Brit couple move to SPAIN for a year to save up for one-bed flat deposit in London because it’s cheaper than renting
BRIT couple Ryan and Kiera Crabbe have moved 800 miles from London to Spain to help save up for a deposit on a one-bed flat because it is cheaper than renting in the capital.
Ryan, 33, and his wife Kiera, 36, moved out of their rented property in Kensington in May this year and are now leasing a two-bed flat in Mallorca while they save for a deposit.
Both of them work as freelance consultants - Ryan in marketing and Kiera in events - which gave them the freedom to move abroad while still earning their London wages.
They'd already managed to put aside £48,000 but decided to take another year to top up their funds to make their mortgage as small as possible.
The consultants - who didn’t want to disclose their income but say they are both high-rate taxpayers meaning they earn over £46,351 a year - reckon that moving abroad means they pay £1,200 a month less on rent and bills compared to London.
In total, they are saving £2,000 a month thanks to their new lower living costs.
“We’re lucky that both of our jobs mean that we can live abroad and continue to earn what we did at home,” Ryan told The Sun.
“We knew we wanted to buy a place of our own but it was going to take us around six years to save for somewhere while we rented.
“It’s a temporary arrangement as we’d love to go back, but we can see what it's going to lead too - and the lifestyle is great here.”
The couple who are self-employed say they faced putting down a bigger deposit to increase their chances of passing the affordability checks.
This is because they are considered riskier borrowers as their income isn’t regular, so they face higher rates and less choice with lenders.
How to save for a house deposit
RYAN shares his tips on how to save money for a deposit:
- Split your money across different savings pots - We set up regular payments that would go into each of our pots so that it was easier to budget for different things. We had ones for tax, deposit, holidays and spending. This way we can see where it all goes.
- Swap to a weekly shop - We were shocked when we realise how much we were spending by just nipping to the shops to buy food for meals every day. We cut our food bill down by £400 a month when we planned ahead.
- Move abroad - Of course, this isn’t an option for everyone but if you are able to then I would recommend at least looking at it as an option. Kiera’s parents already live in Mallorca so we knew that we’d like it. But it was affordable to us and it’s letting us continue to save.
Commuting costs are cheaper too as they both travel to the UK around once a month to meet with clients.
While in London, Ryan spent up to £240 a month traveling to meet with clients in Bournemouth and Bristol but now he only spends around £50 for a return flight to the UK once a month for meetings.
In January 2017, the pair - who’ve been together for nine years - decided that they would save to buy somewhere in the capital but realised that it would take them almost six years to get the funds together.
They’d budgeted to put aside £600 a month which was all they could afford while they rented a one-bed flat in Earl’s Court for £1,400 a month.
They hope by moving to Mallorca, near to where Kiera’s parents live, they would have saved enough to put down a £75,000 deposit for a one- or two-bed flat in the capital, meaning that they would have cut the time needed to save down to two years.
This was because they already had a head start, and had managed to put aside £48,000 before they moved abroad.
Months after they’d decided to start saving, Ryan entered a gruelling competition to live rent-free for a year in Kensington.
Run by , the competition was designed to help first time buyers get on the property ladder, and promised to match whatever Ryan and Kiera could save in the year.
Even though they did still have to pay for bills, they’d managed to put aside £2,000 a month which they would have otherwise spent on rent.
At the end of the year, they’d tucked away £24,000 - which was matched by the competition organisers to make £48,000.
But while it was enough to buy a small one-bed flat in London - which cost £384,000 on average according to Rightmove - they decided to take their chances and move abroad to continue saving for another year.
What help is out there for first-time buyers?
GETTING on the property ladder can feel like a daunting task but there are schemes out there to help first-time buyers own their own home.
Help to Buy Isa - It's a tax-free savings account where for every £200 you save, the government will add an extra £50. But there's a maximum limit of £3,000 which is paid to your solicitor when you move.
Help to Buy equity loan - The government will lend you up to 20 per cent of the home's value - or 40 per cent in London - after you've put down a five per cent deposit. The loan is on top of a normal mortgage but it can only be used to buy a new build property.
Lifetime Isa - This is another government scheme that gives anyone aged 18 to 39 the chance to save tax-free and get a bonus of up to £32,000 towards their first home. You can save up to £4,000 a year and the government will add 25 per cent on top.
Shared ownership - Co-owning with a housing association means you can buy a part of the property and pay rent on the remaining amount. You can buy anything from 25 to 75 per cent of the property but you're restricted to specific ones.
"First dibs" in London - London Mayor Sadiq Khan is working on a scheme that will restrict sales of all new-build homes in the capital up to £350,000 to UK buyers for three months before any overseas marketing can take place.
Starter Home Initiative - A government scheme that will see 200,000 new-build homes in England sold to first-time buyers with a 20 per cent discount by 2020. To receive updates on the progress of these homes you can register your interest on the website.
They’re now looking at flats around the £400,000 mark in Battersea or Putney and hope that they can put down a 15 to 20 per cent down payment.
Ryan added: “When our rent-free year was up, we were looking at places to buy or rent in London but we weren’t sure where we wanted to live and we didn’t want to go back to paying that much rent again while we decided.
“We considered moving out of London but we then had to think about the commuting costs and it wasn’t very appealing.
“A 5 per cent deposit was never really an option for us either because we’re self-employed so we were looking at having to save more anyway.
“We don’t want to be paying off the mortgage for years to come so it made sense for us to move abroad for a year to save a bit more while we could.
“Owning our own home is important to us, especially as we’d rented in London for about six years so we really can’t wait to put our own stamp on our home.”
MORE FOR FIRST-TIME BUYERS
First time buyers have it tough. In June, an estate agent estimated that single first-time buyers need over a decade to save up for a deposit - and it could take Londoners up to 17 years.
Once you've saved up the cash, we reveal how to find the best mortgage if you're a first-time buyer.
Are you a first-time buyer who's made it on to the property ladder? Why not take part in our My First Home series.
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