My retirement investment after a lifetime in buy-to-let

If you sold a rental property tomorrow, what would you do with the money?

After selling several of mine, I still wanted a worthwhile income, but I was ready for fewer responsibilities.

I wanted this money working for me without another minefield of licensing, safety certificates, deposit rules and looming landlord registration requirements, and without the potential for substantial fines or rent repayment orders if I got things wrong.

To cut a long story short, I eventually invested in an equity release lender offering a 30-month corporate bond with a fixed annual coupon of 10%, payable quarterly.

Those were the terms of my investment; terms available to others may differ.

Years as a landlord had already taught me to assess risk. Rent arrears, unexpected repairs, taxation, legislation, and ever-changing mortgage rates and lending criteria were all familiar considerations. However, it was my background in commercial finance that helped me investigate a different way of earning income from the property sector.

That’s why I chose to invest into a business providing specialist mortgages to older homeowners. Before investing, I examined its lending, funding arrangements and how it expected to repay my capital. Having experienced the 2008 financial crisis, I needed more than an attractive interest rate to feel comfortable. For me, the appeal was an agreed payment schedule, a business I understood and fewer day-to-day responsibilities. I only committed money I could leave invested for the full term, as there is no readily available market for exiting or trading the bond early. I also knew I was relying on the company to pay the interest and return my money. If it couldn’t, I could lose some or all of what I’d invested, and the Financial Services Compensation Scheme (FSCS) wouldn’t cover that loss or protect me. I was comfortable with that level of risk; I accept others might not be. There is no ‘one-size-fits-all’.

The bottom line for me was this; after spending so many years building my property wealth, I wanted more time to enjoy what I had worked for. Putting some of that capital to work in a business I understood, with an agreed quarterly payment schedule that was outperforming my returns from rental property, suited the next stage of my life.

To find out more, complete the form below to request a private introduction to the intermediary who arranged my investment.

Your answers help them carry out initial eligibility checks and understand your enquiry. You do not need to have decided to invest. It is simply an opportunity to ask questions and obtain current information, without committing yourself.

Commercial disclosure: I have personally invested in the type of loan note described above. Property118 may receive an introductory commission if you subsequently invest. Property118 does not provide regulated investment advice.