When moving out of your home (that you own) and in with a partner, you have two main choices. You can either let your property to a tenant or sell it on the open market. Read our advice on letting vs selling when moving in with a partner.
Letting vs Selling: Which is Best?
Each option has its pros and cons, which we’ll get into detail about below.
Pros of letting:
- Potentially lucrative income stream – Depending on demand in your area, renting can provide extra cash and offer a reliable source of income
- Retain the asset – Properties generally increase in value over time, so by holding onto it, the asset can continue to appreciate
- Flexibility if the relationship ends – With a periodic or tenancy at will, you’ll only have to wait until the notice period ends if you want to move back
Cons of letting:
- Increased responsibilities – As a landlord, you’ll need to manage tenants, the property, and repairs (although working with a lettings agent can alleviate some of the responsibilities)
- Taxation – By switching to a buy-to-let property, you may not be eligible for capital gains tax relief when you sell, and you may have to pay tax on the income earned
- Stamp duty – If you buy a new property in the future with your partner, you’ll need to pay a higher stamp duty rate because you own a second property
Pros of selling:
- Ease of moving in the future – If you plan to eventually buy a new property with your partner, selling now can simplify the process later down the line
- Release equity – By selling, you can release the equity you have in your property, leaving you with more cash in your pocket
Cons of selling:
- Potential lost income – You may be missing out on revenue, financial stability, and an appreciating asset if you choose to sell vs let
- Loss of property if the relationship breaks down – Should the relationship end in the future, you won’t have the property to return to
How to Decide Whether to Let or Sell
Here’s our advice on how to decide whether letting vs selling is right for you.
Get a property valuation
Start by establishing how much your property is worth on the sale and rental market. An expert local estate agent can offer invaluable advice on how in-demand your property is if you list on either market.
Or get an instant valuation if you’re not ready for an estate agent.
Crunch the numbers
Once you know your resale value, crunch the numbers to uncover where you might be better off. Consider how much you might need to invest, and what you might gain from letting vs selling.
Schedule time to speak to a mortgage advisor to check your affordability and explore your options.
Discuss options with your partner
If you haven’t already, you might want to discuss with your partner what the plan is after moving in together.
If the plan is to eventually buy a new home together, owning a second property will affect the amount of stamp duty you pay. It may also affect your mortgage affordability in the future.
Getting on the same page about the next steps can help you decide whether you should let or sell right now.
Ready to Explore Options?
We can help. Get an instant online valuation today or book multiple valuations at the touch of a button with our expert local letting agents and estate agents.