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Small house plus buy to let, retire earlier vs dream house retire later

5 replies

Housethinkings · 29/09/2020 11:26

Just that really

WWYD?

OP posts:
Reedwarbler · 29/09/2020 12:45

If you are asking what I think you're asking (which isn't that clear), why would a buy to let enable you to retire earlier? Are you assuming property values will continue to rise? It seems to me a lot of landlords are anxious to offload btl's at the moment. Then there is the possibility of massive unemployment which could also affect your letting ability, leading to expensive void periods.
It's a problem because there is virtually nowhere to invest money for growth at the moment, we have decided that money which is earning virtually no interest would be better spent on moving house and upgrading, so I would take the second option....possibly. Hard to say really, so sorry, not much help.

Housethinkings · 29/09/2020 17:35

Sorry yes I wasn’t clear.

why would a buy to let enable you to retire earlier? was thinking rent would pay mortgage so would increase equity and sell in future

Compromise would mean being in a much smaller house until then (but live able and could make nice)

OP posts:
Reedwarbler · 29/09/2020 19:02

I think in your situation I would speak to a (very good) financial advisor because there may be funds where you could put your money away for some time that may give you growth. We have invested like this, and were pleasantly surprised how thorough the advisors were. And yes, we had growth in the capital, well over and above what is available on the high street (currently virtually zilch). However, this was a few years ago.
I sometimes wish I knew more about art and antiques because I think that is where there is money to be made, but, I digress. To me, the problem with mortgaged btl property is that the goverment has taxed it to the hilt, and, if you are managing it yourself, it can be a lot of hassle. Otherwise you will have to pay to have it managed, which eats into profit. Then there are the dreaded voids or troublesome tenants to contend with.
I don't know the answer I'm afraid. The only thing I can say is that life is short and it is better to enjoy yourself now, rather than waiting for some random time in the future when everything comes together (one hopes). Buying a property as a pension is very much 'eggs in one basket' to me.

ladybirdsarelovely33 · 29/09/2020 19:07

How many years until you retire or potentially retire?
I think if you have a long way to go, then there is a lot of potential in property

pinknsparkly · 29/09/2020 19:37

We've opted for the cheapest house that had enough bedrooms for us and wasn't in a terrible location that we could comfortably afford on a single salary rather than maxing out our mortgage to.get a larger house. The main reaaon was to give us options. We were intending to TTC (and she's currently 2 months old!) and that meant we could have one of us be a SAHP if we wished/ would survive if one of us lost our job. As a PP has suggested, we're then investing in the stock market with a view to retiring early.

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