Sell house or rent?
Discussion
Hi all
We’re in the very fortunate position to hopefully be emigrating to sunnier climbs soon.
We could either sell the uk house, or rent it out. My ponderings of the pros and cons are:
Sell, then invest the proceeds: Should easily get a 5% return. Obviously this could change with interest rates either way
Rent: rental value also seems to be about 5%. But then have the potential empty time looking for tenants. And some inevitable maintenance bills. But we’d also have the uplift in value on the house each year (although that could change of course)
Any thoughts on what’s best? Will still be uk based for tax.
Thanks in advance.
We’re in the very fortunate position to hopefully be emigrating to sunnier climbs soon.
We could either sell the uk house, or rent it out. My ponderings of the pros and cons are:
Sell, then invest the proceeds: Should easily get a 5% return. Obviously this could change with interest rates either way
Rent: rental value also seems to be about 5%. But then have the potential empty time looking for tenants. And some inevitable maintenance bills. But we’d also have the uplift in value on the house each year (although that could change of course)
Any thoughts on what’s best? Will still be uk based for tax.
Thanks in advance.
Drawweight said:
I would think most of the opinions on here would be to sell.
If you’re abroad you’re looking at a fully managed property which alone would make a dent in your income.
If you’re lucky you get a good tenant who pays up and stays for years. Unlucky? You’ve read all the horror stories.
Yep. Selling is the option I’m leaning towards. If you’re abroad you’re looking at a fully managed property which alone would make a dent in your income.
If you’re lucky you get a good tenant who pays up and stays for years. Unlucky? You’ve read all the horror stories.
On the face of it, I would sell but more information needed.
- what %age rental income might you achieve compared to property value? I read the 5% as being your expected you sold and reinvested the proceeds.
- what potential for capital appreciation in your current property?
- is there a realistic scenario that could see you return to the UK? Would stepping off the property ladder make getting back on a problem?
- what sort of property is it? Is it ready to be rented out or would it need a degree of rectification to enable this; e.g. would it pass an EICR?
I think if you are considering selling then you've probably already made your decision. I'm an "accidental landlord" of several properties because on each occasion I thought I may need to move back to them. I never have and it's produced a useful income but possibly in hindsight (and certainly in future) I would sell.
- what %age rental income might you achieve compared to property value? I read the 5% as being your expected you sold and reinvested the proceeds.
- what potential for capital appreciation in your current property?
- is there a realistic scenario that could see you return to the UK? Would stepping off the property ladder make getting back on a problem?
- what sort of property is it? Is it ready to be rented out or would it need a degree of rectification to enable this; e.g. would it pass an EICR?
I think if you are considering selling then you've probably already made your decision. I'm an "accidental landlord" of several properties because on each occasion I thought I may need to move back to them. I never have and it's produced a useful income but possibly in hindsight (and certainly in future) I would sell.
Countdown said:
If you're only getting 5% net yield then I'd suggest investing in bonds/equities instead. The hassle of tenants isn't worth any slight increase in income and that hassle will be multiplied if you're not in the Country to manage your tenants or your Letting Agent proactively.
The 5% figure was just based on easy savings accounts. In reality yes it could be invested properly for a larger return. Agreed with all
We were accidental landlords twice...and never again!
Many people do it & have hassle free experiences. Ours were fraught with every kind of issue. The problems were multiplied by our properties being 100 miles away, never mind in another country!
If you've a capital gain (on paper) you may need to think about the capital gains implications too if you turn your property to a rental.
Just our experience for what it's worth.
Many people do it & have hassle free experiences. Ours were fraught with every kind of issue. The problems were multiplied by our properties being 100 miles away, never mind in another country!
If you've a capital gain (on paper) you may need to think about the capital gains implications too if you turn your property to a rental.
Just our experience for what it's worth.
UpTheIron said:
On the face of it, I would sell but more information needed.
- what %age rental income might you achieve compared to property value? I read the 5% as being your expected you sold and reinvested the proceeds.
- what potential for capital appreciation in your current property?
- is there a realistic scenario that could see you return to the UK? Would stepping off the property ladder make getting back on a problem?
- what sort of property is it? Is it ready to be rented out or would it need a degree of rectification to enable this; e.g. would it pass an EICR?
I think if you are considering selling then you've probably already made your decision. I'm an "accidental landlord" of several properties because on each occasion I thought I may need to move back to them. I never have and it's produced a useful income but possibly in hindsight (and certainly in future) I would sell.
Also around 5% of the property value as rental income.- what %age rental income might you achieve compared to property value? I read the 5% as being your expected you sold and reinvested the proceeds.
- what potential for capital appreciation in your current property?
- is there a realistic scenario that could see you return to the UK? Would stepping off the property ladder make getting back on a problem?
- what sort of property is it? Is it ready to be rented out or would it need a degree of rectification to enable this; e.g. would it pass an EICR?
