8:25 AM, 14th August 2016, About 5 years ago 62
My 30 year love affair with home ownership is well and truly dead. I am divorcing myself of it.
I will NEVER buy another home to live in.
For three decades I have been advising on finance and property and building my own rental portfolio but it has taken me until now to realise that home ownership is overrated.
My recommended strategy to anybody from now on will be to rent the home you live in and own property that you can rent to other people.
Because home ownership is a millstone around your neck!
Because the return on capital from home ownership is pathetic in comparison to property investment!
Because mobility is crucial in modern life!
Because life is just too short!
For many years I believed that I was doing the right thing by owning the home I live in. It is a common British mentality so I didn’t think to challenge it. Now the fog has lifted I see what a fool I have been. I dare not think too deeply about all the opportunities I’ve missed due to my former obsession with home ownership, which I now realise has held me back on so many occasions.
I’ve had this discussion with a lot of people recently so I’ve heard and debated several counter arguments in favour of home ownership already; here’s a few examples:-
As you may be aware, I decided at the beginning of this year to live on the gorgeous Mediterranean Island of Malta. My new beliefs regarding home ownership would be no different if I had decided to remain in the UK though. Nevertheless, moving to Malta has helped me to see things from another perspective so perhaps I should also explain why I made that move.
Malta has numerous advantages over and above 300 days a year of sun filled lifestyle for me. Five percent income tax on UK dividend income and virtually no CGT on property sales or incorporation of a rental property portfolio, even with latent gains, being two big financial ones. That choice (living in Malta) raises other critique though such as:-
I’ve realised that for the last 30 years I had been lying to myself, have you?
By the way, I recently wrote this linked blog to help frustrated first time buyers to deal with their own stinking thinking.
Whilst I don’t want to over sell living in the the jewel of the Mediterranean (it isn’t everybody’s’ cup of tea) here’s a few more of my observations which you might find interesting:-
This blog isn’t supposed to be about living in Malta though. I only added that detail because it’s my blog, hence it’s also personal to me. I will look back on this in years to come.
The real purpose of this blog is to raise debate on whether home ownership makes sense.
It has taken me nearly 30 years to realise that home ownership is overrated. Better late than though never hey?
So what’s your excuse for owning the home you live in?
I look forward to reading your thoughts on the subject.
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