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AIBU?

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Original poster

AIBU to ask if it would be a good idea to sell house and rent instead

138 replies

Telematics1234 · 10/02/2022 08:05

I have got this idea we could sell the house and put proceeds of house sale in the stock market.

We are in our late 50s and have paid off our mortgage. We are both still working. The idea of selling up and investing the capital in the stock market is appealing.

We are both still working, so have wages coming in to cover everyday expenses and rent.

I like the idea of the flexibility of renting. ie we could move house much more easily.

It seems to me that the stock market probably out performs the housing market for the most part.

Has anyone done this?

OP posts:
LorelaiDeservedBetter · 10/02/2022 09:50

They're two different questions. Would it make sense to rent? YY if you're bored and like the idea of living elsewhere and having flexibility. Lots of people do it but as a PP said, most keep their own house too. Hand it over to a letting agency.
The fact you put this:
It seems to me that the stock market probably out performs the housing market for the most part
means you shouldn't be selling your house and putting the money into stocks and shares. No-one with any financial nous would make a generalisation like that. They also wouldn't base any decision on 'probably'. Speak to a financial adviser. Rent a house if you want. Don't sell your house and put the money in shares. It's a very foolish idea for novices especially in the current market.

Whadda · 10/02/2022 09:54

I invest in stocks a lot and manage my own portfolio.

It’s so risky. My shares were doing very well, and then crashed due to Covid (I was too heavily invested in airline and hospitality-linked stock, my portfolio isn’t diverse enough which I knew at the time but they were performing very well so I was too slow to diversify). Literally wiped out all the profits I had made for the previous 6 years, and my principle took a hit too.

Thankfully, they’re crawling back up now but I still have a good way to go before I get back to the level of profit I had in late 2019.

The difference here is that I’m not dependent on that money. I’m younger than you, working full time, have savings and other investments, and own my own home (albeit mortgaged). I was lucky that I didn’t need that money at any stage in the past 2 years.

I would hate to be in my 60s with no income, at the mercy of the rental market, and watching my life savings ebb away in a volatile investment market.

Madness.

fruitbrewhaha · 10/02/2022 09:54

Why don't you remortgage your property to release some equity to invest?

godmum56 · 10/02/2022 09:57

@fruitbrewhaha

Why don't you remortgage your property to release some equity to invest?
OMG don't do this either!
StickyToffeePuddingAndIceCream · 10/02/2022 09:58

Hell no, downsize and invest the money from that. Who wants to be renting at 70 paying God knows what to live in someone else's property? I couldn't think of anything worse, I was so happy when we bought and our renting days were over.

LorelaiDeservedBetter · 10/02/2022 09:59

Don't remortgage. Don't do anything that takes equity out of your home. That's the best investment you have.

This thread is starting to read like those bitcoin scammers who are all over social media.

There's no easy way to make money. But there are millions of easy ways to lose it. And tbh you are more at risk of the latter than the former.

SpinningTheSeedsOfLove · 10/02/2022 10:04

@Velvetchocolate

Renting is horrendous at the moment anyway.
Agreed. It's dog eat dog out there.
nonono1 · 10/02/2022 10:06

Absolute madness IMO!

Owning your own property is also far preferable to renting - I hate being beholden to a landlord and having to ask somebody's permission to make home improvements.

Bogofftosomewherehot · 10/02/2022 10:07

@Redlorryyellowduck

Imagine being beholden to a land lord as you're in your 60s and 70s, not appealing. Downsize and pkay the stockmarket with your spare money if it appeals.
This!
Kennykenkencat · 10/02/2022 10:09

@Telematics1234

I have got this idea we could sell the house and put proceeds of house sale in the stock market.

We are in our late 50s and have paid off our mortgage. We are both still working. The idea of selling up and investing the capital in the stock market is appealing.

We are both still working, so have wages coming in to cover everyday expenses and rent.

I like the idea of the flexibility of renting. ie we could move house much more easily.

It seems to me that the stock market probably out performs the housing market for the most part.

Has anyone done this?

We sold our house and are actively looking for our next place so have gone into rented.

I don’t think that rented is a flexible option. If it was flexible you wouldn’t have to sign up for a year and not able to leave the commitment
I will probably be paying for this property for months whilst it stands empty.

I can’t switch gas and electric suppliers as we have to stay with an expensive tariff.
I have worked out that compared to my previous owned with a mortgage house this one is costing us nearly £2000 per month more and that isn’t taking account of the amount of work I have lost because the heating is so expensive we can’t afford to turn it on as it would probably cost £1000 per month.

Also go into stocks after a crash not when it is on a high
Buy low sell high. Not buy high and wait.

GizmosEveningBath · 10/02/2022 10:10

I planned to rent to test an area out before committing to buy, however there were 30+ applicants for every home so buying was the easier option (still had bidding wars etc).

Your home is your home first, investment second.

Whammyyammy · 10/02/2022 10:10

I thought the main benefit of home ownership is clearing the mortgage before retirement, to reduce outgoings in later life vs renting where you pay rent until you die?

