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  1. I'm 64 years old and my wife is 61, both in reasonable health, however, we are hoping to retire in 2018. For the last 30 years, my wife and I have run a Guest House. The building is quite large over four floors including a converted basement area with the land taken away from the gable end creating a large patio area for the basement. As you can imagine, this is a life changer for us; once we close the doors we stop our income. Scary. That's why I've joined this forum. The building is worth around £850,000.00 with no mortgage attached. The location is a south Manchester suburb with very good transport links into the city 5.9 miles away; including a metro stop just a 9-minute walk away (no not 10, 9 ) which take 12 minutes into the city. We have savings of £150,000, a private pension of £3700 per year with my state pension due in Jan 2018 and my wife’s due in Feb 2022 and a small pension due in 2023 of £4700 per year. We have two options: To sell, buying a place for our selves with the proceeds of the sale, say £400.000 and invest the rest hoping for a minimum yearly income of 4% on £400,000. (£1,300.00 per month including fees) To redevelop the building; creating just 4 luxury apartments (very large, one per floor). With a minimum rental income of £1000 per unit. The question is what would be the most prudent way of setting up option 2 . Option 1 Is pretty straightforward, however, we would end up with the main part of our retirement income being susceptible to fund managers decisions and stock market fluctuation (little control). Option 2 As a couple of potions its self : a) We move out into my wife’s brother house with them, for a good 6 months or we rent at £700 per month. We use our saving to redevelop hoping £150,000 will be enough, to leave us with no loans or mortgage to repay. Once the work is completed we take on one of the apartments. Reducing our income from £4000pm to £3000pm. Asset wise we will have the proceeds from the sale of a property to pass on to our sons. We have tree boys all in there 30's. The first two we help to buy their houses. The oldest bought for £62,000 the second bought at £162,000 and the third is having a hard time with the average house around Manchester at £250,000. We could sell one apartment to him for £150,000 through his own mortgage. After inviting 7 estate agents in round 18 months ago the average sales price of each apartment was £250.000. This will generate another £150,000 in the pot which would secure the development costs and also could be used as a deposit on a house for our selves with repayments met by are overall income. The thought being our youngest son can sell or rent out his apparent to help fund a house for himself. Asset wise we would have three apartments at a minimum sales price of £750,000 and the equity on the house we would buy. The three apartments would act as security on any loan we require for a house. This is just my thoughts. I would love it if someone told me it's a load of rubbish and came up with a fantastic new way of looking at it. We rented out a number of properties in the seventy's all to students, so a little experience, but need to get up to speed with todays letting market. The Planning decision is on the 5th October, in which we envisage no problems. If we decide against the development the building will be sold with planning permission. Other factors, My wife is scared stiff.
  2. Hi, Hypothetical situation for you. You are 64 years old and married. You just sold your house for £650k and downsized. You have £250k to generate an income through property for your retirement together. Your BTL portfolio will be your only source of income (apart from state pension which is only about 3k a year and doesn't kick in until you are 65). How would you go about this? Would you look to buy one property with cash and live off the, let's say, £18k net? Where would you buy? Or would you look to get a BTL mortgage on 2 or 3 different properties? Or would you approach the problem completely differently? Would love to hear your thoughts.
  3. Hi If any one has forgotten why property is best retirement fund, read today's front page of City A.M. - http://www.cityam.com/article/1390353690/brits-told-save-six-times-more-your-pension-or-face-poverty Makes for some sober reading! Cheers Jonathan
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