We’ve published articles detailing ways Britons can make their dream of a new life abroad a reality even in these troubled financial times – and we often cite the fact that you don’t necessarily have to sell your home in the UK before you go. When the property market was booming pre-2007 and you could sell easily and profitably, many Britons used their home’s equity to fuel their new lifestyle overseas, but nowadays if you want to expatriate you have to be creative!
It is harder for many people to escape to live the dream, but it can still be done even if your home is lolling unsold on the property market in Britain. One way you could make sure your mortgage commitments are still met even when you leave Blighty is to rent out your British home in your absence.
Making the decision to let out your property in Britain can make practical sense on many levels – as we’ll discuss in this article. What’s more, we’ll give you all the practical advice you need for letting out your UK property so you can fulfil your dream of moving abroad.
Why it Makes Sense to Think About Renting Property at Home and Abroad
Relocating overseas is a massive undertaking on a practical, emotional and financial level – it is quite possibly one of the most stressful undertakings you will ever engage in – therefore it is of paramount importance that you do it right! In the good old days when the property market in Britain was very buoyant and profitable, there seemed to be less of a risk involved in selling up and shipping out. In many people’s minds, the fact that they could sell their home for more than they bought it for, release the equity and move overseas to a more affordable lifestyle meant that they didn’t really think twice about expatriating.
Many of these individuals are now either stuck overseas in a lifestyle they can no longer afford, are trapped overseas because they cannot afford to return, or admit that they wish they had taken more time, trodden more carefully and researched their new life options more closely before they moved. If you were moving to a new region in the UK for work or even retirement, chances are you’d visit the area, look at the housing market, visit plenty of properties for sale, perhaps even think about renting a house before you bought it, and you wouldn’t rush in to making the decision to relocate.
Researching Your New Life Pays, and it Needn’t Cost the Earth
So why is it that so many of those who want to move abroad seem to do so on a whim? Why do the same criteria and levels of common sense not apply when you move abroad? You do not have to give up one life entirely and swap it for a new one – unseen! Rather you can look into the country you want to move to, spend time there getting to know it, look at how the cost of living will be different to that in the UK, examine currency fluctuations over a period of time and really do all the practical research you need to do to decide if the nation and the move are right for you and your family.
Reasons to Rent Property Abroad
The number one aspect of relocation – after selecting location – is buying a property for most Britons. We prioritise where we will be living and think that it is essential to buy a property before we relocate. But that is not true – in fact, it makes far, far more sense to let your property in the UK out, move abroad, rent overseas and spend time - under no pressure - seeing whether you have chosen the right location for your relocation. Renting a property abroad has many more advantages too. For example it gives you the time to get to know more about the different types of homes people live in. You get to learn which areas are more prosperous than others, where you can afford a decent house for perhaps a little less if you’re prepared to commute a little further. You will learn how to haggle and negotiate a good property deal, perhaps you’ll make friends with a smaller local developer who produces quality homes for living in – rather than the poorly built holiday homes that many Brits end up inadvertently buying.
You can also establish a credit record in a country that can help you get a more favourable mortgage in time. And what’s more, if you suddenly realise that after 6 months or a year that your new nation is not to your liking, you can move on or move back with just 30 days notice to your landlord, (depending on the terms of the rental contract that you signed), and you can relocate again or repatriate.
You see, it really can pay to rent a property abroad.
Affording to Live the Dream Without Breaking the Bank
But to do so, you probably have to rent out your home in the UK. Even if your property in Britain is paid off and you own it outright, therefore there are no major outgoings for it, it can still make sense to rent it out to offset the rent you pay abroad. If you’re renting abroad and paying a mortgage in the UK, it can be essential to earn enough on the rent of the British home to cover the mortgage repayments. So, having covered the fact that it can be very sensible to rent out your British home to enable you to move abroad – how do you go about it?
Well, mistakenly many people think that it is altogether complicated, that they have to change to a buy to let mortgage, pay fees for the change over, alter their insurance and generally face red tape and bureaucracy. But it doesn’t have to be this way as so-called reluctant-landlords are learning. Instead of becoming a landlord with a buy-to-let property, you can become a reluctant-landlord with a consent to let from your lender!
How to Let Out Your UK Home
‘Consent to let’ is pretty much self-explanatory as a concept – it means that you get consent from your mortgage lender to let out your house temporarily. This is a very different process to either getting a buy-to-let mortgage to buy a home, or changing over from your home buying mortgage to buy-to-let debt with your mortgage lender. Many Brits are taking advantage of this consent to let concept whereby those who perhaps want to move now but are waiting for the property market in their area to bounce back can rent out their home for the 2 – 3 years it will hopefully take for a market recovery.
Each lender’s take on whether they will grant a mortgage paying homeowner consent to let out their home is different – so you will have to call your mortgage lender directly. In the vast majority of high street lenders’ cases they consider each request and enquiry on a case by case basis, few will charge you an administration fee and few will look at the equity that you have in the home – that can affect the loan to value ratio for example. So it can be a very straightforward way to let out your British property whilst you move abroad and see whether the move is really right for you. It will also give you the time you need to find the house of your dreams overseas, it will give the British property market time to recover – and/or it will allow you to see whether being a landlord is acceptable for you. If it is, you can always change over to a buy-to-let mortgage on your home in the future if that’s what you want to do.
To Conclude…
So, if you are seemingly stuck in the rut of being unable or unwilling to sell your British home but you want out of Blighty for a new life in the sun, give your mortgage lender a ring, see what their position is on granting you consent to let, speak to estate agents in your area about what a home like yours could rent for per calendar month, and then you will be well armed with the information you need to make a final decision about expatriating. You really have nothing to lose.
