Not sure what do

Pobby

We are moving in with my sister in law . Decent sized house and it will be just the 3 of us. We bought out her ex. Right now I have a terraced house worth approx. £130 thousand. Both of us are middle late 60`s with a joint income approx. £24000 per annum which is quite enough for us. The choice is to sell or lease the house to the council. The joint house needs up dating and the rent from the council would be used, in part, for this.

I like the idea of renting, my wife doesn`t. So if we sell I would like as close to 4% of the capital as an income . Not sure if I have the temperament for a risky investment. Done that and I am blessed to have hung on long enough to see it come around. I have a bit over %0 thousand pound "liquid" and easy to get to to. Would really like to hear some ideas. Thanks all.

xylophone

Do you want to be a landlord? You might read through some posts on the board concerning responsibilities/ deposits/tenants/ bad tenants/S21 etc.

Otherwise, as you have £50,000 (?) in liquid savings and ( presumably) regular income from salary/pension/ deposits, you might consider the stock market - an ISA for you and your partner would be a start.

A 4% yield using equity income/ distribution funds/perhaps a REIT or two should be possible.

If you are unsure about how to approach this, you could consult an IFA.

bigadaj

Probably depends on the terms of your lease agreement with the council.

If they guarantee rents, underwrite to repair all damages and pay for voids then it sounds like a good option. That would remove most if not all of the risk normally associated with renting , ,isn't also depend on the length of the lease

The rent would be taxable and you would start to build up capital gains tax liability.

Investments could probably provide a similar return, but with your capital at risk and variation in value. For investments you could get that amount into isas for a couple in less than three years which means any income would be tax free.

xylophone

http://www.independent.co.uk/arts-entertainment/let-your-home-to-the-council-paul-gosling-reports-on-a-tenant-who-could-prove-id

Old but may be of interest if the OP chose the letting to council rather than to private tenant.

bigadaj

xylophone wrote: »

http://www.independent.co.uk/arts-entertainment/let-your-home-to-the-council-paul-gosling-reports-on-a-tenant-who-could-prove-id

Old but may be of interest if the OP chose the letting to council rather than to private tenant.

Link doesn't seem to work but the OP does state a council lease rather than a private letting arrangement.

Councils are desperate for accommodation given how much they are spending on b & b and if the contract is right then it can be lucrative depending on provision for payment, repair and commitment.

AnotherJoe

Pobby wrote: »

We are moving in with my sister in law . Decent sized house and it will be just the 3 of us. We bought out her ex. Right now I have a terraced house worth approx. £130 thousand. Both of us are middle late 60`s with a joint income approx. £24000 per annum which is quite enough for us. The choice is to sell or lease the house to the council. The joint house needs up dating and the rent from the council would be used, in part, for this.

I like the idea of renting, my wife doesn`t. So if we sell I would like as close to 4% of the capital as an income . Not sure if I have the temperament for a risky investment. Done that and I am blessed to have hung on long enough to see it come around. I have a bit over %0 thousand pound "liquid" and easy to get to to. Would really like to hear some ideas. Thanks all.

Do you mean a house by that comment? Or stock market investments?

Pobby

AnotherJoe wrote: »

Do you mean a house by that comment? Or stock market investments?

I was thinking about the stock market but i am very aware that renting can have draw backs. The council lease for a minimum of a year. Buildings insurance is down to me. Fair wear and tear is also down to me. The rents is paid whether let or not at about 10 to 15 per cent less than the private sector. No furnishings are supplied by me except floor coverings and curtains so no problems with white goods. the property is returned in the same state as first let and if any major work, no fault of the tenants, £250 a year is granted to me. So quite a deal.

Any way taking thank you for the comments so far.

AnotherJoe

Pobby wrote: »

I was thinking about the stock market but i am very aware that renting can have draw backs. The council lease for a minimum of a year. Buildings insurance is down to me. Fair wear and tear is also down to me. The rents is paid whether let or not at about 10 to 15 per cent less than the private sector. No furnishings are supplied by me except floor coverings and curtains so no problems with white goods. the property is returned in the same state as first let and if any major work, no fault of the tenants, £250 a year is granted to me. So quite a deal.

Any way taking thank you for the comments so far.

You're right that is quite a deal compared to private rental and if I was still a landlord that would definitely interest me since as someone else said it removes many of the risks of being a landlord.
Do you know what the rate you would get works out as?

xylophone

Link doesn't seem to work

Tried again.
http://www.independent.co.uk/arts-entertainment/let-your-home-to-the-council-paul-gosling-reports-on-a-tenant-who-could-prove-ideal-1535702.html

bigadaj

xylophone wrote: »

Tried again.
http://www.independent.co.uk/arts-entertainment/let-your-home-to-the-council-paul-gosling-reports-on-a-tenant-who-could-prove-ideal-1535702.html

Thanks, that appears to be an article from 1992 though?

xylophone

Thanks, that appears to be an article from 1992 though?

As I said in my post 4 above....


Old but may be of interest if the OP chose the letting to council rather than to private tenant.