Downsizing plan: buy first, sell a year later, then clear mortgage – any pitfalls?

Soulgreen

@born_again - we're mid 50's but sadly my husband has health issues so we're manouvering ourselves into semi retirement earlier than planned. Spoke to our Premier Banking advisor at Barclays last week and they ran figures on a 22 year advance and seemed to think it would all be ok. He said they often go up to age 85 these days! Which I admit I was surprised to hear.

SarahB16

Another option is to try to rent a place in the countryside location you are considering buying the apartment in. Then you will really get to know the area and people and can share your intention with the locals and hear tips on the exact location to buy in, etc. What happens if you don't like the place? Would it be easy to sell that apartment? Would it be better to rent for a year first (rather than buying that apartment) and keep your house too until you are definitely decided on where you wish to retire to?

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/82042966#Comment_82042966

Yes Barclays is a bit of an outlier with their age 85 cessation point for their mortgages, they gave me one to age 83 when aged 66 but would have extended to age 85 if I wanted.

Dustyevsky

https://forums.moneysavingexpert.com/discussion/comment/82042973#Comment_82042973

I would second that. A complex close to me has a number of reluctant landlords who bought thinking they would like the quiet life. Some didn't, while others had a change of circumstances. Either way, they found the properties, which do have very small gardens, hard to shift at the sort of prices they paid during/immediately after Covid.

HHarry

We did exactly this 4 years ago. I would do it again today, but financially it was very stressful.

We mortgaged on a SVR so there would be no early repayment charge - and then intrest rates shot up from next to nothing to nearly 5%. Getting a letter on a near monthly basis with another significant rise in monthly payment was depressing. A fixed rate and paying the ERC would have been cheaper - hindsight is wonderful!

You need to have the income, or capital, to run 2 houses. The fact that you’re only using one at a time doesn’t make anything cheaper. You’ll have 2 running costs and for the house you’re selling no control over how long for.

The cost of running a house that you’re selling and not using can be quite depressing - like you’re throwing money away. You might feel a bit of pressure to accept any offer, just to stop paying the bills, even if it’s not the best or fairest offer.

But….it worked out Ok for us in the end, and I hope it does for you.