Renting out primary home so you can live in a rental?

[PancakeCloud]

Is this a terrible idea?

Current home unsuitable (small flat with with two small DC) and has been on the market for over six months. We had a buyer early on who then pulled out due to their financial situation. We have dropped price twice already. Gearing up to drop price further but getting less money for our current home will make finding our next home more challenging, and so we’re considering alternatives.

We have done the maths and while not very efficient, we could afford a rental that would be suitable for now based on our current income and potential rental income for our current flat. Rental income approximated based on local market, understanding 10-15% will go to a management company, and net of tax. We would get landlords insurance, which I haven’t factored in yet.

Is this a terrible idea?

All of that is utter bollocks. Lots of evidence that landlords are selling - I've seen numerous studies. Also, of course, most with decent tenants will wait until they leave and then sell.

And not more difficult to evict??? What??? Section 8 can easily take 18 months or longer and cost many thousands in legal fees.

Righto

https://england.shelter.org.uk/housing_advice/eviction/section_8_notice_private_tenants/how_much_notice

What's the notice got to do with it? The court process, particularly if contested, can take 18 months, and then another six months or longer wait for the bailiff.

Yes but that’s due to backlogs in court and has been the case for years. It has nothing to do with the new legislation or change from section 21 to section 8.

as well as the risk, consider how you would end this. Can you afford to have it vacant for a year to sell at the end? Would you sell under sitting tenants? Or do you plan to rent for five or more years?

Yes that is the other thing, if you do get tenants in surely you’re just making it even harder to sell- because you’d either have to sell it with a sitting tenant, evict them
and then start viewings (and chances are they won’t have looked after it quite as well as you would have done), and you might have to exit the tenants.

I honestly think if you can give the flat a bit of a glow up and live with it for a bit longer that’s your best option. A garden isn’t essential if you can get to a park and at least your bills will be low- plus most box rooms fit small bunks if necessary (look at the ikea kura). In a couple of months the one of the various wars could have concluded and the market won’t be flooded with landlords trying to sell because of the new laws. Either stay for a bit longer, or reduce the price more and take the financial hit in order to move on.