Sell House and Rent?

Lizzy

Yes all good points worth considering.

Funny how I realised straight away that you rented.

We could go on and on with the pros and cons of both. But its not our decision is it.

I know what you would do and I know what I would do and we both speak from experience. My way worked for me and yours for you. Both are a risk and I DO consider my ideas to be more of a risk, and you would expect it to be to keep your home. As a landlady I can't say don't rent :eek:

Where I am from the market is very strong for rental properties at the lower end of the market. They are snapped up as soon as they come up for let. The market is however flooded with luxury rental accomodation especially 1 and 2 bed luxury apartments. Lots of those up for sale because the rent to cover the mortgage can't be found. Sorry I drifted off there, it was just because you said the area where you lived was awash with rental properties.

As I said before it is not my choice, but there is a choice/options. Also peace of mind and being able to sleep is the best motivator in any decision.

Lizzy

PasturesNew

Lizzy wrote: »

The market is however flooded with luxury rental accomodation especially 1 and 2 bed luxury apartments.

The landlords "owning" these flats forgot to research the market.
There aren't enough people earning enough to pay the rents for posh places.

It is VERY difficult for everyday people these days to earn more than £16k in most places. And that is a "good wage". Flick through the papers and you'll see a lot of Office Manager jobs at this rate (and below in many areas).

With a takehome from £16k of £1000/month. And most new development flats on the market at £550-750/month, it's just way too much for a single person to afford. You can add £150-200/month for bills. So they sit empty.

I've just started renting. Signed the papers yesterday, hope to move in next weekend.

I had 2 choices:
[1] almost brand new studio flatlet on a new waterside development
[2] 20ish year old studio flatlet, nicely refurbished in a nice area 2 miles out of town.

[1] £50-100/month more. Only 1 parking spot. Access to a lot of these places is hard for visitors. Visitor parking is sporadic. No sense of community.
[2] Cheaper. 2 dedicated parking spaces. Easy access. Great transport links all round. Small sense of community.

So by choosing to rent older I can afford it. By choosing one of the (hundreds available) new builds I'd be poorer.

With bills, [1] would cost me 60% of my takehome salary [2] would cost me 50%. When you've so little disposable income, it makes a big difference.

Lizzy

Well the luxury apartment thing is so bad the council have put a 4 year hold on anymore being built.

PasturesNew

Lizzy wrote: »

Well the luxury apartment thing is so bad the council have put a 4 year hold on anymore being built.

It'll take more than 4 years to complete/flog the empties they've already got.

alison999

lind1234 wrote: »

Hi
I really need some help, we bought our house 5 years ago, we have a huge mortage and have lots of credit card debt. We are really struggling at the moment to pay the bills especially now that the interest rates have gone up again! We are lucky that we have quite abit of equity, so we are strongly considering selling up, paying off all our debts and renting but I am worried because i have never rented before and have heard alot of bad things about it. I would really appreciate your advice.
Thanks.

Hiya, thats exactly what we did a year ago and I can honestly say its the best thing we did.

gazmona

lind1234 wrote: »

Hi
I really need some help, we bought our house 5 years ago, we have a huge mortage and have lots of credit card debt. We are really struggling at the moment to pay the bills especially now that the interest rates have gone up again! We are lucky that we have quite abit of equity, so we are strongly considering selling up, paying off all our debts and renting but I am worried because i have never rented before and have heard alot of bad things about it. I would really appreciate your advice.
Thanks.

We are in a similar situation and are also seriously thinking of selling to rent.
We have had a IVA in place for a year now giving us just enough money to feed our family of 5 and enable us to survive....week by week....but that is as far as it goes.

Friends are telling us not to sell and that our house is an investment for the future, but where to get the money for it's upkeep if you have nothing.
We are desperate to get the roof fixed and the kitchen is falling apart.........If our cars breaks down we would have no money to buy a new one....I have no idea how to pay for it's repairs next month...to pass the MOT.
If we sold our house we could pay our debts off and still have a good amount of equity to put away....and maybe I could finaly sleep well again .

franklee

poppy10 wrote: »

Great stuff franklee

Thanks, I think people generally underestimate the effect of a credit crunch. Once house prices stop rising (or start falling) lenders will be more cautious as there will no longer be "guaranteed" equity coming along to cover all their costs should they need to repossess.

Another effect of tighter lending criteria is that lenders may no longer allow interest only mortgages without a repayment vehicle running alongside.

When interest only mortgages first became popular lenders insisted on seeing an endowment policy in place or other proof of the method of repayment of the loan. Nowadays interest only mortgages are used to cut monthly costs and do not require a repayment vehicle in place. Once lenders tighten that up again then an interest only mortgage PLUS repayment vehicle will not necessarily be cheaper than a normal repayment mortgage each month. Therefore those buyers relying on interest only to reduce monthly payments will be in trouble.

lind1234

Thanks for all your comments!
Our finance options are limited because we are on low income and my husband is self employed.

I think that we will more than likely sell and rent. It is our only way to pay off everything and start again.

Generali

lind1234 wrote: »

Thanks for all your comments!
Our finance options are limited because we are on low income and my husband is self employed.

I think that we will more than likely sell and rent. It is our only way to pay off everything and start again.

Given your circumstances it sounds like the 'least worst' option at the very least.

If house prices continue to rise then you won't be able to afford to own a house but it sounds like you can't really anyway. If you rent you may also be able to get some housing benefit or something. Benefits aren't really my area though. I pay for them rather than receiving them.