale value etc since we just want a place to call home.
We just want to hurry up and buy something before prices and interest rates change...

NE Scotland is a totally different ball game to N Scotland though, that was until recently probably the wealthiest area outside London (depending on your job) in the UK. Much more downside to come for Aberdeenshire property, and will go lower if rates rise, where further North has probably been stable at lowish prices for years? Why not wait for a distressed sale and get a better deal?

LaurellaNoble

Yes it is Aberdeenshire area (but not Aberdeen) we are interested in.
We'll hold out and save up a bigger deposit then...

bitsandpieces

I don't know if prices will go up or down where you're looking, but if you're saving £12k/year and looking at sub-£100k places then it would take really big rises before you fall behind the market. On the other hand, if prices just rise slowly (or, better for you, are stable/fall) you'll be able to buy in a couple of years with a notably smaller % mortgage - which will also mitigate against at least some of the risk of interest rate changes. You may also benefit from government subsidies via a help to buy isa?

It depends on your appetite for risk (and how a purchase fits into your lifestyle more broadly), but it's worth giving serious thought to how likely you are to be in a better position if you buy some while down the line. There are always uncertainties - and if you want to be *sure* you can buy somewhere then speaking to a broker about a mortgage now may be your best bet - but it's worth considering the costs of this vs renting/using airbnb when you visit.