Should I sell my let house?
Discussion
I have a property let but now 2months notice given which is on the banks svr - we used to live there and I managed to get permission to let from our residential mortgage thus no fees just svr which is 4.5%. I'd guesstimate the value to be around to £250k it's in good nick. So now I need to decide do I readvertise it and find some more tenants but that will mean a 6months to a year a scenario. If I go for a buy to let mortgage fees will be roughly £4-5k and the rates much higher than my current svr.
So should I sell that one now - I have a number of properties the others are on long term buy to let's fixed deals so it is only this one. Due to getting permission to let on what was a residential mortgage it's mortgage interest means I make no profit on it but that's purely due to the fact we took equity out and have used that as the deposit for our current residential property.
the worry is I let it out for a year and property values fall or the svr rises or after a year cannot find replacement tennants plus the other two things happen. The other thing is we do not have 60% ltv so if I were tp switch to a fixed buy to let I'd need to pay for the fees and also put in cash.
The other option is of course sell it and dump the equity I have in it in my offset mortgage either as a short term thing or long term to clear home mortgage sooner than later.
So should I sell that one now - I have a number of properties the others are on long term buy to let's fixed deals so it is only this one. Due to getting permission to let on what was a residential mortgage it's mortgage interest means I make no profit on it but that's purely due to the fact we took equity out and have used that as the deposit for our current residential property.
the worry is I let it out for a year and property values fall or the svr rises or after a year cannot find replacement tennants plus the other two things happen. The other thing is we do not have 60% ltv so if I were tp switch to a fixed buy to let I'd need to pay for the fees and also put in cash.
The other option is of course sell it and dump the equity I have in it in my offset mortgage either as a short term thing or long term to clear home mortgage sooner than later.
The wife is very much for offloading the house bank the cash/put it into the offset a/c, basically the amount of equity I have assumed based on selling price would mean that our mortgage would decrease term wise by 7.5years or if we wanted to pay our mortgage off early 9yrs11months. Note as we just about 1 year in then it would mean a potential mortgage free by 8yrs11months.
Its very tempting.
The reason we held last year than sell was I was reluctant to sell at what I presumed to be the bottom of the market and wanted to wait for prices to rise to as high as possible then sell. Given I truely believe it could be sat at near on the £250k mark for some time as is usual for the tier especially with the 0% up to £250k and 2% thereafter to the next tier it would be a very material step up for a would be buyer i.e. guessing best part of £300k.
Im very exposed to the banking sector as is so wouldnt want to skew it further + in 2008 I lost best part of £70k in HBoS so now purely have the shares I physically had before in that sector and being quite burnt about it and literally living in hope that it would turn round at £3.00 that would be the bottom but sadly no it was c£0.50 ... Anyway in the offset current rate as Im a higher tax payer the effective interest rate I'd have to earn risk free would be 6.3% doable for sure but not 100%. Plus the wife would kill me this time if I lost another slug of cash on gambling.
Its very tempting.
The reason we held last year than sell was I was reluctant to sell at what I presumed to be the bottom of the market and wanted to wait for prices to rise to as high as possible then sell. Given I truely believe it could be sat at near on the £250k mark for some time as is usual for the tier especially with the 0% up to £250k and 2% thereafter to the next tier it would be a very material step up for a would be buyer i.e. guessing best part of £300k.
Im very exposed to the banking sector as is so wouldnt want to skew it further + in 2008 I lost best part of £70k in HBoS so now purely have the shares I physically had before in that sector and being quite burnt about it and literally living in hope that it would turn round at £3.00 that would be the bottom but sadly no it was c£0.50 ... Anyway in the offset current rate as Im a higher tax payer the effective interest rate I'd have to earn risk free would be 6.3% doable for sure but not 100%. Plus the wife would kill me this time if I lost another slug of cash on gambling.
B17NNS said:
Dump it while you can.
Put the cash into Lloyds shares.
Wait for the 'real' houseprice crash by which time your shares will be worth double.
Thats a joke, right? Put the cash into Lloyds shares.
Wait for the 'real' houseprice crash by which time your shares will be worth double.
must be. no-one in their right mind would think that lloyds would double in value while house prices crash
that would be ludicrous
Dave_ST220 said:
Sell it & dump all the loot in an offset. You would be a fool not to. You can access that money at any time you like, it just sits there reducing a debt tax free.
ST220 - Im trying to find a reason not to sell it and every which way I look at it I cannot see the logic given the scenario I have illustrated.Dave - as a side note I could be wrong but are you not a Reading based person with a Blue ST220 with a very memorable number plate... who uses the Caversham Park Village bypass/Henley Road up to Emmer green which avoids all the traffic ...
I would be in agreement with your wife, in fact I am waiting until approximately June/July before I myself offset two properties. All of my properties I purchased back in the 80’s, and I can’t see any substantial capital growth in properties purchased over the last two years, and also rental income in many instances both not covering the mortgage repayments and certainly not variable against the capital value of the property.
I am going to wait a few months, just in case the new government does something with CGT, then I will being doing just like your wife suggested you should be doing.
I am going to wait a few months, just in case the new government does something with CGT, then I will being doing just like your wife suggested you should be doing.
Gassing Station | Finance | Top of Page | What's New | My Stuff