Avant
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Post by Avant on Oct 25, 2020 16:49:58 GMT
Is the house big enough to be converted into two flats itself, rather than selling and buying? If so, it might be worth doing the sums to see how the costs of conversion compare with those of selling and buying.
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Post by Humph on Oct 25, 2020 17:46:50 GMT
No, not really Avant, it's just a wee 3 bed semi. Quite a nice little house in a pleasant residential area. Parking for three cars, good sized garden. Ideal starter home or first step up from a flat maybe for someone. But it did need a bit of work, we last decorated it about 10 years ago and everything needed re-doing. Just the understairs cupboard to do now and the inside is done, well, apart from refitting curtain rails etc. Actually I need to replace the central heating timer switch thingy too come to think, still sort of works but it's a bit random, and the toggle switch thing for the electric shower, and the riser rail for the shower head...maybe I'm not all that finished...
Fair bit to do outside, garden/patio is a bit of a mess. Three different shades of fence paint at the mo. We trusted the letting agent to have had that done properly when the fence blew down last year, but it's all a bit cobbled together. Not sure what we were paying those robbing beggars for actually. We hadn't actually been to the house for years and were just paying them to fix it up as and when they said it needed it. Their view of what constitutes "kept in good order" differs somewhat from mine.
Downstairs has tiled or laminate flooring which is fine, and the bathrooms have tiles so they're all good but it needs new carpets on the stairs and in the bedrooms.
Just been and done the last coat on the upstairs doors etc this afternoon, and the bannister. I now hate the person who invented "spindles" by the way. There must have been a better solution.
😉
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Post by dixinormus on Oct 25, 2020 19:00:23 GMT
If you live locally to the property, can you dispense with the letting agent and manage the property directly yourself? That might boost its profitability.
Another angle to consider: would you consider living in the rental property yourself in retirement, i.e selling your primary residence and downsizing when the time is right? That might affect some of your decision-making (and maths!)?
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Post by Humph on Oct 25, 2020 22:05:56 GMT
Wouldn't want to live there by choice Dixi, but self management is an option I guess.
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EspadaIII
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Post by EspadaIII on Oct 26, 2020 8:54:53 GMT
From experience, letting agents (including my own run by Espadrille) always seek to spend the least simply because most landlords want that. Very few will say, "make it as good as I would like if I wanted to live there.".
You could self-manage but what about the call at 10pm, saying the boiler has stopped working? There are options to deal with that, mind...
Maybe visiting annually will be beenficial to keep the house in better average condition, rather than a huge job every ten years. Consider it like painting the Forth Bridge... (do they still do that?)
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Post by Humph on Oct 26, 2020 9:14:23 GMT
All of the above, in all posts and responses is in its own way, good, sound advice for which I'm genuinely most grateful. However, irrationally enough, I'm just a bit bored with this (renter) house and kind of want to do something else with the money for a while. It's not driven by immediate need or anything, just a "feeling" that I'm not making the best of it, or maybe it's just a notiion to take on a project again as much for the interest value in these somewhat tedious times.
I think I'm going to at least attempt to sell it. If it gets market value or better, or close, I'll take it. If it doesn't, well, I can always revert to renting it.
Just want to try something different for a while. For no reasons I can really justify.
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EspadaIII
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Post by EspadaIII on Oct 26, 2020 9:57:47 GMT
Man maths....
You'll regret it!
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Post by Humph on Oct 26, 2020 10:15:40 GMT
Yeah but, no but, well, yeah, maybe...but...
😉
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Avant
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Post by Avant on Oct 26, 2020 16:18:55 GMT
The professional in all of us says 'beware of man-maths'....but then, hey, you've only got one life. If the rental from the apparently unexciting semi isn't an essential prt of your income, Humph, then go for it!
I suppose we've made a sort of man-maths work for us. We started married life in 1974 with a 3-bed semi near Reading, and then when we had lots of children were lucky enough to have the room to extend same. A cheap way of getting 5 bedrooms and 2 bathrooms, and nothing for estate agents or solicitors.
When we decided to move 6 years ago, it occurred to us that we could split the house into 2 units, one with 3 bedrooms and one with 2. Surprisingly easy, and Wokingham BC were helpful all the way. We sold one house to younger daughter and family, and rent the other to (unmarried) elder daughter who is a nanny/carer and doesn't earn enough to have her own house. Again nothing for estate agents!
I let her have it at a lot less than commercial rent, but it still pays for the PCP payments on the cars. That's why the cars are new. Man-maths maybe, but we like it that way.
