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I think I am right in saying that the Majority of Landlords in the PRS in general are Post war generation
A great number of us have invested since the 1990s and I think most would have had a good run
BTL has worked for them and they are sitting on low leverage and most likely a good yield
Its given some of us freedom and a Life on our own terms
I strongly believe the best days of BTL are now coming to a close
For me personally I have no wish to sell any assets But I will not be buying new Property to add to my business
I am happy to see the younger generation take up the challenge and make a go of BTL
A lot of you will be awear that for some time I have been negative on BTL and with all the changes I don't think I am alone on this topic
But Tomorrow is another day and has to be planned for
As I age what do I want ? and if your older person maybe you are starting to ask the same question
As most of you will Know I have invested heavily in the Past 3 years in pension I can see my Pension Growing each month with its ups and downs at present but Its working and its nice to have the Tax Man helping me on the way
I want a private income from my Pension and I start opening the taps in around 3 years time
My own starting point is this:
1 I could sell up 100% of my BTL and pay a lot of Tax
2 I could sit and do nothing and carry on managing the property I have Day To Day
3 I could Hand Over all management to a Professional Managing agent such as Northwood so in point of fact I become hands off in my Investment of the day to day running
Osborne has certainly made me think. I know Four Years ago I would have supported the views of JC and others and Purchased more and more property
But today the PRS is becoming a different world and I have to account for the changes and act on them
As they say when one door closes another opens ...
I think this s a very true statement
We all have to change and we all have choices
I think there is an opportunity for Agents Like Northwood come forward and offer services to the older and wealthy landlords
The opportunities to get Old in BTL I think are good opportunities
Pat yourself on the back and look back at what you have created. I know I will look back on my younger years in the Business and say It was the best thing I ever did
And that's the point of this blog we can all be so busy in life we fail to admire what we have built
For the first time in a long time I can now see a rosy future
I have the challenges to face with rent arrears, repairs ect ect But I am more than used to that aspect of being a Landlord
It doesn't matter what the Govt throw in front of me now I achieved what I wanted and they can't take that away from me
I really think the PRS can go from strength to strength so enjoy the ride
The Govt this week woke up about UC paying direct to Landlords
Lets hope they wake up to the issues of S24
Personally I am not holding my breath on that topic But I have my fingers crossed for S24 retrospective policy to be removed
I think most of us would find that fair and I hope RLA & NLA push for that change
So come on you old Buggers, what are your plans how will you cope with the Autumn years and your Landlord Life?
I would like to see Agents working on this issue of the Older successful Landlord
None of us go on for ever but we can hope to live life to the best and enjoy the fruits of your labour.
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
Hi DL,I certainly think that, as you get older, a person's ability to deal with stress and hassle becomes less.I know from my own experience that tolerance of landlord problems is becoming harder to deal with as I age.I think you are right to suggest that landlords consider how they will manage their investments in their old age.There certainly comes a time in life when you want to kick back a lot. I agree that Northwood Guaranteed Rent is one possible solution.If you have been in the game for a long time, it is likely you have accrued a lot of equity and are enjoying greater cashflow, meaning you can consider such solutions.There is always so much choice in how, as a landlord, you run your business. That is one of the greatest things about property investment, that it is highly customisable to your personal situation.
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
DL, we are very different landlords and there should be very little we have in common. I've read most of your posts but don't perceive them as negative or positive, merely as possible issues and solutions. My way of thinking has been heavily influenced by yours.
I am in the process of my own little landlord shuffle. I will be creating a 'property thing' that should provide a liveable income for me for the remainder of my life and some income for my children. I will be comfortable, but not wealthy, and the tax man seems to allow me this free of charge - almost. I'll still pay tax on a pint!
One of the advantages of getting older is wisdom and emotional resilience. I'm in no rush but when I see what I want I'm confident enough to go for it.
A good teacher must know the rules; a good pupil, the exceptions.
Martin H. Fischer
It can be done and I am sure you can do it
if you want something bad enough it will happen
there is a time for everything and now it’s your time to grow wealth
Hi dislexic _landlord,
Interesting post, and one which Im currently undergoing at the moment. Like you I live in the North East and agree with your views regarding the state of the housing market here. On Teesside there has been very little capital growth since the crash of 2008.
I read one post(not yours) where they had a void of 4 months in Liverpool. That is not uncommon here Ive had a void of 6 months on my houses since the university pulled out of town.
I would have thought your post about what to do in later years would have had more posts as it will affect all of us. Ive done okay with my portfolio but have decided to cash a few in now, unfortnately on a few of them Im in negative equity so Im going to have to finance the short fall from savings.
I shall keep about 6 houses and gradually reduce the portfolio over the next 2 yrs. Obviously tax is a issue and I will have to pay some tax but am trying to minimise it as much as possible.
Sooner or later you have to make that decision.No point in being the richest landlord in the cemetery.
The last 10 yrs have been dismal in the north compared to the first 10 yrs but theres no guarantee in life. Main thing is we have enough time and health to enjoy the fruits of our labours. Thats what it all about.