I think if you are considering selling then you've probably already made your decision. I'm an "accidental landlord" of several properties because on each occasion I thought I may need to move back to them. I never have and it's produced a useful income but possibly in hindsight (and certainly in future) I would sell.
Don’t foresee coming back to uk but you never know. Getting back on ladder not necessarily a problem if the money invested has made a better return than any increase in uk house prices.
Ready to rent except a bit of decorating.
It may not be the easiest property to rent; three storey with lounge and kitchen on middle floor. Also quite a large property but with virtually no garden.
The pendulum has been swinging against landlords for a good few years now. Unless you're experienced or prepared to sign up for full service property management, I'd give it all a wide berth and sell.
Also, would you be keeping any other assets in UK? If not, does having a rental property in UK and nothing else just make things a bit messy re tax/returns etc. For me there's something to be said for simplicity.
Also, would you be keeping any other assets in UK? If not, does having a rental property in UK and nothing else just make things a bit messy re tax/returns etc. For me there's something to be said for simplicity.
I would not rent out a former home: too much emotional connection to the property.
You expect wear and tear, even outright damage, with rentals but it’s harder to deal with that if it’s your own former home.
Personally, I’d mothball it for year to see how living abroad worked out and then sell if it didn’t look like I was coming back.
You expect wear and tear, even outright damage, with rentals but it’s harder to deal with that if it’s your own former home.
Personally, I’d mothball it for year to see how living abroad worked out and then sell if it didn’t look like I was coming back.
elise2000 said:
Hi all
We’re in the very fortunate position to hopefully be emigrating to sunnier climbs soon.
We could either sell the uk house, or rent it out. My ponderings of the pros and cons are:
Sell, then invest the proceeds: Should easily get a 5% return. Obviously this could change with interest rates either way
Rent: rental value also seems to be about 5%. But then have the potential empty time looking for tenants. And some inevitable maintenance bills. But we’d also have the uplift in value on the house each year (although that could change of course)
Any thoughts on what’s best? Will still be uk based for tax.
Thanks in advance.
It's the long term aspect that's most relevant to be honest. We’re in the very fortunate position to hopefully be emigrating to sunnier climbs soon.
We could either sell the uk house, or rent it out. My ponderings of the pros and cons are:
Sell, then invest the proceeds: Should easily get a 5% return. Obviously this could change with interest rates either way
Rent: rental value also seems to be about 5%. But then have the potential empty time looking for tenants. And some inevitable maintenance bills. But we’d also have the uplift in value on the house each year (although that could change of course)
Any thoughts on what’s best? Will still be uk based for tax.
Thanks in advance.
Retaining the money in the shape of a di for property asset is hard work for the yield and that yield is fairly unstable, risk wise.
Holding the wealth as blue chip equities gives a more stable yield while potentially have more capital risk on the surface but really not being much different other than in rate of potential change both down and up.
Where many Britons made an issue for themselves when moving to places like Spain when they sold their UK property was that they needed that money in order to live overseas. If you do not need that money for that purpose and it can just remain sitting as an investment then it becomes a much simpler and easier proposition as you don't really have the same downside risk of not being able to buy back in if desired.
Unless only going for a few years then I'd personally favour swapping out of a single risk property investment into a blue chip equity portfolio even at current highs.
It breaks any ties to where you currently live meaning should you decide to return you are completely free to pick any part of the U.K. that you wish. You are able to move your wealth easily if required. You have no need to trouble yourself with U.K. politics for the duration of your time overseas.
Personally, I think property values have to fall anyway. The Boomers will all start dying off in the 2030s and all their homes steadily hit the market but more esoterically no civilisation has survived excessive costs of living. When housing, food and warmth consume too much of a working person's income then it is a given that you have a rise in social anger, a rise in political extremism and the inevitable revolution or collapse of some basic form or another. It's why after the two world wars the U.K. embarked on massive house building programs to ensure real workers had genuine social protection. My view is that we have had 25 economic boom years where the extreme left was left to grow as no one gave a crap as money was easy so everyone was relaxed but the sudden change in that money has not just revealed that society let the extreme left grow too large but now we have the inevitable growth of its lover the extreme right. The only way a society can disarm the extremists is to rob them of their cannon fodder for the war they desperately desire. The only way to deny them their armies of storm troopers is to simply ensure that people who choose to work can pay their basic essential monthly costs and have wealth remaining that allows them to build a dream whether that's saving for a different future, investing in a child's future or simply buying some trendy pants. And that means that housing costs for normal, lower end workers must come down and the flawed rhetoric and false premise of 'pay rises' end. Global, blue chip equities are wholly free of such social and political burdens.
Chrisgr31 said:
Someone I know moved from Bristol to the UAE 25 years ago selling their modern house in Bristol docks. The capital value increase would have exceeded any other investment significantly.
However it is very dependent on location etc.
We are in a town right and the house is right by the sea. Not an expensive town though. However it is very dependent on location etc.
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