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Original poster

Inherited property - sell or rent

47 replies

M0nstera · 12/08/2023 18:00

DH and I have recently inherited a property and are going round in circles trying to decide whether to sell it or rent it out. Things are complicated by me having a life limiting diagnosis. We want to ensure our family has the most secure future possible, but we also want to avoid adding extra stress to our lives. I know no one else can make the decision for us and there are pros and cons to both options but we'd like to get a range of views and ideas. I'll try and give all the relevant details but let me know if I've missed anything.

The inherited property is a 4 bed semi in a sought after location in England. No mortgage, and valued at around £335k in current condition. If we sell, at present the best option seems to be to put the proceeds in a high interest savings account paying around 6% interest.

We've been advised that if we rent it out we would need to spend around £5k on minor works to bring it up to scratch, we should then achieve a monthly rent of around £1,600. There's a shortage of rental properties in the area and the agent says it's an ideal family home.

DH and I are both in our 40's, with 2 DC. I have stage 4 cancer and due to this I'm currently working very part time and earning £10k per year (full time equivalent £50k). I'm hoping I will be well enough to increase my hours soon, but realistically I will probably have to drop back down again or quit my job altogether in the next few years or even sooner. I'm not likely to be alive to see my DC grow up. DH works FT for £55k.

We live a 4 bed semi in England currently valued at around £630k. We have a mortgage of about £180k, fixed for another 4 years at under 2%. We have savings of about £30k. Since I've had to reduce my hours we've not managed to add anything to our savings, we had to raid them recently for a new (second hand) car and we could really do with spending about £15k on our home.

What would you do and why? What might we not have considered?

Thanks for any input.

OP posts:
Badbudgeter · 12/08/2023 18:09

I’d sell. Being a landlord is stressful. The difference between rent and interest is negligible. Property prices aren’t going to shoot up in value anytime soon. Personally I’d take the easier option especially with your health.

If you really want to be landlords. It’d probably still make sense to sell and buy something easy to maintain/ manage close the home.

SwedishEdith · 12/08/2023 18:09

I'd sell it. Another house with all the maintenance and landlord costs that would come with it could, potentially, be pretty stressful. Is it a parental home and are any other siblings involved in the decision?

PeopleAreWeird · 12/08/2023 18:11

Sell. Pay off your mortgage, and you give up work

Frenchfancy · 12/08/2023 18:12

Sell, and pay off your mortgage.

You don't need the stress of being a landlord or doing the work necessary.

rosiebl · 12/08/2023 18:14

Sell. Quit your job. DH ask for a sabbatical from work. Go on a round the world adventure to maximise memories with your children. While you are are off adventuring, instruct a family member to project manage the updates on your own family home. When you get home, spend the rest of the inheritance on enjoying and maximising the time you have left, and pay off a chunk of your mortgage. That's what I would do anyways.

nevynevster · 12/08/2023 18:14

Had a rental flay for several years and I'd agree with the posters saying it's stressful. It is. Even if you have an agent you have to be on top of things and they do practically nothing IMHO. If anything goes wrong or it's void for a period of time, then you have all that added stress. Sell up and invest in your house and future

Happyhappyeveryday · 12/08/2023 18:16

I also think you should sell. Pay off your mortgage, have an amazing holiday or holidays and invest the rest for your family’s future.

Lookingatthesunset · 12/08/2023 18:16

I'd definitely sell. You can make use of the money to increase your quality of life and make memories with your husband and children.

I am sorry about your diagnosis. My SIL had a stage 4 diagnosis 11 years ago and didn't think she would see her DC grow up, but she is still with us, and her DC is going into 2nd year uni. I hope you also have years ahead of you xx

Summerswimmer998 · 12/08/2023 18:17

Sell it. Pay your mortgage off and go enjoy life while you can. My DB has had an investment property for the last 14yrs and is selling up now as it costs too much to run it despite having had a steady stream off good short term tenants as he mainly let it to student nurses/Drs as it’s near a big teaching hospital.

BorgQueen · 12/08/2023 18:19

Sell before you’re liable for CGT.

Invest your full allowances in ISAs, put some extra in your pensions.
High interest savings accounts are currently paying 6%, if you don’t work you can earn over £16k in interest before it’s taxable.

