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Sell flat for low mortgage or rent out
adonis10
Posts: 1,810 Forumite
Having lived in my mortgage free flat for 2.5 years I'm now looking to get a place with my partner and have a dilemma.
Option 1:
Sell flat and put down a massive deposit and have a very low mortgage and plenty of disposable income.
Pros:
- low commitment each month
- plenty of disposable income to accommodate inevitable interest rate rises
Cons:
- no fallback plan (fully owned property to live in) if interest rates reach silly heights in the future
- not really making extra disposable income work well and increase in value
Option 2:
Rent out flat for around £800/month, put down about 20k each on a new place (ideally a house) with a 200-230k mortgage.
Pros:
- one fully owned flat and working towards owning another
- rental income basically covers my part of the mortgage
- plan b if anything goes wrong with a) economy and/or b)relationship
Cons:
- high monthly mortgage which could get out of control when rates go up (although renting out spare room could help mitigate this)
- not much disposable income to save and/or put in pension.
Just looking for some advice, really. I'm sure there are people here who have been/are in a similar situation.
Option 1:
Sell flat and put down a massive deposit and have a very low mortgage and plenty of disposable income.
Pros:
- low commitment each month
- plenty of disposable income to accommodate inevitable interest rate rises
Cons:
- no fallback plan (fully owned property to live in) if interest rates reach silly heights in the future
- not really making extra disposable income work well and increase in value
Option 2:
Rent out flat for around £800/month, put down about 20k each on a new place (ideally a house) with a 200-230k mortgage.
Pros:
- one fully owned flat and working towards owning another
- rental income basically covers my part of the mortgage
- plan b if anything goes wrong with a) economy and/or b)relationship
Cons:
- high monthly mortgage which could get out of control when rates go up (although renting out spare room could help mitigate this)
- not much disposable income to save and/or put in pension.
Just looking for some advice, really. I'm sure there are people here who have been/are in a similar situation.
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