Keep, sell, or ???

WHAT_DO_YOU_THINK?

Hi there,

I'm new to this so apologies if in the wrong thread, or indeed forum but thought I'd give it a try...

A bit of background:
I'm an accidental landlord due to meeting my husband. Between the two of us we now own and live in a 3 bed property which has a market value of £250k. Price hasn't been rising as much as expected as it's ex LA but in time think it will be well worth holding on to and rental income is attractive. We also rent out a 1 bedroom flat currently valued at £150k. As it's been rented for 5+ yrs we are worried that if we sell it we will be subject to CGT so the rise in value will be heavily hit by CGT of (I think) 18% of your profit.

Coupled with the above, we want to move and are saving a deposit but it's taking some time. We have an ISA with the savings in as well as a normal savings account.

My question is other than be patient (!), could we be savvier with our money reaching a cash deposit of £50k quicker whilst keeping the properties above (as we don't have pensions) / should we sell one of the properties / option c that we haven't thought of?

Any advice would be appreciated.

Thank you

TheSenSibleOne

I think you are right to stick with your properties.

You would more than likely be charged CGT around 18% ish.

The easiest option open to you is an increase in the rent you are charging. Anymore money you can charge your tenents is more money to put into your savings. Its cruel but true. Double check what similar local properties are being rented for.

Make sure the savings you have currently are achieving the most you can, e.g. move to higher interest account

Good luck

xylophone

http://www.hmrc.gov.uk/helpsheets/hs283.pdf might be worth a read.
Are you sure you want to rely only on property as your pensions?

WHAT_DO_YOU_THINK?

Thanks both.

Xylophone - The reason I choose property is due to circumstances and TBH not really sure to start with everything else! I'm mid thirties so thought I'd missed the boat on a pension and everyone you speak to tells me their pension won't be worth anything when they are ready to draw it down. Happy to be told otherwise though...hence the cry for help

Thanks again for your help!

srcandas

WHAT_DO_YOU_THINK? wrote: »

............ everyone you speak to tells me their pension won't be worth anything when they are ready to draw it down.

I started in my thirties and I feel that the value of the pot could have been more quite easily and that the annuities offered are really bad value. A year ago looking back I felt ripped off.

However investigating all options (with lots of help from here) I have discovered you can improve things (e.g. drawdown, max lump sum, covering the gap between state pension and personal allowance, .... and as the government moves towards more pension flexibility who knows what options will be available when you retire??).

Not saying it is great but I know had I not locked that money away I would have been tempted (no I would have) to play with it and I wouldn't have the reserves I have today.

On the whole I'm glad I did it especially as I didn't really notice a couple of small monthly DDs. You just get used to it HTH