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Change to buy to let or sell?

Last post Mon, Jan 19 2009, 5:08 AM by maxsteam. 1 replies.
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  •  Mon, Jan 19 2009, 5:08 AM

    Re: Change to buy to let or sell?

    First of all, you need to find what similar properties in the area are actually selling for. Some sites will give this information for free if you google around. It is not impossible that, if the price was £85k in October, there may be a similar property nearby on the market at £70k in which case you could have a long wait for a buyer at £80k.

    It is possible that, if you look for another mortgage, they will ask for a deposit of 20% - 25% minimum for a "buy to let" property. This may or may not be a problem but my feeling is that, if you've already got a good mortgage in place and if they will continue with the permission, you should stick with that. Yes, getting a mortgage without being in the UK will be difficult. Without a UK address as well, it will be close to impossible.

    If there is no time pressure for a sale, it is likely to benefit you in the long run to rent for a couple of years before looking at selling. This is just based on my view that the market is already depressed and while one or two sellers are lucky enough to find an enthusiastic buyer, there wont be enough good buyers to make selling as good an option as renting for a couple of years at least. Also, if you are putting it back onto the rental market in March, you are likely to get a better tenant if it is likely that they can stay there, with some certainty, for a decent period.

    It is worth you asking around about the implications of taking work in Australia. It is possible that a job offer could lead to you being able to change your visa. It's definitely worth talking to people as I suspect that looking for work wont be seen as a "crime" but it's certainly worth making enquiries.

    • Post Points: 5
  •  Mon, Jan 19 2009, 4:18 AM

    Change to buy to let or sell?

    I have recently moved to australia to try out life down under with my ozzie partner. I'm only on a holiday visa so cannot as yet take on permanent work. I own a property in the UK which has a mortgage of about 67k, and my provider (Scottish Widows) gave me permission to let my property out for 1 year and switch to interest only for this duration (this was in Aug). The idea was to decide in October if I would stay in oz and if so either sell the property (as the value when I left in Oct last year was about 85k), or change to a buy to let mortgage and keep it on as a longer term investment. Prices have now already come down to 80k and I’m concerned they’ll drop further so I need to start making some decisions (my current tenants are only in until March).

    My question is would I even be able to change to a buy to let mortage? Would I need a deposit – currently I have only current equity in my property which now only stands at 13k. I am only eligible for full time work from October (visas permitting of course) and my permission to let / be on interest only from SW runs out in August. Is it worth asking if this can be extended to give me time until I can move onto a permanent contract. Can I even get a buy to let mortgage in the UK if I work abroad?

    Should I just sell now and be thankful for the 13k?

    Thanks!

    • Post Points: 20