For landlords who have spent years building up equity, looking at how much a property has increased over the life of a mortgage can be rather satisfying.
But long term gains isn’t the only prize worth noting.
So is what you could do with that equity now.
Imagine you bought a house 18 years ago for around £75,000 and today it’s worth £150,000. You’ve collected rent throughout that time, the property has doubled in value and perhaps you’ve now got just £20,000 left on the mortgage.
You’ve already done pretty well out of it.
You like your tenants, they’ve never been any trouble so you’ve kept the rent low and it’s currently £650 a month. After tax, repairs, insurance and other expenses, perhaps the property is putting £4,000 – £5,000 a year into your pocket.
Sell it now and you could reach more than 20 years of rent before the end of the year. Not only that, put it in a savings account paying 4 – 5% interest and you’ll earn £4,400 – £5,500 interest a year… and all without the hassle and stresses of being a landlord.
Plus, if the interest rates do go up as forecast by some national newspapers on Thursday 03rd Sept 2026, rental income is likely to go down while savings could go up.
You’ve probably already thought about what you could do with that money but after 18 years, the property may be looking a little tired. You’ve maintained it, but it could benefit from being redecorated. Perhaps the kitchen and bathroom are functional but dated? It will need work to bring it up to the standard today’s owner-occupier expects and it all feels like an awful lot of work.
Then there’s your tenant. Perhaps they’ve been with you for years too. You don’t particularly want to ask them to leave simply so you can squeeze every last pound out of the property. You’ve tried waiting for them to leave but there’s no sign of them leaving.
You’d love to sell, you’d have easy access to then money when you want it and in between you could put it to work for you elsewhere.
Plus, you dislike the direction the PRS is heading but how can you sell rental property avoiding the complications, costs and confrontations that make selling rental property feel like a huge challenge sometimes?
So why not use some of the equity you’ve already built to make selling easier?
Accepting a little less can open the property up to more buyers, give us room to work with your tenant and remove much of the cost, effort and disruption involved in chasing the highest possible price.
In return, you get to cash in on a very successful investment when you want it and without having to turn the property, or your tenant’s life, upside down first.
What Does That Look Like In Real Life?
One landlord we worked with had a flat worth around £125,000 with vacant possession.
They could have chased that figure – but that would have meant dealing with the tenant first, potentially spending money getting the property ready for an owner-occupier and then waiting for the right buyer.
Instead, we sold it with the tenant in place for £115,000 in just two weeks.
The real choice wasn’t simply £125,000 versus £115,000.
It was whether another £10,000 was worth the time, work, lost rent and uncertainty involved in trying to achieve it.
For a landlord who has already enjoyed years of rental income and substantial capital growth, £115,000 in the bank can suddenly look far more attractive than £125,000 on paper.
What Matters Most To You Now?
Look at what you’re actually making from the rent. Look at how much equity you could release. Then ask yourself how many more years you’d have to remain a landlord to earn the difference you’re holding out for.
If you’d like to know what we think your property could achieve based on historical data rather than optimistic guesses, get in touch today.
We could have you sold and complete by Xmas.