Amateur bob Posted August 14, 2023 Share Posted August 14, 2023 good afternoon im looking for advice if anyone can offer their opinion, im in a situation just now where i have just moved from my old house which was too small into a larger rented one, i own the old one outright and have just gained planning permission to build a house too, im at a crossroads now do i rent the old house out to help pay my rent while i organise the housebuild(which could take a couple years) or do i sell and put the money into savings and collect 4-5% interest? the only issue with renting out is getting a tenant back out and house prices dropping....likewise house prices could continue to rise and i could miss out on that and the rent money any advice appreciated thanks Link to comment Share on other sites More sharing options...
twice round the block Posted August 15, 2023 Share Posted August 15, 2023 Currently 17% of houses for sale on rightmove are ex rental properties. Be prepared to get it back needing a refurbishment before you can sell it. Your house your risk. Personally I think it's had it's day, and it's about time the government got to grips with the social housing crisis, it's not down to private landlords. 2 Link to comment Share on other sites More sharing options...
ProDave Posted August 16, 2023 Share Posted August 16, 2023 I had this "problem" just after we started our build, the trouble was, when I tried to sell, the housing market was still dead following the financial crash, and it did not sell. So I reluctantly took up an offer to rent it. It was the least bad option as it was not going to sell in a hurry. In your situation now, I would put it on the market and see. If it sells, that's great, end of your problems. If it does not sell or has little interest then I might consider letting it. BUT and it's a very big BUT, do you WANT to be a landlord? If the answer is no, then don't become a landlord. Frankly the rules have changed and are likely to change further in the favour of tenants, and you might not be able to get your house back when you want to, or it may take a very long time, and it most likely will not be in the condition you expected it to be when you do get it back. For a start what EPC does the old house have? If it's worse than a C then you WILL have to spend money to upgrade it sooner or later or you won't be able to let it. And why are you renting now? Is there not room on your plot for a static caravan? 2 Link to comment Share on other sites More sharing options...
Bitpipe Posted August 16, 2023 Share Posted August 16, 2023 Agree with @ProDave - we became accidental landlords back in 2011 when we bought the house that was eventually demolished to make way for the new build. Sale market was v slow back then (which worked in our favour for the purchase) and the finances were not that complicated to arrange. We let the original property easy enough as it was a fairly 4 bed new build, but it was still a big PITA and it looks like it has got worse by an order of magnitude since then. in 2011 we were able to offset the mge payments against the rent to minimise the tax impact (gone as an option now) but still had a bill to pay when we eventually offloaded it on the captial gain as it's no longer your main residence. Also, very difficult to sell a house with tenants in it as it never looks its best. Ours only shifted when it was unoccupied, neutrally redecorated (especially kids rooms), every room dressed with simple furniture (lots of freecycle couches and bed frames, inflatable camping mattresses under empty duvet covers etc,, ) big non functioning flat TV in living room, dining room set for dinner etc - all the show home BS but it worked! 1 Link to comment Share on other sites More sharing options...
Mr Blobby Posted August 16, 2023 Share Posted August 16, 2023 How much do you think the value of your house will increase over the next year? More than the 4.5 % you can get in interest? Or will it perhaps lose more value than the rent you could get? Exactly. Sell it. Link to comment Share on other sites More sharing options...
JohnMo Posted August 16, 2023 Share Posted August 16, 2023 Been there done it, really wouldn't bother again. Sell it move on, have the cash in the bank, so you can use when you need it. It can take you 4 to 6 months to sell and have the cash in hand, even if you started making moves today. 1 Link to comment Share on other sites More sharing options...
Iceverge Posted August 16, 2023 Share Posted August 16, 2023 Yup, sell it. Trying to build one house is stressful enough without having to look after an old one at the same time. 1 Link to comment Share on other sites More sharing options...
PeterW Posted August 17, 2023 Share Posted August 17, 2023 Sell - You’ll have CGT to consider at a later date too which really complicates things Link to comment Share on other sites More sharing options...
Amateur bob Posted August 17, 2023 Author Share Posted August 17, 2023 On 16/08/2023 at 08:48, ProDave said: I had this "problem" just after we started our build, the trouble was, when I tried to sell, the housing market was still dead following the financial crash, and it did not sell. So I reluctantly took up an offer to rent it. It was the least bad option as it was not going to sell in a hurry. In your situation now, I would put it on the market and see. If it sells, that's great, end of your problems. If it does not sell or has little interest then I might consider letting it. BUT and it's a very big BUT, do you WANT to be a landlord? If the answer is no, then don't become a landlord. Frankly the rules have changed and are likely to change further in the favour of tenants, and you might not be able to get your house back when you want to, or it may take a very long time, and it most likely will not be in the condition you expected it to be when you do get it back. For a start what EPC does the old house have? If it's worse than a C then you WILL have to spend money to upgrade it sooner or later or you won't be able to let it. And why are you renting now? Is there not room on your plot for a static caravan? i think i could be tempted to sell i have no real wish to become a landlord and as you say there could be a cost involved in letting it, the reason for renting is that a house came for rent near my work and if the build doesnt materialise i was needing a 3 bed house anyway rather than my current 2 bed, the interest i will get on savings once house sold will go a long way towards paying my rent Link to comment Share on other sites More sharing options...
Amateur bob Posted August 17, 2023 Author Share Posted August 17, 2023 On 16/08/2023 at 16:53, Mr Blobby said: How much do you think the value of your house will increase over the next year? More than the 4.5 % you can get in interest? Or will it perhaps lose more value than the rent you could get? Exactly. Sell it. not sure mabye some property people in the know on here can advise? central scotland 2 bed terraced house rough value 130k currently Link to comment Share on other sites More sharing options...
Amateur bob Posted August 17, 2023 Author Share Posted August 17, 2023 5 hours ago, PeterW said: Sell - You’ll have CGT to consider at a later date too which really complicates things yes ill be free of that worry if i sell now? Link to comment Share on other sites More sharing options...
Pocster Posted August 17, 2023 Share Posted August 17, 2023 As a full time LL my advice ( although CGT ) is sell . The rules are stacked against you as a LL - making it at best difficult and at worst impossible. I’m stuck in LL world as it’s my only income - but have to adapt to the new ‘ presumed ‘ and current rules / regs . No one in their right mind would choose to be a LL now - which is exactly the reason I stay …. But for ‘amateur ‘ ( no dis-respect intended ; I.e not full time ) - it’s a sea of mess - sell it - take the CGT hit and move on . Link to comment Share on other sites More sharing options...
Amateur bob Posted August 17, 2023 Author Share Posted August 17, 2023 1 minute ago, Pocster said: As a full time LL my advice ( although CGT ) is sell . The rules are stacked against you as a LL - making it at best difficult and at worst impossible. I’m stuck in LL world as it’s my only income - but have to adapt to the new ‘ presumed ‘ and current rules / regs . No one in their right mind would choose to be a LL now - which is exactly the reason I stay …. But for ‘amateur ‘ ( no dis-respect intended ; I.e not full time ) - it’s a sea of mess - sell it - take the CGT hit and move on . how will i have to pay capital gains? i lived in it for 11 years and only moved out 2 weeks ago? 1 Link to comment Share on other sites More sharing options...
Pocster Posted August 17, 2023 Share Posted August 17, 2023 8 minutes ago, Amateur bob said: how will i have to pay capital gains? i lived in it for 11 years and only moved out 2 weeks ago? Sorry - my bad ! No CGT !!! 👍👍👍👍👍 Link to comment Share on other sites More sharing options...
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