Advice please

Annisele

Your current strategy sounds relatively risk-averse, and it seems a bit odd to me that somebody in your position would want to increase their exposure to risk so much. If you really feel that your money should be "working harder for you", then there are other things you can do that don't involve setting up in business as a landlord.

However, as other posters have said interests rates relative to inflation are poor at the moment; that doesn't mean they'll stay that way.

Worst case: you let your property to a charming young couple, who don't pay the rent, trash the place, and refuse to leave. It costs you several months and thousands in legal costs to evict them, and then thousands more to get your property into a fit state to relet/sell it.

You also say that "reasonably priced properties" in your area are rare. That might just be one of those things, but there might also be a very good reason for it. You might think that the other properties are priced too high because you haven't included all of a landlords' costs into your calculation. Or, it might just be that there isn't much demand for properties like yours. In some areas there are far more couples/sharers renting than there are families, and in those areas three bedroom places aren't as popular as two beds.

I wouldn't rent a three bedroom bungalow unless I had no choice - I'd much prefer a two bedroom flat, as they're usually cheaper (and, like many renters, I'm saving up for a house of my own). In some areas, the rental prices of three bed properties is almost the same as two beds - your area may or may not be like that. Also, I wouldn't rent anything with a garden unless I had no choice - maintaining somebody else's garden is no fun, especially when you know that the LL can throw you out with 2 months notice and so you might not even see the fruits of your hard work. People with children might see both of those issues differently!

You could ask a letting agent to come round and give you an idea of how much they think you could get if you let out your bungalow; that would give you a better idea of figures.