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Comment by davidhyde | Hacker News Reader

Get on the property ladder before you take your sabbatical.

I recently took an 18 month sabbatical from my banking software development job and it was well worth the risk. I had been working for 11 years. I ended up getting my old job back when I returned because I did not leave on bad terms. I probably would not have if I had stayed there any longer as work and London life was turning me into an angry selfish person in general.

My only regret is that I didn't buy a flat or house just before I took the break. Whilst employers are more than open to the idea of a long sabbatical in my industry, lenders are not. Right now I am earning just as much as I used to but I am struggling to get a home loan despite having an excellent credit rating. They see that hole in your work history and it gives them the jitters. I should have bought a place and rented it out before I went traveling.

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That is all fine and well during a property bull cycle (which admittedly we've had for the last decade plus in the UK).

But equally property really ties you down if you are dependent on paying a mortgage. If you live somewhere with not huge demand for rental, then you cannot leave your job.

Mortgages and property prevent many people from taking time off, I could tell you of loads of people I know who cannot take time off because they need their monthly wage for mortgage.

In the US I often see well paid friends struggle financially after buying a house (I do live in a high cost area in the US). And most landlords (again, US) will accept a bank statement with 12-14 months rent in lieu of a salary check. You can prepay 12 months to avoid any questions whatsoever.

I would personally avoid buying a house before jumping off as that would occupy my mind instead of freeing it. My 2c.

"..And most landlords (again, US) will accept a bank statement with 12-14 months rent.."

When I was starting a company and without a salary it was really hard to find a landlord who was OK with this. Some seemed to be thinking "eh, this is different from the norm and I have plenty of applicants so it's not worth the mental trouble", and others "irregular income situation probably means they sell drugs".

Right now, in London and if you have a 15% deposit, its cheaper to buy a place than to rent from month to month so I guess it depends where you live. I always thought it was better to keep my savings liquid for startup capital but I found myself going back to work because I did not like spending it on rent. I figured that I would continue my project at a slower pace in the evenings and weekends and cover my expenses in the meantime. This is not a good recipe for swiftly setting up a startup.

Good to know. One difference may be buying a flat in a multi-family building, so the costs of major repairs (roofs and such) is shared and can be handled by a management company for a fixed monthly cost / subcontracted / insured against. That (I think) makes total cost easily predictable.

My observations are from US where more than one family I know bought a house (old house, expensive because of the good school district, which is why they bought it), assumed low maintenance costs, then got hit with some sizeable repairs (as the house is old). Not trying to generalize, that's just what I saw.

Strange, this is one of my regrets as well -- not investing in real estate!

I also think you better adjust your view instead of that suggestion. If that kind of factor influences your options for loans then don't loan that much money. Wait for a better time to buy a house, find a better house, save more, or simply never buy. Financially it's not smart to buy a house in the current market in most places I've heard about.

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