why do some people own more than one property?

JimmyTheWig

want2bmortgage3 wrote: »

The only reason I can think of is people don't trust pensions and want an alternative investment

A property seems very real. The bricks and mortar will always be there, where as stocks and shares can appear to be theoretical.

Madmel

Werdnal wrote: »

I can only comment on my own situation.

I resent the suggesting that is it greed or status. I worked hard for my redundancy money and savings, and want it to work for me, rather than sit in the bank earning very little interest! If there was greed or status involved, I would be shouting about my property ownership, but in fact very few people (family and close friends) actually know I have a 2nd property - perhaps I am afraid they will jump to conclusions and judge me like you seem to have!

Me too. DH and I each owned a mortgaged property when we first met. Sold both to buy a family house (mortgaged). My mum dropped dead leaving me a significant sum of money [insurance policy and good inheritance planning]. DH had bought his mother's place, so we sold that and bought her a retirement flat close to us. We moved to a bigger place where my dad could stay with us, paying off our mortgage and buying this outright. We went without holidays and luxuries for several years to be in this position, owning two properties outright, although both are lived in by us/family. Nobody apart from my dad knows we are mortgage-free - we are not remotely interested in status symbols and hopefully aren't particularly greedy. If I could have my mum back instead of the money, I would.

Rosemary7391

There are people who make a genuine business out of renting property - I know all of it is supposedly business but sadly not all LLs treat it like that! Those of us who have to rent or would prefer to rent do need people to be renting places out, so it all works out somewhere.

seven-day-weekend

want2bmortgage3 wrote: »

Just something I've been thinking about, everyone needs a roof over their head and I would have thought most people would prefer to own than rent.

So, for someone that owns a property with a lot of equity or savings, why do they decide to buy another one, instead of just paying off their existing mortgage then putting any excess in savings?

The only reason I can think of is people don't trust pensions and want an alternative investment, to one day live off the rent of the 2nd property? Is there any other reason apart from greed/status?

We are thinking of buying a house to rent out with the proceeds of the sale of our Spanish house and a small BTL mortgage. We thought we would do this, rather than invest the money, as house prices are cheap at the moment and hopefully in the long term will begin to rise again. Doing this will give us some income now, but more importantly, will give us something to sell as well as our own house if we want a ground floor flat or bungalow in he future. We'll be able to get one in a nice area. We are in our early 60s now and are mortgage-free on the house we live in.

That's our reasons for having more than one house.

jimjames

Someone else paying off the mortgage on a property for you is pretty high on the list. With the current climate there aren't many investments you can get where someone else is contributing to it for you.

I think it is also a useful service for people who can't/won't buy to have a decent stock of houses available to rent.

mqandy

I'd love a bolt hole in the Welsh mountains as a second home, but that's not going to happen any time soon!

That said, I serriously can't understand why the tax system almost encourages second home owners (council tax DISCOUNT on holiday homes, etc), rather than charging a premium (as the super-socialist french are considering, hmm)...

BobQ

want2bmortgage3 wrote: »

The only reason I can think of is people don't trust pensions and want an alternative investment, to one day live off the rent of the 2nd property? Is there any other reason apart from greed/status?

Most of the replies assume that its for BTL. There are lots of other reasons.

For example your employer might ask you to relocate 50 miles away. Maybe you do not want to live near that place but do not fancy driving 100+ miles a day. So you buy a cheap house and live in it four nights a week. You buy because its cheaper than renting, maybe you hope that you will make a bit on the investment but the main reason is not wanting to spend 4 hours a day on the road or the train.

You might buy a house for your student children on the basis is cheaper than renting, but investment is secondary to ensuring they have a good place to live in.

You might like to take holidays in a favourite place

Or you might do it because you can afford it

mikey72

We have the one we live in, the second properrty is a btl that was bought with a 1% above base rate on the first property, and more than pays the mortgage on them both.
I'm looking for a retirement property to renovate in readiness, and maybe a renovation somewhere in central france.
Then maybe sell the first one.

So different reasons for each.

somethingcorporate

So a whole bunch of reasons from vanity, to falling in to it (like us as accidental landlords), to supplementing income to capital generation, to just doing something a bit more interesting with spare cash!

One thing that is worrying is the fact it has become more mainstream to own second properties for B2L but some of the LLs are very amateur and do not treat it as a business, which gives the professional and more serious LLs a bad name. Saying that, it could be said about anything (especially estate agents, but I am yet to find a good one!).

betsie

No it isn't just greed and status.
We sold our large house and bought a smaller one for ourselves. We then had enough to buy my elderly mum & dad a bungalow 5 mins up the road from us. They lived in a very rough area of London and had very steep stairs which they couldn't manage.