Would it be reckless to sell my house in Leeds and return to renting?

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Q After many years of working at the same job in Leeds, I am considering going freelance and moving to a new city. I’ve been craving change for a long time and this feels like a challenge I need. It seems, however, in doing so I will have to say goodbye to being a homeowner and return once more to renting. My current fixed-term mortgage ends in November this year. As I understand it, a freelancer needs two to three years of income history before they can apply for a mortgage. Is this the case and am I being reckless selling a house that I worked so hard to buy and going back to renting during a cost of living crisis when rent is so high? Any thoughts or advice would be extremely appreciated.
RW

A Yes, you are right in thinking that any self-employed person – which includes freelancers, contractors, sole traders and small-business owners – applying for a mortgage will need to provide at least two years’ evidence of a regular income with account statements as well as self-assessment tax forms for two complete tax years, if not three. So that would rule out getting a mortgage if you decided to sell up in Leeds and move to a new city, and it would also mean that you would have to go back to renting.

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Making so many big life changes all at once can be challenging. I wonder whether it wouldn’t be better to make them incrementally? You could, for example, give up your current job and go freelance but stay in Leeds for the amount of time it takes to build up the evidence of income you will need to get a mortgage in a different city. This way you would also find out whether freelancing is going to work out for you. If it doesn’t, you could go back to being an employee but make a move to a new city by applying for a job there.

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An alternative – if you are keen to leave Leeds – would be to hang on to your house but to rent it out. This would involve either getting permission from your current lender or switching to a buy-to-let mortgage. But I’m not convinced that this is a sensible option if your new city is going to be miles away.

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