Should I Sell My Property and Rent?
Having a mortgage is not for everyone and once you hit retirement you can find that the burden of having a mortgage or even owning your own property is too much.
More and more people are starting to turn their back on home ownership in retirement and choosing to rent instead. Renting might be a great way to save money but property is still the number one investment, so if you can it is worth trying to keep hold of your property.
Does It Make Financial Sense To Rent?
Your financial situation should play a large part in your decision to rent or to keep hold of your property. If you are still paying your mortgage it might make more financial sense to keep paying your mortgage if you only have a few years left on your deal.If you switch your mortgage for rent you might ultimately find that you are losing money. If your financial situation is dire and you can no longer afford your mortgage payments you should look at downsizing to a smaller property and using the equity that you have in your property to pay off any debt you might have. It will be a lot harder to get a mortgage if you are retired, so you should not really rely on this as one of your options.
Although renting will initially free up some cash if you sell the property you should calculate how long you can afford to pay rent for and live off the money from the sale of your house. It might make more sense to downsize instead so you are not paying rent.
Would You Leave Your Property For Your Children?
It is not only yourself that you may need to take into consideration if you are selling your home. A lot of parents like to consult their children and get their feedback on whether they should sell their home.Although the decision is ultimately yours it can help to get their opinion and make them aware that you may no longer be leaving your house to them in your will. If you feel you would like to leave the property to them you may want to consider this when making your decision.
Your Current Home
An Englishman’s home is his castle so wherever possible you should try and hold onto it. There are however some scenarios where it can make sense to sell your home. If you are pottering around in a large house and you don’t need all the room there is no harm in downsizing.If your home is in disrepair and you can’t afford to keep up the repairs than a landlord/landlady would be able to take care of this which is one advantage.
In the long-run selling your home might free up a large amount of capital but further down the line you will have to pay monthly rent payments, which could outweigh the lump sum.
In some instances selling your property in retirement can do more harm than good. An Englishman’s home is his castle and it can be nice to feel safe and have the security of your own home in retirement. Equally though, owning your own home can be expensive and sometimes it makes more sense let someone else fix the repairs and faults with your house, it can be a tricky decision to make.
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