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Post by Alanović on Oct 26, 2020 16:40:21 GMT
Interesting topic. My home is a large part of my retirement plan - by which I mean that if we realise some capital and income from it before our pensions kick in, we can afford to retire earlier than we would otherwise. Which I very much want to do. Obviously this can only be achieved by not living in it. My decision on what to do with it will be based on the most money I think I can make from it - by either selling, or developing and selling.
So 3 options present. It is currently an unimproved (from the outside) 70s detached house with 4 bedrooms , 2 bathrooms and 3 receptions. 1 - Sell it as is, just take the equity and run. 2 - Extend and refurbish to a high modern standard inside and out to include 5 beds, 3 baths and 2 work from home rooms (this latter will be a really big hook to buyers in the near future I think). 3 - Demolish and replace with 2 high end 4-bed detached homes. I *think* the plot is big enough to house 2 detached 4 bedroom houses, and I *think* planning should be achievable for that. A similar house locally has recently been demolished and 2 super-high spec homes built, although I think their plot is a bit bigger. The sale price these 2 houses are being offered at is quite a factor higher than my house is currently worth as a sell-as-it-is proposition.
Nearer the time, I will get some professional advice on the feasibility and potential cost of options 2 and 3, and will go with whichever lands me the biggest profit over and above current value - if any.
Plan would then be to buy a small house in the UK, 2 bed modern starter home type thing, a rural residence in France where I will spend the majority of time, and put the rest of the capital in to rental properties, and live off the income. No mortgages to pay.
Well, that's the theory. The world does seem to be throwing up regular black swans in people's paths, maybe something will sink us. But dreaming of it all keeps me sane whilst rattling away on this wretched keyboard for my pittance.
My instinct tells me never to sell any property you don't need to sell, and only to sell if the capital you realise can make you better money than the property can. Just let it provide passive income. We have such a property abroad (owned outright), which currently we let my mother-in-law live in rent free. I will simply let it out when the time comes that it's available, unless I can see a way to put the value to better work elsewhere to provide passive income. Essentially that property is our savings account, and it provides far better growth in terms of capital appreciation than any bank account ever would have.
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Avant
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Post by Avant on Oct 26, 2020 17:49:15 GMT
In case it helps - if we'd sold the house as a 5-bed semi, it would have fetched about £350,000 (in 2014). The two houses we made out of it were worth about £300,000 each. This is Woodley - lower values I presume than Caversham Heights.
Your last sentence says it all, Al: property prices may dip for a time but should soon rise again, whereas bank interest rates will take longer.
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Post by Humph on Oct 26, 2020 18:22:26 GMT
Today's main job was relaying some patio slabs. Easy enough really. Then, I needed to replace the toggle switch for the electric shower, no problem there either. But then, I attempted to change the central heating timer switch thingummyboberrthingummy.
Gave up, 14 wires, put the old one back. Brain hurts.
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Rob
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Post by Rob on Oct 26, 2020 19:43:48 GMT
Part of our plan is that this house (or another in the UK) is perhaps rented out and we buy a place in Greece to live. The rental income will be handy and it's a place to return to if needs be. Also a place to keep some money invested.
But then do you buy a cheaper property here like Al is thinking... still a lot to think about and unlike Al I can't get a EU passport.
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Post by Alanović on Oct 27, 2020 9:28:07 GMT
In case it helps - if we'd sold the house as a 5-bed semi, it would have fetched about £350,000 (in 2014). The two houses we made out of it were worth about £300,000 each. This is Woodley - lower values I presume than Caversham Heights. Your last sentence says it all, Al: property prices may dip for a time but should soon rise again, whereas bank interest rates will take longer. Interesting numbers. Sadly my 'demolish and build 2 houses' plan would be a lot more costly than converting an existing building in to 2. Will need some proper, realistic number crunching come the time. 6-10 years to think about it. This is the local plot in a similar location to mine (if anything a less prestigious address) where an existing house was demolished and replaced with 2. The previous dwelling was a similar size and value to mine - which is substantially lower than the asking price for one of these houses. Tesla S in the driveway on the mock up shows what kind of buyer they're aiming at... www.rightmove.co.uk/new-homes-for-sale/property-94958330.htmlNot sure I can achieve identical results as I've a slightly smaller plot (although in a more desireable location), but it's got me thinking.
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EspadaIII
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Post by EspadaIII on Oct 27, 2020 12:54:54 GMT
They are big houses at 2,580sq ft each. Rather wasted ground floor though. On a smaller plot and with a better internal design you could get a very nice and spacious four bedroom house.
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