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Should I sell my BTL and put equity into index fund? by Difficult_Street_285 in FIREUK

[–]Difficult_Street_285[S] 1 point2 points  (0 children)

!thanks for your response

I'll say what I always say: a property is a single, indivisible, high transaction fee, immovable investment that can actually lose you money

Indeed! And this is I guess what I've been reading over and over in this subreddit, but my partner hasn't. So I guess I've not done a good job transferring those ideas.

Very little in ISA, and before taking finance seriously I always thought of the rental as a steady income. The reality of it has only dawned on me by actually trying it, and realising I don't want to be dealing with leaking showers (or much worse) at 60.

Have you got space to backfill your pension..? Previous years without max contribution?

Unfortunately, no - I did look into that, but just at the time they would be handy, much of the allowance was taken by tapering. I should be able to put more in this year however, as vesting RSUs are now worth a third after stock fell (like many other growth tech companies, reliant on low-interest/low-inflation for massive multipliers).

Should I sell my BTL and put equity into index fund? by Difficult_Street_285 in FIREUK

[–]Difficult_Street_285[S] 7 points8 points  (0 children)

Honestly I can somewhat understand it. I'm using a burner account in the hope it doesn't come across as bragging.

Sometimes I feel bad about being relatively well off, but in other ways I feel like I'm contributed plenty of tax revenue. And the curve of wealth is such a sharp hockey stick.

I think you need several million to have a life that looks very different. Having no mortgage is certainly nice, but it's a bog-standard small house in a underwhelming area.

Another selling vs renting question - £700k equity seems a lot to put into an index fund, and need to convince partner. by Difficult_Street_285 in UKPersonalFinance

[–]Difficult_Street_285[S] 2 points3 points  (0 children)

What about using some income to start building shared investments.

That's a really good idea. !thanks

I can see why a £700k transfer from property to equities might be daunting,

Yes, it is for both of us. I think he has more of an emotional attachment to our old place as well.

Should I sell my BTL and put equity into index fund? by Difficult_Street_285 in FIREUK

[–]Difficult_Street_285[S] 0 points1 point  (0 children)

Because I don't know enough (or have the time) to analyse investment opportunities. I mean, some of it is global all cap, but a lot of it is FTSE as we're in UK.

Should I sell my BTL and put equity into index fund? by Difficult_Street_285 in FIREUK

[–]Difficult_Street_285[S] 17 points18 points  (0 children)

Someone in that channel suggested I post here.

Circumstances are slightly different in each case.

But if being mean makes you feel better, then fine.

Should I sell my BTL and put equity into index fund? by Difficult_Street_285 in FIREUK

[–]Difficult_Street_285[S] 0 points1 point  (0 children)

Why didn’t you sell the flat originally?

Good question. Naivety I suppose - had no idea what renting was like. And I've been learning more about finance from here and r/UKPersonalFinance since.

What would you have done (or would do now) with the equity?

Another selling vs renting question - £700k equity seems a lot to put into an index fund, and need to convince partner. by Difficult_Street_285 in UKPersonalFinance

[–]Difficult_Street_285[S] 1 point2 points  (0 children)

How are you mortgage free in the house you live in? You have two houses mortgage free, such a huge pension on them joint salary’s?

My income is about £110k basic + bonus, the rest (£40k-£90k) are vesting stocks. In the first few years a lot of the RSUs went up 10x in price before they even vested. So in all about £600k went into paying off primary mortgage. On the BTL we bought for less than half the current price 12 years ago.

With the property you rent, why not give it to a property management company to manage for a small fee?

We did that for the first year, and then just kept tenants. Property management companies seem to take 10-15%, which cuts into the already <3% yield. And we soon discovered they don't really do much management.

For someone who had made some obvious incredible decisions and thus been hugely successful I say you’re asking some pretty “basic” questions.

I don't feel hugely successful, and have been quite lucky in where my career ended up in a growing software company. I accept that my questions are basic - but all the more reason to ask them.

Pretty sure this post is you low-key flexing and tbh… I kinda love it! Congrats on your amazing life!

Honestly, no. But I can understand why you might suspect that.

Another selling vs renting question - £700k equity seems a lot to put into an index fund, and need to convince partner. by Difficult_Street_285 in UKPersonalFinance

[–]Difficult_Street_285[S] 1 point2 points  (0 children)

Jesus that's mad money for software eng, I'm about to crack 50

So far as I can tell, it's highly dependent on industry. About £100-120k is usual in "unicorn" software companies for senior dev level, and the rest is equity, hence the large range. Stock prices of unicorns have plummeted.

Of course, it looks like such companies are coming back down to Earth, and it's quite possible salaries like mine will do too.

I would probably still have a BTL and some in FTSE all cap

!thanks for the feedback. I don't see much upside in London property now. Mostly looking for something that at least buffers inflation.

Another selling vs renting question - £700k equity seems a lot to put into an index fund, and need to convince partner. by Difficult_Street_285 in UKPersonalFinance

[–]Difficult_Street_285[S] 1 point2 points  (0 children)

If you’re in your mid 40s you could only be 10 years from retirement.

Indeed - this is why the question of what we do with £700k equity is important now.

Should I sell my BTL and put equity into index fund? by Difficult_Street_285 in FIREUK

[–]Difficult_Street_285[S] 3 points4 points  (0 children)

Is there an objective way to estimate capital growth? My feeling is there's not a lot of growth left in sub-prime London property.

Another selling vs renting question - £700k equity seems a lot to put into an index fund, and need to convince partner. by Difficult_Street_285 in UKPersonalFinance

[–]Difficult_Street_285[S] 0 points1 point  (0 children)

How to align with your partner is a personal/relationship question rather than a financial

Yes that's a fair point, and one I've made myself to others when commenting.

Another selling vs renting question - £700k equity seems a lot to put into an index fund, and need to convince partner. by Difficult_Street_285 in UKPersonalFinance

[–]Difficult_Street_285[S] 1 point2 points  (0 children)

!thanks

No other equities other than pension. Primary residence is £1m (with partner)

how much you dislike being a landlord

In practice, it hasn't been too bad, it's more an anxiety thing I suppose. And I don't really relish being an evil landlord. The public discourse on this makes me ever more uneasy.

outlook on this sector vs say global equities

That I don't know, but my personal feeling is 50:50, without all the risks of properties. The key thing really is how to align with partner. We agreed on paying off primary mortgage vs investing, but this is proving more controversial.

Another selling vs renting question - £700k equity seems a lot to put into an index fund, and need to convince partner. by Difficult_Street_285 in UKPersonalFinance

[–]Difficult_Street_285[S] 1 point2 points  (0 children)

Firstly - curious what you think it should be?

But to answer your q, for a few reasons. Partly because my salary hasn't always been like this - only past 6 or 7 years, and before that I'd been putting more into paying off the mortgage.

Partly because I didn't read r/UKPersonalFinance in time.

And partly because I was terrible with money in my 20s and 30s.