Moving from London to the North - Advice needed on what to do with properties.

fraser93

My partner and I are considering moving out of London. I have been offered a new job that can be based from either London, the North West or Scotland and my mother-in-law has recently passed away. My partner and I are considering moving North to be closer to my partner's father to support and care for him more in older age. We each own a flat separately with a single person's mortgage (mine has a Help to Buy equity loan attached).

Property 1 - I have a mortgage of 175k and help to buy equity loan of 134k on a flat that was bought for 335k in September 2021.

Property 2 - My partner owns a property that he is currently renovating and planning to sell on. He has owned the property for 5 years and has approximately 130k built up in equity on it from 5 years of mortgage repayments, an initial deposit of 60k and an estimated increase in the market value of the property of about 55k.

I have considered requesting a consent to let on property 1 to let out for the remaining period of the fixed term mortgage period and then turning this into a joint buy to let mortgage when remortgaging. By remortgaging on a joint buy to let I could pay off the equity loan and via an expected annual rental income of 15-18k (before tax) would easily cover the cost of mortgage repayments and enable us to keep the property if either of us ever needed to move to London for work postings (for the next couple of years) and then after my current fixed term mortgage repayment is up in 2026 as an appreciating asset to fund our retirement either through selling or living off the rental income when the mortgage is repaid. Leaving the equity and my partner's 5 year fixed term mortgage to be transferred to buying a 'doer upper' property up North - property 3. Once settled and after property 1 is remortgaged to a joint buy to let mortgage in 2026 we could then sell property 3 and use the equity made from that to buy a larger property up north on a joint mortgage. Meaning that we'd end up with joint ownership of property 1 and property 2.

Another, perhaps more straight forward option would be to consolidate, sell both London properties and take out a joint mortgage on a larger single property.

Does anyone see any flaws with this plan or who has been in a similar position that can offer any advice please?

Thanks.

Choirgrl

Two thoughts:
1. Given the differences between the housing markets in London and the North West, I see benefits in keeping a foot in the London market if you can (especially if there is any chance you might need / want to move back in the future)

2. Have you considered initially renting in the NW? That would give you chance to be sure the new job works out, test location in relation to your FIL and have a bit more space to work out the overall financial picture and what works for the type of property you decide you want to buy.

fraser93

Yes I have. We could do that initially before selling either flat in London and just getting a consent to let on the each mortgage for the short term.

I would need to secure agreement from homes England before hand. Has anyone got any experience of letting out a help to buy property in this way. 

youth_leader

I agree with keeping a property in London.  We moved to the NE with my husband's promotion, and now widowed, I cannot afford to go back.  

SuseOrm

Even trying to move back to Birmingham from the north west was a struggle unless you’re gonna go for somewhere like Bowden, alringham, Wilmslow etcthat actually aren’t far off London prices these days.