16:38 PM, 22nd February 2017, About 5 years ago 16
My wife and I bought our one bed flat in a town in the NW of England in 2007 – the plan was simple keep it for 10 -15 years then sell using the increase in valuation as a means to diversifying our pension provision.
We never bought with a view to growth in units we were happy as amateur investors to see a modest gain at the end after tax. My wife is not a taxpayer so we could mitigate tax cost along the way. Then came 2008, the financial crash and even now my best estimate is that the flat is worth only 60% of cost. We have generally ploughed the profit from rent back into our living costs given that cash deposits are earning next to nothing.
Other than diverting funds from my pension income to assist I have no immediate means to clear the shortfall. Even if we hang on the chances are that in 10 years when the mortgage is due to be redeemed we will be well short. I am now about to finish work because of ill health and a year short of state pension and my wife is 3 years short of state pension. I have decent pension provision, but I hate the idea of this not being resolved.
On the positive side we have kept the current tenant for over 4 years although we have reduced rent to keep her and have no immediate plans to increase rent.
Does anyone have any sensible ideas for taking this forward?