Sell London flat, or no?

[CuteKinn]

Hi,

We moved out of London last year to Wales, and we have permenately decided to live here. We have a 2 bed flat in London (zone 3 - no mortgage) that we were planning to sell once we had settled down in Wales, and buy a much larger permanent property here. We are therefore currently renting.

DH is having second thoughts about selling the London flat, saying it will increase much more in value in the next few years, especially after brexit. I'm not on keen on taking a mortgage out for a new property here (we have been there, done that, and we are also on flexible contract work so it's easier not having a huge mortgage) but at the same time would also prefer to buy our own place here now that we have settled down. What would you advise us to do?

Bubbles -- they are only 2 miles apart.

I would be very concerned if there was a 23% gap in price after only 12 months - even more so because this 23% differential will be hundreds of thousands.

It seems like a game of roulette - when everyone assumes London is a safe bet.

I think that the trick with buying new builds - is to buy a second hand one - couple of years old - bit like buying a car - dont be the purchaser who looses ££££ just driving it off the forecourt - or putting the key in the door.

Whether a newbuild is maintenance free will depend on the builder. I've known of some that have been very shoddily built. A dd once had a temp job with a very upmarket EA in London - the EA was managing a lot of expensive rental flats in a newbuild block in Wandsworth. Dd regularly had tenants screaming down the phone about shoddy-build issues such as sh*t coming out of the shower - I am not making this up.

The builder concerned is still whacking up flats by the hundred - I would not touch one of theirs with a fifty foot bargepole.

Sell now! Increase in value post Brexit? I really don't think so.

so you can buy a property outright in Wales if you sell the London property now?

I'd say sell it now. Partly because of a bird in the hand etc.

tbh so much of London investment is driven by investors from non-EU countries, I think there's a possiblity of a small flattening out and then they might go up again, but really, if it means an outright buy or a very small mortgage in Wales, I'd just sell now instead of assuming prices will rise.

Kensington & Chelsea is West London, the City is basically East. You really can’t compare them. And surely further apart than 2 miles?

ancient I would advise your daughter to try and jump the 2 bed flat and get something that would be a first family home. My dh and I bought a just about 2 bed flat just before the last property crash when prices were ridiculous and the banks were handing out 100% plus mortgages. We could have bought something bigger but were worried about overextending, interest rates rising, etc. We were also on rising salaries, my dh on a really good one. In theory we were being sensible, but what happened was we outgrew the property when prices had not recovered and ended up with little equity to trade up but high salaries that meant affordability was fine to do so.

Had we stretched ourselves we would have ridden out the banking crisis fine and probably be in a nicer house now. You can’t absolutely guarantee that someone isn’t going to lose a job or similar. But if you work out the worst possible scenario and the mortgage is still payable I would go for it. 2 bed flats are always hit badly in the capital when prices fall. Especially anything on the small side of a 2 bed.

Thanks everyone for your advice. Tbh I am still as confused and haven't made a decision. It would make sense to leave that property as an investment, but I think getting another mortgage here is not really an option, as we are freelancers, and DH is almost semi-retired (early retirement).

Have a look at how much equity you could draw if you converted it to BTL - if you're keen to retain a foothold in London.

If you'd prefer a simpler life (no hassle on letting etc) then sell it.

The east of K&C borough is 2 miles from the west of City of London.

OP you can get a Let to Buy mortgage - which means you release equity from your London flat (mortgage sits on that property) and buy outright in Wales. Rent from London flat pays the mortgage

That sounds like a good option, thanks. Will look into it.

Could you sell your London place but keep a foothold in a smaller house that you can rent further out? Somewhere like Bromley? You could then have enough to buy outright in Wales?

Can any property people on here make suggestions as to how to calculate a tipping point for the sell-in-London/buy-somewhere-else dilemma or how to calculate them? Spring 2019 being the best time to try selling etc?

We live in NL, rent out our old house in Stoke Newington but because of Brexit, are thinking of cutting our losses and buying an investment property here (i.e. not to live in but rent out). The Amsterdam market is incredibly hot at the moment but are we losing money by staying in the UK?