Should I give up & sell my rental property?

[accidentalgrownup]

Just that really...

I've owned a house since before I met DP and when we had our first DC we struggled to sell it.

Currently I rent it out & we rent a larger property as it only has one bedroom.

I've on my fourth tenant in 3 years and they have just handed their notice in not sure where I'm going wrong, 2 of the 4 have got council properties and 1 has got a live in job.

Is it just bad luck or is this kind of turn over normal? It's a bungalow in a northern seaside town. Do I get try to sell again? Put the rent up/down? I don't think we'd get a mortgage for the kind of house we live in now.

Get the house you own revalued pronto - the amount of equity you now have in it may be surprising (given rising house prices) and selling it could give you enough of a deposit that you could afford a mortgage on the size house you've got now. HOWEVER, if you sell it, I would move back in for about 8 months then put it on the market and sell it, as that way you'll get Capital gains Relief on the profit, because you'll be reinvesting the sale proceeds into your own next home( you have to have lived there a certain amount of time). If you're getting profits from essentially a buy-to-let, there is no such protection.
If you want to keep it, if suggest a friendly and open conversation with your current tenants and a couple of Estate agents in the area to get their ideas on why tenancies are failing.

Do you allow housing benefits? Us scum are much more grateful and desperate for a long term family home. We've been in ours for 11 years, though we were not considered worthy of it first off and had to wait till some more worthy types had been in it 6 months, gave it a damn good roughing up and contaminated it with fleas from an undeclared cat.

I will get it revalued Jonty, can't move back in though as we love the property we're in, it's not in the same place as the rental & just round the corner from DCs school.

Plus there's 4 of us now...bit of a squeeze in a one bed!

On a more constructive note, have you asked your tenants why they aren't staying?

It might be useful to ask them to be really honest about the house and what did or didn't work for them.

Ha ha, I really don't mind if 'you scum' rent it fauxpas but the two lots of tenants I've had on benefits have been given council/HA properties.

It's a lovely house with new double glazing & carpets etc, last time it went up I had 3 viewings lined up within 48 hours.

I guess it's just a bit disheartening, and expensive in EA fees!

Sounds lovely. I would love to live at the seaside....

I think I will when I see them penguin, this latest one just said they'd be daft to turn down the offer of a live in job which I can understand.

I'd still live there if I didn't have to fit my family in

We've just had the tenants move out of our rental house and we are going to sell it. Had it for years, but sick of the hassle of the whole thing and having to redecorate every couple of years after it's been left in a filthy state.

We did the same as you for a while. But due to not being able to remortgage in a timely fashion (nothing wrong with the finances just the freakin bureaucrats are useless), I decided enough was enough and sold. The relief has been great - no admin and maintenance of the property and dealing with tenants moving on. Had bought another house in the meantime and could then pay off the mortgage with the rental. I doubt financially it makes much sense to keep the rental - rules changed last year mean you are taxed on the entire income of the property rather than the profit. So that's a whole lot of additional expenditure on top of things like management fees, maintenance, inventory checks etc..

I agree with flying I work but have to have a housing benefit top up. No chance of a council property. I pay full market rent. I lived in my last property for 10 years and would like to live in my new oneforever

True sycamore, I've redecorated that place more times then I ever would've if I lived there.

Can I ask how long most of your tenants have stayed?

We've just served notice on our tenant as we plan to sell. Hopefully so we get somewhere permanent ourselves. I think if you've got your own home and you use rental as investment it can be OK but not as an 'accidental Landlord'. It's too much hassle.

I had the same tenants in for a few years but they were paying well under market rate for the area, which had increased in cost in that time. I hadn't put the rent up as they were long term (though I did have to do a complete refurb when they left). They left in the end as they had a job offer abroad. I did nearly sell it but given the area is improving and is commutable to London, I decided to keep it. Current tenant wants to stay long term but I suspect his work situation won't allow it.

If it's in a seaside town, would you be better by doing it as a holiday let?

Interesting to hear your thoughts, thanks everyone.

Deep down I don't think I'm cut out to be a landlord, I get a sinking feeling every time I see it's the tenants ringing / texting.

I've tried using an EA to manage but found it a waste of money as DH has a number of friends in different trades. I do use one to find a tenant in the first place though.

DH says one last try as at least taking someone on now should at least take us through Christmas. Wish us luck!

I don't think so blankie, i wouldn't want to commit to being there weekly to let holiday makers in & clean etc. Plus we'd have to furnish it. Something to consider though thanks

The longest let was three years, last tenants were one and a half years.

We are concerned that interest rates may rise within the next year, and also that there may be a labour government in the near future who could increase capital gains tax. It seems the right time to sell to us.

I'm a new-ish LL too with a currently vacant flat in London. I am finding it hard work, and don't know if it is simply the market (Brexit uncertainty, etc), or if my EA is doing a poor job.

I'm being told by my EA that there is a glut of property on the market atm, which means tenants are picky and slow to move. When they finally make an offer, it is often a cheeky one.

Do all you landlords advertise at the same rent as paid by departing tenants, or do you ask for a higher rent when the property is back on the market? Just wondering, as most people seem not to put the rent up once they have a good tenant in place. Also wondering as now I'm hearing that rents are actually falling, so properties are renting for less than previously.

I kept the rent the same for five years for the previous tenants but upped it to market rate for the area for the current tenant. I would market it at what the local going rate is.

Which seaside town is it OP?

I'd put it on the market now. With it having been your home in the past and given it has only one bedroom, it's unlikely the CGT liability will amount to much once you have offset your allowance anyway. If you can sell it then you can look to buy your own place before interest rates start going up, etc.

Earlybird, I do think realistic rents are probably key to letting quickly in London now. I have a flat in SW London, let to the same tenant for nearly 5 years now. Until last year the letting agent was urging me at every renewal to rise the rent, which I never have, since I am lucky to have a very good tenant and I thought the rent was fair.

But I think it's indicative that the LA (a fairly big name in the area) is no longer pressing me to - they of all people must see that rents are coming down. I keep a close eye on the market and there are a lot of reductions, albeit often from what to me seem like very greedy initial asking rents, especially since so many of the properties were bought well before prices rose to the current crazy levels.

I've never increased the rent whilst I've had tenants in but last time I advertised it went up slightly on the advice of the EA.

For comparison I ask £475 pcm which I guess will be a relatively small amount compared to rents in the south.

Thanks for all the replies, after sleeping on it I've decided to hang onto it, my EA is enthusiastic & is very positive about finding a new tenant before the old one goes.

Depending on the area, if it is in the north, it is possible the market has not risen at all and it will still be very difficult to sell (our experience).

Sounds like it could be perfect for an older market. Is there anything you could to to make it more appealing (or state you would be willing to make adaptations if required). They would be much more likely to stay longer term then too. good luck.

A previous property in the south east long before brexit had a different rent for each tenant. When there was demand, the tenants competed and made a higher offer. When the market was slack, the rent was lowered to get a tenant and stayed that way.

Renting was cheaper than a mortgage at the time due to higher interest rates. And no, this is not in pre history.

Tenants move on, the nature of renting. If the market has slowed, drop the rental. If you can't afford to do that, sell up.