Batalax · 12/08/2023 18:19

Thats a very nice monthly income and you get a property that will appreciate over time (if you ride out the current slump)
however
It can be stressful being a ll. It helps if you see it as a business and approach it like you would any job, accepting there are always going to be problems to solve. If you would be stressed if the tenant doesn’t pay rent/court etc, then may be it’s not for you right at this time with all the stress you currently have. If you do go for it then use a reputable agent.

Would you be able to give up your own job? If that would help you then it might enable you to do that without eating into capital.

If you just want an easy life at this point of time, sell it.

Saschka · 12/08/2023 18:21

Sell. Pay off your mortgage. Improve your home. Stop work. Spend the time doing nice things with your children.

Caterina99 · 12/08/2023 18:23

Sell. Rental properties come with a lot of hidden stress and costs, and it sounds like you don’t need that in your life right now.

Motnight · 12/08/2023 18:24

In a similar position to you, Op, and we sold. My DH also has a life limiting illness and we want to avoid stress as much as we can. So renovations and being a landlord were out of the question.

My DH loves the fact that we have substantial savings, for the first time ever he realises that we will be financially ok if he has to give up work.

Hopealong · 12/08/2023 18:26

Absolutely sell and pay mortgage off. Renting property always comes with some level of stress and you really don't need this. Unless you love your job I'd think seriously about the money enabling you to give up work.

NancyJoan · 12/08/2023 18:28

I would sell. Get the work done on the house, have a great holiday, invest the rest.

aramox1 · 12/08/2023 18:28

Bear in mind tax on rental income and cgt when it's sold and building work atm is slow and expensive- sounds like selling might be best.

BorgQueen · 12/08/2023 18:29

It’s worth mentioning that if you have a DC pension ( so an actual pot that you control)
you can put in the maximum allowed from your earnings before you give up work and you can pass it on completely tax free ( for now, there is talk of changing the tax rules) to your spouse or children. They could draw a completely tax free income from it.

AHugeTinyMistake · 12/08/2023 18:30

Sell

Pay off the mortgage

Make necessary improvements to your house

Decide what to do with the rest of the money later

Renovating and renting out a property will be stressful and you don't need the extra stress. Being a landlord is not lucrative currently, it's not going to be 'free money' - renovations, hassle with letting agents, tenants, insurance etc. Just no.

Clefable · 12/08/2023 18:37

Agree with selling it. You don't need the extra hassle of a rental property for yourself or your DH/kids when you die. And then decide if you want to keep on working or do whatever you want to do. Money is freedom, and in this case you could make a decent amount from the interest from spreading it across ISAs and high interest accounts that will go some way to plugging any gaps from income. Then repay your mortgage when your cheap deal ends and that extra money can go into savings or for enjoying life. And definitely use some of it to have a fabulous holiday and family experiences for you all.

Fishmongers · 12/08/2023 18:44

Yep sell, sort your home out, have some life experiences together,

HappyHolidai · 12/08/2023 18:51

Another vote for selling, paying off the mortgage and having some financial security.

Depending on where you are in your 40s and what your prognosis is, pension contributions for you may not be appropriate: earliest age for accessing pension savings is currently 57 but will go up to 58 at some point. (There are some ill health provisions but you'd have to check your specific rules: I think you have to have a life expectancy under a year) However, ISAs and husband's pension may well be good to look at.

If the income from the money could replace your employment income, or you want to spend down the capital, you could give up work. Depends if you want to!

Lots of options, but absolutely I would get the capital available, improve your financial position as a family and not have the hassle and risk of being a landlord.

HappyHolidai · 12/08/2023 18:54

You might want to talk to a financial advisor- or befriend one and buy them some nice wine - to talk about the best things to do with the money. Stocks & shares give better returns on average over a long period than cash savings. A difficult question for you might be how to balance future capital to support the family with meeting your needs now. No mortgage will help that equation though.

mumda · 12/08/2023 19:03

Sell. It's your money then not a monthly stressed.

Louoby · 12/08/2023 19:29

I would sell the property and pay off your mortgage. Unless you really enjoy your job, I would give it up and enjoy life whilst you can. You have significant savings left to live off and also enjoy your time. X