Should I sell my property?

boxrick

Im looking on advice on either to sell my house or continue renting but at increased rental prices and perhaps a remortgage.

I purchased a house in 2010 with my girlfriend, we lived there for around 4 years and paid £95000, I remortgaged around 2012 and it was valued at £87500 as such had to put in a further hefty amount to get the mortgage deal we wanted. ( 10 yr fix @ 4.49 and increased to 5.49% as CTL )

We ultimately moved out of the area and rented out the house to our 'rent a room' tenant, this was in 2014 due to the fallen value of the house. Since then we have rented out a further additional room at this property.

Rent gives total comes to £750 per month. I pay all the bills which come to around £275 and the mortgage is a further £750 due to being only a short mortgage.

So upkeep on this house is £275 per month with a mortgage which is rather steep in current % terms. Also to add to this the property is 150 miles away and we manage it ourselves. Then extra costs such as insurance, gas safety and general upkeep.

The tenant always pays and given the situation would likely rent from us more or less indefinitely. He and his housemate however are slobs which causes ongoing damage to the property and garden.

Finally if we were to sell up and achieve what we paid in 2010 we'd have around 55k equity and then minus the costs of selling and ERC for the mortgage of around £2500.

So Simply:

1) Do I clean up the property and give the tenants notice to move out? We can use this money plus my savings to make buying our next home easier. This is what I feel I wish to do, but it feels wrong and horrible throwing out my tenants when they don't expect it and im really scared about the current value of my house.

2) Do I continue to rent to them but at a sensible charge and pay no bills. This would be around £325 per person based on the area and going prices. And of course sort out the mortgage.

Any suggestions or advice of any kind is greatly appreciated!

AnotherJoe

Sell. Removes the hassle and the extra deposit will lower your LTV and thus mortgage payments so you can use the money to better effect.

beanandbean

Your concerns about throwing your tenants out- we were in the same situation as your tenants 2 years ago.
Landlord had to sell house after my husband (then partner) being a good tenant for almost 4 years, I had recently moved into the house.
Landlord gave us two options - Go onto a monthly rolling contract and be aware we could be given a months notice at any time (he was perfectly transparent with us why this was), or he'd give us a set period say 3 month contract and expect us out dead on the end of it.

If your tenants are good tenants and reasonable human beings maybe sit down with them over a cup of tea and explain your options.
It's never nice turfing someone out of their home but there are definitely ways to do it!