The archetypal multi-property “professional” landlord probably only accounts for about half of all landlords. The rest come in all shapes and sizes - The “Accidental” landlord, The “Pension” landlord, The “Parent” landlord and The “Inheritance” landlord. 

In this article, we consider The “Accidental” landlord:

The accidental landlord is a homeowner who would ideally have sold, but has decided to rent their property out instead, for one of two likely reasons. First, the market is not currently strong enough to support a sale within a convenient timescale, or, secondly, the current expected sale price is below the figure that would make the sale financially acceptable.

Nevertheless, the homeowner still needs to move house. It may be because of a change in circumstances, such as children’s school requirements, a job move, marriage or lifestyle needs. So they decide to let out their property as an alternative to selling it. The rent received can then be used either to cover their own rent, or the mortgage payments, on their next purchase. This can be very worthwhile during these times of low interest rates when rental income can exceed mortgage payments. Whilst it’s unlikely that you could secure a 100% mortgage without the proceeds of sale from the previous property, there may be enough equity in that property to cover this.

Although initially intended as an initial short-term fix, we often find that once the homeowner has settled into their next property, the original property becomes a reliable longer-term investment – hence the term “accidental” landlord. We have a number of such people who have then gone on to acquire further properties to add to their initial portfolio of just one property – their own home!

So if you are currently weighing up the pros and cons of selling versus renting, it might be worth asking us to help you consider the merits of both, so you can make an informed, convenient and profitable decision. Please feel free to contact us on 020 8359 3399

Check out the three other forms of landlord ownership: The “Pension” landlord, The “Parent” landlord and The “Inheritance” landlord.

© Copyright 2021 Richard Rawlings except as excluded under licence.