Should I sell my house, or rent it out?

squarecat

Morning all,

We own our house (no mortgage), and we would like to move to a bigger house. I know its down to us to make the decision but DH and I have different ideas!

Do we sell our house, and use our savings -ISAs etc to buy the next house without mortgage? Or do we keep our little house and get a mortgage for the bigger house (expecting to rent out the little house, to cover 75% of mortgage payments), using savings to make significant deposit.

Thanks for reading, look forward to your opinions.
Kit

00ec25

have you allowed for Tax?
you say the rent would cover 75% of the new mortgage but as you have no mortgage on the existing property you have lost the largest cost most people have to offset against the tax bill

there are many many posts on here about the downsides of being a LL, are you the one who wants to be or is it the DH, who will have to deal with the issues?

Nosht

Never ever sell property.


Regards,

Nosht.

trumpton

We moved to a bigger house about 4 months ago whilst our old one was still on the market. The reason we did it was because the house we bought was a good deal, we got a very good interest rate from our lender, and we needed to move fairly soon to get near a decent school. Unless you find a house you really, really want, that is good value I would sell yours first so you know how much you have got to spend.

Our house is now SSTC and going through. If we hadn't sold we would have rented it, but being almost mortgage free, the rental income would be heavily taxed.

If you can buy the next house without a mortgage, that would be an option. Interest rates on savings aren't too good at the moment, but you would be taking the risk that if house prices go down, you have two properties decreasing in value.

It hasn't been too much hassle having two houses on the go, but we have only moved about 1 mile away. Good luck, it's tempting to move now when some houses are starting to look better value, but can be risky.