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Let to buy or sell?
busylizzy99
Posts: 4 Newbie
Hi - We are looking to move to a three bed house. We currently own our terraced house worth about 110k and have saved about 80k to put towards the new one.We have lived here for 10 years.
However my sister rents a tiny house and would be interested in renting ours for £520 a month. Obviously we would have good tenants and would be able to let directly and not through an agent. We could borrow about 125k from the bank. I was thinking of having a repayment mortgage on our current house for 100k over 25 years and then 25k repayment over 25 years on the new property.We could then look for a property for about 200k(taking into account our savings).
I would be doing my sister a favour and would hope it makes financial sense for us to.
However I worry about CGT if we sell later as when we bought our house it was 52k, now its worth 110k. Will we just be paying loads of interest to the banks with no benefit for us? Does it make more sense to sell? If we sold we would have 110k+80k savings so 190k and then take out a small mortgage to look for a property upto 250k rather than being limited to the 200k we if let to buy.
Am trying to look into it all but am not sure what do and would really appreciate some advice as I know there are some very knowledgeable people on here!Thank you!
However my sister rents a tiny house and would be interested in renting ours for £520 a month. Obviously we would have good tenants and would be able to let directly and not through an agent. We could borrow about 125k from the bank. I was thinking of having a repayment mortgage on our current house for 100k over 25 years and then 25k repayment over 25 years on the new property.We could then look for a property for about 200k(taking into account our savings).
I would be doing my sister a favour and would hope it makes financial sense for us to.
However I worry about CGT if we sell later as when we bought our house it was 52k, now its worth 110k. Will we just be paying loads of interest to the banks with no benefit for us? Does it make more sense to sell? If we sold we would have 110k+80k savings so 190k and then take out a small mortgage to look for a property upto 250k rather than being limited to the 200k we if let to buy.
Am trying to look into it all but am not sure what do and would really appreciate some advice as I know there are some very knowledgeable people on here!Thank you!
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