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Should I sell my property or rent it out?

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If you are moving away from London for a fixed period, or maybe forever, you have some important decisions to make. One of these will undoubtedly be whether to sell your house or to rent it out. There are no easy answers, and so much to consider, including the uncertain future of the property market in the capital. Here are a few of the things you need to think about…

Should I sell my property or rent it out?


Property Prices

Property prices in London have increased over several years but there’s no denying that things have slowed down in recent months. Experts can’t agree whether this is an inevitable adjustment in the market, or the result of uncertainty caused by Brexit. You can’t be sure that your property will increase in value in the near future and could even be facing a fall in value, raising the spectre of negative equity.

But if prices are about to fall, it doesn’t necessarily mean that you should rush to sell your investment. Its value is almost certain to increase over the long-term, regardless of what happens in the next couple of years. If your property’s value has already increased, and you feel you should cash in before prices fall, remember that selling your home will incur significant expenses. Estate agent’s fees, legal costs and land registry charges will need to be deducted from any gains you have made.

If you decide to sell your home, the process will swallow up a lot of your time. You’ll need to decide whether to market it via a sole agency agreement or through multiple estate agents. You’ll need to obtain an energy performance certificate and be dealing with potential buyers too. Remember that buyers don’t always proceed with the purchase as promised and any number of things can go wrong, even after an offer has been accepted.

Buying and selling property is expensive and complicated. You may find that it’s actually easier and more profitable to rent out your property.


The buy-to-let market

There is a significant demand for rental properties in London. However, it is important to establish whether or not your property is likely to yield the rental income that warrants holding on to it.

Rental yields vary dramatically and are influenced by a number of factors. You must be sure that the rental payments will cover your ongoing costs.

Bear in mind changes to tax relief on mortgage interest, which is less generous than it was previously. It is also possible that any rental income you receive will place you in a higher tax bracket and you should consider the implications of this before proceeding.


Your responsibilities as a landlord

Even if the rental income that your property could yield looks like an attractive proposition, owning a rental property will place demands on your time. You have numerous responsibilities as a landlord and adhering to these could involve significant expense.

In addition, any periods when your property isn’t occupied, problem tenants and tenants who fail to pay could seriously reduce your profits or see you making a loss. You will have to keep in touch with your tenants and the property will require regular maintenance.

If the prospect of managing a rental property is too daunting, or you feel that you wouldn’t have time to cope with everything involved, there is another option.


The Assetgrove Rent Guarantee Scheme

Assetgrove’s Rent Guarantee Scheme alleviates the fears a prospective landlord might have about renting out their property. The scheme enables you to let your property without the associated stress, and you will receive fixed monthly payments, even if your property is unoccupied.

Assetgrove offers up to five years guaranteed rent via a legally binding contract. We will manage every single aspect of the tenancy during this period – with no monthly agent fees, commissions or hidden surprises to pay.

Particularly beneficial if you will be living some distance away, the scheme gives you complete peace of mind. We will find and vet potential tenants, handle the tenancy agreement and manage the property on your behalf.


Long-term security

The income you receive from your rental property could secure your financial future. It might enable you to retire earlier than you previously thought or could be used to boost your pension pot.

You have the option of saving the money to enable you to expand your rental portfolio or you could use it to establish a new business. Renting your former home gives you choices you might not otherwise have had, and you will be able to retain a valuable asset that you can sell in the future, when it suits you best.

Deciding whether to sell or rent is never easy. But if the pitfalls of being a landlord are worrying you, Assetgrove can remove these from the equation making the decision much more straightforward.

Contact us to find out more today.

Neil Jennings

Neil is the Operations Director at Assetgrove Lettings, London's Leading Rent Guarantee Company, providing Landlords with no voids, property maintenance, fee-free property management and stress-free service.

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