Does it make sense to rent rather than buy?

[Eggs]

We currently are renting the family home, we have 2 other investment properties - one not in this country. We would like to buy the home we live in, however cannot afford to, even if we sell the other properties. This is due to the location of where we live now, very high property prices. We have money to invest so my question is would it be better to purchase 2 more investment properties and keep on renting, or liquidate all our assets and look for a property to live in. Bottom line - is it better to own your home and have no investment properties, or have no investment properties and rent your home. Also I have 3 children, and currently if we could purchase another property as an investment we would have 1 to give to each of them in later years. Any advice would be great.

[prepperpig]

Personally I think you're crazy and would not want to be throwing money away renting but it entirely depends on the value of the properties, the rental yield etc. Nobody can answer that question without a lot more information. It might for example be the case that the properties are too small for your needs as a family but the rental income pays the rent on your current home even after income tax and the capital gains tax you will pay when you sell the rental houses.

[ReallyTired]

In the UK you have to pay capital gains tax on properties you do not live in. It is a no brainer to have lots of investment properities, but not own the property you live in, unless its short term. I suppose you could keep your captial gains tax liablity down if you eventually move into one of your properties. I would be very surprised if you could get a buy to let mortgage. Generally you need your own property and at least an income of 25K.

[lljkk]

What do you mean 'give' to your offspring. You won't own them completely outright without mortgage, will you? You mean a BTL property where you've made the minimum deposit & you're relying solely on property price rises to make long term profits?

Do you have other investments? Why put your whole portfolio into the property market which can go down as well as up, why not diversify your risk exposure?

Is there really no way you couldn't afford to buy a smaller home than your ideal, to get the full advantages of zero capital gains tax on main residence, and hope to buy a larger home in 5-10 yrs?

[Eggs]

Thank you for all your advice. Still not sure what to do...

[prepperpig]

Sell the investment properties and use the proceeds plus the other money you have available to buy a family home with a mortgage.