Retire from 8 to 5 

This will be a multiple part series, to be concluded in 2025, once we figure out our physical location. Once the series is done, we will likely update a summary blog with all links.

Some background – we have been considering relocation from Birmingham to Edinburgh to be closer to family. Both of us can work from Edinburgh offices, and has no impact on employment, and our son is in any school system yet. While it sounds fantastic on paper, in reality, there are multiple logistical challenges.

Timing of the move

We need to live in Birmingham, until early- August 2025, for our son to finish nursery in his current location, since nursery spots are rarer than unicorns. More importantly, we don’t want to put our son through an unnecessary brief transition, considering he has already been a trooper with our previous move. So the timing of the relocation is August 2025, so he can start P1 in Edinburgh in mid-August 2025.

Spot in a Edinburgh public school

The next hurdle is a gaining spot in a good public school and finding a house in the school’s catchment area. We can apply directly to the school in our new catchment / residential area, but there is no guarantee a spot will be given. If we get lucky, and get a spot in the preferred school, we need to show proof of address by February 2025. However, if we already rent or own a house by November 1, 2024, when school application window opens, then your school spot is guaranteed. To mitigate this risk, we need to temporarily rent an apartment or purchase a property by October 2024.

Let’s review the rental option first – Apartments for rent in our target neighborhood are £1,200 – £2,000 per month and we will need to sign a 1year lease. Assuming we will move into a rental property in August 2025, we will likely be too tired from the relocation and will probably end up extending the rental for another year. This 2year rental, will likely cost us £28,800 – £40,000 in rent alone, and will likely be a very unsatisfactory transitional stay, which will cast a gloom over stay and make us question our move. How do we know this will happen? Well, most rentals do not allow you to paint the walls, drilling holes to hang shelves or decorations is limited and it continues to feel bare and a stark reminder that it is not yours. And ofcourse, we remember our rush to get out of our tiny rental in August 2022, hardly a few weeks after moving into it? It feels like we will be setting ourselves up for this scenario again. The only alternative is to purchase a property in the catchment area. However, we already have a mortgage on our home in Birmingham, and the bank will not give us a second conventional residential mortgage, since we are not rolling in money. So, this article will be about how we plan to finance a second property, if we find a suitable one. We are hoping others who might’ve tried doing this, will comment on the article and give us suggestions, if we are missing anything. Just to clear it up – we do not have spare cash stash to throw at another property, and do not have any family giving us money either. If you do, then you can stop reading and consider yourself very fortunate!

Option 1: Buy a rental property, in the catchment area. We will still own the property, and can show proof of it for a school catchment spot. The banks will give us a buy-to-let mortgage, as long as proof of tenancy is established as proof of affordability for the mortgage. Then a few months before we move, we will list our B’ham house and ask the Edinburgh tenants to vacate. Assuming it is not fully trashed by the tenants, it might be only some clean-up and paint, which is about a week’s work and we can move-in. Our liability to pay two mortgages is limited to 1-2months only, while the sale of our B’ham house goes through. This is the safest option for school catchment and least financial risk. On the downside, if the tenant refuses to vacate, then we are toast and we need to go through an eviction process. The probability of this risk is low but impact is very high, and almost putting us off against it. We will also need to deal with a property management firm. Given that we already have two full-time jobs and one full-time toddler, dealing with banks, property management firm, tenants, etc. seems a bit much. We need to be realistic with the time and stress-level bandwidth as well.

Option 2: Get an interest-only mortgage on a property, and let it sit empty (or ask friends/family to walk through often) until we move. At first S was not convinced of this approach, but after reviewing the numbers, K has managed to convince S of its viability and low-risk. Firstly, monthly payments will be in the same range as if we rented, £1,500 – £2,000, but with a fixed duration of under a year. Following this, once we sell the B’ham property (assume August 2025), we can pay a lumpsum of the new house, and dramatically reduce the payment and re-mortgage to a conventional mortgage. Secondly, no tenants to consider and their timelines. Thirdly, it provides a guaranteed “landing spot” when we get to Edinburgh. For 6months to 1year, we will have one conventional mortgage and one interest-only mortgage, but we should be able to manage this one financially. There will be some additional mortgage fees to consider, but it will still be cheaper than renting for two years.

So, let the ideal house hunt begin (again). Again, all this is theoretical and let’s see in a year what we do!