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Sell or rent out?
seven-day-weekend
Posts: 36,755 Forumite
Hi there, just asking for the advice and experience of people on this board.
We bought a bungalow in April, we have an interest-only mortgage on this. We also have a mortgage-free house where we live at the moment.
The idea was to stay in our house while the work on the bungalow was completed, then move into the bungalow, sell the house, pay off the mortgage, job done.
The work is well underway and I find myself in a position where I will not need to to sell the house to pay off the mortgage. (I know I am very lucky ).
So....do we sell it or rent it out? We have rented a property out in the past, so know a little bit about it.
My own thoughts are very mixed, so are my husband's,we just can't make up our minds.
If anyone can help us to clarify our thoughts, then your input is most welcome. Thanks.
We bought a bungalow in April, we have an interest-only mortgage on this. We also have a mortgage-free house where we live at the moment.
The idea was to stay in our house while the work on the bungalow was completed, then move into the bungalow, sell the house, pay off the mortgage, job done.
The work is well underway and I find myself in a position where I will not need to to sell the house to pay off the mortgage. (I know I am very lucky ).
So....do we sell it or rent it out? We have rented a property out in the past, so know a little bit about it.
My own thoughts are very mixed, so are my husband's,we just can't make up our minds.
If anyone can help us to clarify our thoughts, then your input is most welcome. Thanks.
(AKA HRH_MUngo)
Member #10 of £2 savers club
Imagine someone holding forth on biology whose only knowledge of the subject is the Book of British Birds, and you have a rough idea of what it feels like to read Richard Dawkins on theology: Terry Eagleton
Member #10 of £2 savers club
Imagine someone holding forth on biology whose only knowledge of the subject is the Book of British Birds, and you have a rough idea of what it feels like to read Richard Dawkins on theology: Terry Eagleton
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Comments
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In your position, I would keep and rent out the property; the value of the property is likely to exceed the returns from an investments in which you put the released cash.0
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Yes, we thought that too
(AKA HRH_MUngo)
Member #10 of £2 savers club
Imagine someone holding forth on biology whose only knowledge of the subject is the Book of British Birds, and you have a rough idea of what it feels like to read Richard Dawkins on theology: Terry Eagleton0 -
You've been a landlord before so you will know the work involved. If you are prepared to do it then hold on to the house, if not, then sell it and have an easier life.0
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If you've rented property out in the past then you know what it entails and what your responsibilities would be - do you really want to commit to being a landlord?
Another thing you need to consider is that having lived in the house yourself you probably have more of an attachment to it than to other property you've rented out, and might find it hard to step back and see it in the hands of a tenant.0 -
fairy_lights wrote: »If you've rented property out in the past then you know what it entails and what your responsibilities would be - do you really want to commit to being a landlord?
Another thing you need to consider is that having lived in the house yourself you probably have more of an attachment to it than to other property you've rented out, and might find it hard to step back and see it in the hands of a tenant.
Yes, we had thought of that . We have owned the house for forty years and lived in it for most of that time, apart from eight years when we lived in Spain. and even then we visited it. It does make it harder to step back from it, especially the garden and wildlife pond.
On the other hand, once it's gone, it's gone.....don't know what to do!(AKA HRH_MUngo)
Member #10 of £2 savers club
Imagine someone holding forth on biology whose only knowledge of the subject is the Book of British Birds, and you have a rough idea of what it feels like to read Richard Dawkins on theology: Terry Eagleton0 -
Keeping it and renting it out sounds like a great plan. Go for it!0
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seven-day-weekend wrote: »Yes, we had thought of that . We have owned the house for forty years and lived in it for most of that time, apart from eight years when we lived in Spain. and even then we visited it. It does make it harder to step back from it, especially the garden and wildlife pond.
On the other hand, once it's gone, it's gone.....don't know what to do!
We moved to another part of the country but kept our old house as we weren't sure about where we wanted to be. Our first tenants were a nightmare, they paid the rent but did so much minor damage to the house and it was filthy. Really did get us down. We then let it to a nice family who eventually bought it off us.
We are "accidental" landlords. We inherited my MIL house and a family member needed somewhere to live so they moved in. We bought another house when some relatives were in a difficult position and let it to them. So we have been landlords for the last 8 years. It makes such a difference when you know the people and don't have to worry about them damaging the place or not paying the rent.
Personally I look forward to be able to sell both houses but some people seem to love being landlords so I guess it is down to personality.Sell £1500
2831.00/£15000 -
What would the yield be on the rental?
Bit of a grey area as to whether the interest on the bungalow would be an allowable expense against the rental income. "yes" in that there is no obligation for the loan to be secured on the actual rental property and if you did sell the house you would clear the mortgage, so keeping the mortgage going would become an expense precisely because you are renting out the house. "no" because that wasn't the purpose of the loan. So a bit of a grey area; possibly need professional advice rather than keyboard warriors.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
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