Talk

Advanced search

Renting our house to rent another

(9 Posts)
Louloulouloubells Mon 02-Nov-20 10:59:17

Looking for some advice if anyone on mumsnet has rented out their own home to rent another house and the costs associated with renting out your house like tax or renting agency.
We are considering doing this as our own house is not big enough for us (unexpectedly pregnant) however we are not in a position to buy a larger house just yet and won’t be for a few more years.
Our thoughts were to potentially rent out our own home whilst living in another rented house and stay their for a few years until our circumstances have changed and we can purchase another accommodation.

I hope this makes sense English is not my first language!

OP’s posts: |
JoJoSM2 Mon 02-Nov-20 13:48:42

So you’d need to change the mortgage to a buy to let (higher interest). You’d need to pay tax on the income and allow for expenses such as maintenance and unexpected repairs. You don’t need to use an agency if you don’t want to.

You might want to consider the impact of how settled/unsettled you might feel living in rented rather than own house.

SilenceOfThePrams Mon 02-Nov-20 14:00:17

Friends do this.

Can you cover the mortgage on your own house as well as the rent if your tenants move out or stop paying rent? It could take a year or so to evict non-paying tenants and then cover any damages to the house.

safariboot Mon 02-Nov-20 14:03:59

Being a landlord isn't a passive investment, it's a business. With a single property you're at maximum risk from bad tenants.

And no, you can't just get a letting agent to handle it all for you. Legally you have a bunch of responsibilities and if the agent lets you down you'll be the one taking the penalties.

icecream2965 Mon 02-Nov-20 14:06:10

Also consider the fact that you may have lower earnings on mat leave. If anything happened and you needed to go back to your property could you afford to change it back from buy to let?

Also, make sure you have life insurance that covers the mortgage if you or your partner dies. My friend rented out her home on buy to let, moved into partners rented accomodation then he was diagnosed with terminal illness. She had no income to move back into her home.

icecream2965 Mon 02-Nov-20 14:08:17

Also that you are married. Moving from a mortgaged property to rented property when pregnant...you need to make sure you have security.

shinynewapple2020 Mon 02-Nov-20 14:09:14

I think you would really lose out financially by doing this .
Just clarify , so you currently own the home you are living in ? I can't see how it would benefit you to let that but have to pay out more on higher rent for a larger property.

What size is your current property and how many DC do you have?

Yamashita40 Mon 02-Nov-20 14:19:49

We did this as our house was too small and in negative equity. We rented from my dad so no risk of being evicted and we liked the house so much we then bought it off him. The renting out of our first house was not so straightforward. My dad had a letting agency so managed the house for us but he isn't the most thorough of people when it comes to vetting tenants as the houses he rents out are not houses he's lived in iykwim.
Out of 5 tenants we had one really good one, two reasonable ones although there were issues getting rent out of them at times and two really bad ones. The final tenant kept a number of animals and caused 4k worth of damage to a house worth 60k. The tenant worked by the way so don't think having a working tenant means they will be good. The best one we had was a single mother on benefits who was conscientious about the rent and a tidy person.

We sold the house this year and I thank my lucky stars that we did as the laws around evicting tenants are much rougher in covid times so if you have a bad tenant it's much harder to evict them.

As the house was in negative equity we didn't have to pay tax as the rent didn't even cover the mortgage payments. We got consent to let as we couldn't convert to a buy to let mortgage due to no equity.

I'd never rent out a house again, it really is not an easy option. My dad has had issues with almost half of his tenants at one time or another. Some are really good but quite a few have just stopped paying rent recently and blaming covid.

tectonicplates Mon 02-Nov-20 14:33:42

Being a landlord isn't a passive investment, it's a business. With a single property you're at maximum risk from bad tenants.

Thank you. Far too many landlords think you just buy/rent out a house, get some tenants in, and then you just sit there and collect rent and that's it. Being a landlord is an active thing - you have to be contactable, pay for repairs and maintenance, pay for big things like a new boiler if the current one breaks (it happens way more than you'd think). Also you don't get the same amount of money every month. You're supposed to budget for things like the property being empty between tenants, tenants who get behind or stop paying for whatever reason. And you're thinking of taking on tenants during a time when the economy is going down the pan and loads of people are losing their jobs, so even if they get references that doesn't guarantee their jobs are safe.

Join the discussion

To comment on this thread you need to create a Mumsnet account.

Join Mumsnet

Already have a Mumsnet account? Log in