Original poster
Telematics1234 · 10/02/2022 10:12

TBH we don't need to re-mortgage to get the money out of current home really. We took out an offset mortgage to buy this house. Therefore, although we technically still have a mortgage, there is sufficient funds in the associated offset account to pay off the whole sum of money owed on the mortgage.

In practice, we could therefore just take money out of offset account to get at the capital invested in buying the house.

We could obviously just downsize. However, what made me post this, was the giddy excitement that for the first time ever, we don't need to be tied to a specific area. DH works from home so can work anywhere. I have a professional qualification that means that I can work anywhere as more jobs in my field than people to fill them.

OP posts:
Original poster
Telematics1234 · 10/02/2022 10:16

@GizmosEveningBath

I planned to rent to test an area out before committing to buy, however there were 30+ applicants for every home so buying was the easier option (still had bidding wars etc).

Your home is your home first, investment second.

Yes, I have heard from people I know that it is difficult to source rented properties at present, so my idea wouldn't work unless this situation changes.
OP posts:
Crumbleburntbits · 10/02/2022 10:19

No, your idea is madness.

Orchid876 · 10/02/2022 10:19

As has been said already, it's a crack pot idea. But, there is an alternative to downsizing, you could buy a property to rent out then rent something else yourselves. If going down this route, I'd buy something that you'd potentially be happy to live in, should you need to. Then invest the rest if you want, but be prepared to lose it all, and obviously being a landlord won't be a picnic. But to relinquish all your property and put it on the stock market is madness.

Dillydollydingdong · 10/02/2022 10:21

Ridiculous. You've got no security if you rent. You say it would be more flexible - it might be more flexible than you want as the landlord could kick you out at any time. You could end up homeless and penniless.

Chely · 10/02/2022 10:22

Nah, not worth the risk for me.
Dh is allowed to use his extra cash to invest in stocks but I treat it like gambling, only what we can afford to lose can go on it. We can not afford to lose our home and renting in old age is shite.

Original poster
Telematics1234 · 10/02/2022 10:23

Oh well, you've all talked me out of it!

Back to the drawing board then!

OP posts:
milkyaqua · 10/02/2022 10:27

Insane. In the brain.

Whadda · 10/02/2022 10:28

If you’re looking for more flexibility around location while your husband works remotely, why not rent your house out for a year and then do a tour of places you want to go, using AirBnB?

AngelinaFibres · 10/02/2022 10:29

@AngelinaFibres

My husband and I are retired. He inherited a lot of money from his late father. We didn't need that money to fund our life so SOME of it is in investments.He is very good at it but....he spends hours reading relevant articles in financial magazines, he listens to podcast after podcast, he tracks the market daily. He takes part in at least one webinar a week from the investment platform he uses.That , and golf, are his thing.He spends hours on it. He has spread the investments around different world markets so lessen the risk. He has been very successful but we have benefited from the bear market of the last few years. That time is ending. We are well off and own a large house outright. If every investment went pear shaped overnight it would not affect our ability to live a lovely life. You would be absolutely mad to sell your house and risk that money. Low risk investments may save your capitol but won't make you any money. Moderate risk are not doing as well as they were and high risk is exactly that. You could lose the lot just as you get to retirement age and you have no house anymore.
This is me quoting me. It was a bull market .It now a bear. Avoid bears. I walked into the kitchen and told my husband ,mentioned in above post, what you were thinking of doing. He screwed his face up like a baby eating a lemon and said "NOOOOOOOOOOOOOOOOOOOO. They'd be utterly mad to do that'. We have moved everything into low risk investments and are currently in a holding pattern. We wont make any profit this year but we won't, hopefully, lose any. You must absolutely not need the money for anything at all and you must be in it for the long haul to invest in the stock market.Anything else is disaster.
Doris86 · 10/02/2022 10:32

Absolutely crazy idea. The housing market has proved to be one of the best investments over the past 20 years. Your money would be at much more risk in the stock market. My Grandad once lost over £100k in some banking shares he had.

Also having had your own house, the reality of putting up with regular rental inspections, not being allowed to put up pictures or decorate, and the ever present possibility of being given 2 months notice to leave, would be a bit of a shock,

bunfighters · 10/02/2022 10:33

You also don't seem to be factoring in if one or both of you became seriously or chronically ill and couldn't work, let alone have the energy/ability to move or manage stocks and shares. I have experienced this. Thank God I already have a mortgage and a roof over my head (and am much younger than you).

Sell now while the market is hot, rent (get that out of your system, it can be miserable!) while you find somewhere else that's smaller/cheaper, which will release some capital that you can play with... but only as much as you are prepared to lose.

MimiDaisy11 · 10/02/2022 10:39

I thought of moving into rental accommodation (to break chain before buying new place) as I thought we’d save money but rent costs the same if not usually more than mortgage payments.

Plus you say this I like the idea of the flexibility of renting. ie we could move house much more easily but unless you’re very minimalist then moving house is a pain and stressful regardless if you rent or own. Plus given the property market you can sell up easily. Granted there are no fees etc but still as someone who recently moved it’s not something I’m looking to do for a long while if ever.