Yes there comes a time when you take the foot off the gas and engage cruise control and enjoy the ride
this is now my intention
the striuggle to build more and more is over
I see myself as a manager now Drawning an income full stop
I am not going to bust a gutt for a nett pay of 60% tax bill
you are so right about capital growth but I think our time will come I can see rent yields riseing and I think we will have some capital growth
I belive northern landlords are in a much better position to ride out the storm that we face
are yields are high and that is what pays the bills
SE landlords or sitting on high growth but yields are low
I know where I would rather do bussinss and that’s the north
I'd already decided a long time ago that property could be an income and a pension, so I'm not planning on going anywhere even in my Autumn years.
One more will mean the chance to relax a bit more, and I do feel that 3 will be the magic number. With dozens or more I can see how it could become a headache later on, but, I feel it would probably already be a headache. Less is more is my adage when it comes to property! I've never seen the appeal of owning loads of properties especially from an ongoing management aspect, and now with increased stamp duty etc., probably never will even if I wanted to.I can manage these 3 until I can no longer get to them (30 mins away) and by that stage I will have put trusted other(s) in charge.
Where I've bought there will always be a good demand, plus they're houses so have potential to improve if I see fit.
Get them unencumbered asap whilst keeping income up and then pass them on (gifted) but with me retaining the income is the plan (in my head).
It is hard thinking about the later years. I fully plan to be doing the same things 50 years from now! One thing that gives me hope on this is that my Great Uncle called me the other day for help with his car insurance because his premiums are going up a bit and he wants to buy something more economical. He is 50 years older than me and in his mid nineties.
I see what the future could be like. My father is 74 and still dealing with his buy to let portfolio personally. He needs to go to a flat this week and change a radiator that is massive and too big really to lift. He then needs to go to another flat and change the bath taps which will involve squeezing between the bath and the WC in a very confined space and he is worried about doing this with arthritis in his hands. Then he has another house which is empty at the moment as he is refurbishing it between tenants, and has been for 8 months now. At 74, something seems wrong about this, but as a family we seem to have massive difficulty ever finding trusted tradespeople which would be the obvious solution. He now wants to employ me to do everything going forward but I am also flat out with my portfolio and have been doing 7 day weeks since October last year. I do feel some responsiblilty as I made my parents build a portfolio in the mid to late 1990s when I did.
My youngest brother has an amazing business away from property and is flash with his cash. He bought a large detached house and thought he would show us "old hands" how it is done. As a result he had a plumber who caused a flood which took down a ceiling. He had a gas engineer that promised him a 10 year guarantee on his boiler but then "forgot" to register it and then swore at him and walked out rather than repairing it when it stopped working at only six months old. He had a plasterer that clearly needs to go to specsavers. He had an electrician that fitted lamp sockets in some bedrooms but forgot to connect a couple of them to anything and then also left live wires that zapped my brother across the room. All these tradespeople were highly rated on the usual websites. He now doesn't feel that £50k was that well spent. My brother has now fixed everything himself and joined the family tradition of living "diy" and not trusting anyone else for the rest of his house.
I still suffer from eternal optimism and have decided to massively improve my portfolio over the next few years and hopefully increase it too. The thing that upsets me is the way the government have caused me to be stuck with what I already have. I would love to sell some of my low yielding but immaculate larger houses and buy higher yielding properties with potential but it seems that with CGT and stamp duty, a few flips could easily take my £650k type family homes down to £250k flats without me seeing any money. Why there is no rollover type relief I just don't know. If I swap a semi in West London for one in Surrey of the same value it staggers me that the government will want to take well over £100k from me for the pleasure,
With regards to the later years, all I can say is that I wish I had a crystal ball.
Interesting that landlords have chosen BTL to provide a pension but few appear to be planning to sell up and take their profits to enjoy retirement, choosing to continue to manage and maintain them for as long as possible.
Vanessa is right the ability to deal with stress and hassle as you get older does reduce. If you keep properties into old age it’s on a par with retiring from your main occupation and then taking a part time job.
Perhaps it’s the delayed gratification continuing, if it is then being a landlord is replacing an employed position with a self employed one, probably at a much higher hourly rate, but it is still employment and without a set retirement date.
We are all different, some will decide to sell and live off the capital whilst others will wish to maintain the rental income and accept the hassle that goes with it.
I plan to keep most of my properties and keep taking an income/pension from them. It is not like they are that much hassle, since my LAs manage them.
If I sold up I would have to find some other way to get an income/pension. Actually I will be doing that anyway since I plan to start taking several pensions in a few months.
The is one exception. I am selling a former home, my only southern property (Reading).. It provides very little income, and the capital growth is more significant. Also due to PPR there should be no CGT to pay. I plan to use the proceeds to reduce my mortgages providing me with protection from S24 and interest rate rises.
I suppose LLs whose rental returns are low and capital gains are higher might be better off selling, but I have been making 8% net returns (before tax),
This is a topic very relevant to me. I'm 52 soon and I'm still working full time but hoping to stop working at 55. I have 12 properties and they generate a similar income to my work salary but I've still got plenty of mortgage debt. I'm thinking of various strategies so that I can stop working at 55 without worrying about interest rates rising dramatically. I'm trying to pay down my mortgages as best I can until 55 and will probably sell a few properties.
I'm also based in the North and had no capital growth since 2008. I'm not too worried about the property management side as I get older but it certainly can be a hassle.
I'm hoping to keep and live off about 8 of my properties through retirement then pass them on to my kids.
Like others, I certainly won't be wealthy by any stretch but I "should" have enough to live on reasonably comfortably.