I’m an accidental landlord and rent out my old London home. I’ve just had my first tax bill since becoming a landlord and am wondering if the stress and expense is worth it. Would love your thoughts based on following:
- my property income has pushed me from a basic into higher rate tax bracket
- I’m on an interest only mortgage of around £230,000 for the rental. I was planning to overpay on this each year but high tax making that tricky. After tax, mortgage, expenses I’m ’making’ around £2k per year
- I have no pension pot and so my hope was the 2nd property would be an income and asset in my old age.
- if I sold it I would make around £200,000
My question is, do I keep it and try somehow to pay the mortgage down and play the long game. Or do I sell?
If I sell, what could I do with the £200k that would give me more security in the future (and maybe even benefit my family in the meantime). I was brought up with the idea that investing in bricks and mortar was the best thing you can do but everything seems stacked against that at the moment. Any thoughts/suggestions would be amazing. Thanks.