Want to buy my first flat, but might move overseas after a year

ewliin

I'm prevaricating about taking my first plunge into the housing market as a first time buyer, and grateful for some advice.  I hope this is the right sub-forum as the main potential complications are (as far as I can tell) mortgage-related, although I guess it's also from a broader financial planning perspective.

The short version:   
I want to buy a flat for myself as a first time buyer (with LTV ~65%), but might be moving overseas for work after a year or two of buying it, at which point I would want to rent it out until I return (I'd likely be overseas for 3-4 yrs).  How big of a spanner in the works is this?  Should I be broaching this with potential lenders now, or cross that bridge when it comes to it?

The detail:
My budget is £350k-400k with a LTV around 63%-70% (unfortunately I can't quite get below the magic 60% without compromising too far on my budget).  I'd be looking for a 1 or 2 bed in London.

Seems like a no-brainer and a great position to be in as a first-time buyer, but the reason that it is more complicated is that, because of my job, there is a strong likelihood that I will move overseas for 3-4 years in 2022 or 2023, and long term will have a pattern of a few years in London, then a few years overseas, so on and so forth.

I am hoping to understand how this may or may not complicate things with a mortgage.  While I am overseas I could still afford my mortgage payments without renting it out (employer provides free accommodation overseas), but obviously I would rather rent it out.  What I can't get a sense of is how much this might scupper my plans or end up costing me more than it is worth, or I'll end up stuck without being able to gain consent from my lender (and I am not 100% clear if it would require a re-mortgage to a BTL mortgage). 

Obviously this is more than a pure financial decision - there are personal reasons why I am inclined towards buying rather than continuing to rent while my savings accumulate.

Any advice very gratefully received..!

K_S

@ewliin If you do buy a flat to live in and then need to move overseas temporarily in a year or two, your lender should be ok giving you 'consent to let' as long as you intend to come back at some point. For some lenders this means a one-off / periodic fee, others might tack on an interest rate surcharge (eg Nationwide will add on 1% after 6 months), and others will not allow you to switch products once you are on a CTL so when a fix ends you could end up stuck on a much higher SVR. Every lender has their own quirks around consent to let.

I started off working as a broker in Canary Wharf many moons ago and a lot of my clients were mobile in the way outlined in your post, I've never heard of any of them being denied consent to let when moving temporarily overseas, it's not a particularly uncommon scenario.

davidmcn

Would you be planning to move back into your property when you return? Bear in mind that might not be straightforward (as many landlords are currently discovering) - it's not exactly easy to swiftly remove tenants at the best of times, and nearly impossible at the moment. You may be better off renting rather than have the hassle/expense of being an absentee landlord.

ewliin

K_S said:

@ewliin If you do buy a flat to live in and then need to move overseas temporarily in a year or two, your lender should be ok giving you 'consent to let' as long as you intend to come back at some point. For some lenders this means a one-off / periodic fee, others might tack on an interest rate surcharge (eg Nationwide will add on 1% after 6 months), and others will not allow you to switch products once you are on a CTL so when a fix ends you could end up stuck on a much higher SVR. Every lender has their own quirks around consent to let.

I started off working as a broker in Canary Wharf many moons ago and a lot of my clients were mobile in the way outlined in your post, I've never heard of any of them being denied consent to let when moving temporarily overseas, it's not a particularly uncommon scenario.

Thanks.  This is helpful, and somewhat re-assuring.  

davidmcn said:

Would you be planning to move back into your property when you return? Bear in mind that might not be straightforward (as many landlords are currently discovering) - it's not exactly easy to swiftly remove tenants at the best of times, and nearly impossible at the moment. You may be better off renting rather than have the hassle/expense of being an absentee landlord.

Thanks.  It's a good point.  If I do go overseas, I'd be gone for a couple of years and I would know probably over a year in advance when I am due back, which would enable me to agree either a fixed term tenancy ending at an appropriate time and/or start the Section 21 process far enough in advance to allow for court etc if it ended up being a tenant that did not wish to move out even when served valid notice.