Keep or sell?

bluedrop

We refurbished our current home with a lot of love and attention to detail. However, its now too small for our family. We've been thinking of moving for a long time, but the idea of selling this house is breaking our heart. Moreover, this house has a lot of potential - loft conversion and conversion into two flats (a couple of properties in the neighbourhood have done it). Its a lovely area with good schools and great links to London (its in zone 4).

If we rent it out as it is, it can get us a rent of £1800 pcm. This is more than enough to pay the outstanding mortgage (very little left as we've overpaid). If we pool all our savings together, we can afford a bigger home without having to sell. DH and I have reasonably well paid jobs, we can comfortably afford mortgages on both houses (during voids etc)

Does it make sense to keep this house? I am asking for opinions here because by nature DH and I are very risk averse people. I feel we are losing out due to this attitude. We have money sitting in bank accounts (savings) and its doing nothing.

hazyjo

Never ever rent out a house you're emotionally attached to/you love! Number 1 rule lol!


We love our house and are gutted to be leaving it (moving at the mo). But all your furniture and stuff will be going with you, and decor only really stays nice for a handful of years. Just move and look forward to decorating/refurbing the next one.


Put the money into a big enough 'forever house'.


Good luck.


Jx

LEJC

Do you want to be a LL with all it entails?

If the house has potential for extention why dont you do it...I have a feeling I shared your initial refurb through this site a few years back...youre clearly capable of doing work.

Would you be splitting the property into 2 flats?

If so...the emotional goes at that point because its the home that you are breaking up.

I think I was able to give you advice last time with your refubishment on the back of us doing a similar project ....we went on to indeed rent out the family home and yes it brings in a good income but its not always easy to seperate the emotion of first home/rental unless you then go more down the rental market as we did....although the extra properties meant we wiil probably go no further up the property ladder going forward.

If you desire the bigger family property,now is the time to do it when you and your children can enjoy it......
In your shoes I would move.

your additional stamp duty on the new home without selling the existing one should be enough to deter you from making any profit on a rental property for a good few years!....something that wasnt around when we did all but the last 2 of our rentals.

saajan_12

If the property is too small for you, you'll likely never be able to move in again and enjoy the decor etc.. by the time kids move out and you want to downsize or kids are ready for your own home, it'll probably need to be redecorated anyway and it's very unlikely that particular house will be the exact size / location you need at the time. Letting the property still means other people are living there, causing wear & tear, accidental damage etc.. so your decor won't be preserved for long.

So, the only benefit is knowing you still own that house on paper which once felt perfect. In practice you'll have to watch it deteriorate as tenants come and go, with the added LL responsibilities, repair costs, strain on mortgage affordability etc.


Instead, take some pictures, hold a house leaving party or something and then sell and put everything into perfecting your new home which you'll see everyday rather than the knowledge that you own something.

Mojisola

bluedrop wrote: »

We refurbished our current home with a lot of love and attention to detail.

the idea of selling this house is breaking our heart.

We have money sitting in bank accounts (savings) and its doing nothing.

hazyjo wrote: »

Never ever rent out a house you're emotionally attached to/you love! Number 1 rule lol!

hazyjo is spot on!

If you're getting upset at the thought of selling the house, imagine how you'd feel if tenants didn't care for it as well as you do.

If you've got money sitting around not earning you interest, ask for advice on the Savings and Investments board.

Out,_Vile_Jelly

Take your time to find a bigger property, sell the existing one to a nice young family and move on. I'm fairly confident you won't give the old house much further thought.

Sentiment about a house is a really bad reason to become a LL, and not much fun for the incoming tenant.

Marvel1

bluedrop wrote: »

We refurbished our current home with a lot of love and attention to detail. However, its now too small for our family. We've been thinking of moving for a long time, but the idea of selling this house is breaking our heart. .

When going into the landlord business, this is never a good idea:
1. It will no longer be yours.
2. What if tenant damages something?
3. When you inspect and they done something you don't like, how would you feel? Bearing in my mind as long as they leave it as it was from day 1 - minus wear and tear it's fine.

bluedrop

Thanks all. Its not just the decor really.

Its the location, size and the price we paid for it. 10 minute walk to the station and within catchment for outstanding state primary and secondary schools.

If we were to sell this property, buying back a property of this size and location later will be hard.

Rambosmum

hazyjo wrote: »

Never ever rent out a house you're emotionally attached to/you love! Number 1 rule lol!

This with bells on!


How will you feel if a tenant trashes it? It's bad enough in a n investment property you have no emotional attachment to, but somewhere you consider home, it's heart breaking.



Plus being a landlord is hard, you have to go in to it eyes open to everything it entails. If you decide you do want to be landlords then buy a separate property for that (after buying the forever home, the stamp duty will be less that way round).

steampowered

bluedrop wrote: »

Its the location, size and the price we paid for it. 10 minute walk to the station and within catchment for outstanding state primary and secondary schools.

None of these factors are relevant. If you rent out the house, you are doing it as an investment.

If you had the price of the property in cash, would you buy a buy-to-let property in the same area to achieve a £1800 pcm rental yield? If the answer is no, it doesn't make much sense to keep the property.

If we were to sell this property, buying back a property of this size and location later will be hard.

This is only relevant if you think you might realistically want to move back into the house in a few years time. That sounds unlikely.

ReadingTim

bluedrop wrote: »

Thanks all. Its not just the decor really.

Its the location, size and the price we paid for it. 10 minute walk to the station and within catchment for outstanding state primary and secondary schools.

If we were to sell this property, buying back a property of this size and location later will be hard.

This doesn't make sense. You're selling it because it's too small. So why would you want to buy somewhere of its (too small) size again in the near future?

The only scenario would be downsizing - once the kids have grown up and moved out - which, given the average age of a first time buyer is late 20's/early 30's, could be a while; and frankly, who knows what will have happened in the intervening period.

What is certain however, is that amateur and small-scale landlording, is increasingly more onerous and less profitable. Sell up, and put the money towards somewhere just as nice as the current place, but bigger. There's plenty of them in zone 4. More in zone 3.... etc