Retiree with Large savings and low income - possible to rent?

Tenant Discussion
1

Once Renters Rights Bill goes into effect in May 2026, will a tenant with large savings but no employment income be able to rent ?

Here is my situation. Can afford to buy a place of my own but prefer to rent. Single, no family, may go away to another country, don’t want the commitment of property ownership.

Im a lazy procrastinator. Was on a good wage but preferred frugal living, so rented a cheap flat for couple decades, never missed rent payment. Thought of buying but kept putting it off. Saved and invested in ISA, SIPP etc. Pressure got too much at work and decided to quit couple years ago

Have healthy multiple of living expenses in stock/bond index funds and cash - being single and frugal helps. My yearly interest and dividend income probably wont exceed £10,000. Most of the investments are optimised / tax sheltered in Accumulation units, so, hard to “show income”. In Taxable, I may go for low coupon gilts since individual gilts are CGT free. Not planning to take out my SIPP just yet.

My landlord doesn’t know I am not working. He may not care, I don’t know. But he wants to remodel my flat and sell it. He wants me to leave by Dec 2026, hard for him to sell with tenant. So I may need to look for a new place to rent later next year, hence my post. Or, should I sign a lease before May and have it in writing allowing me to pay rent in advance (illegal from May ?) ?

Spoke to several high street letting agents, they say it wont be an issue if I can show cash savings 30 x monthly rent which I can easily do. Oh, and landlord is happy to give good references, I am a boringly reliable tenant. No vices, parties, no default. No pets. yeah, boring. I am almost a government bond :slight_smile:

Been posting on various other forums but just discovered this one.

Thanks. Posted on Tenants forum, perhaps I need to cross post to Landlords forum.

2

Any rent in advance pre may would need to be repaid so thats not an option.

I would not agree that 30 months rent in cash would be sufficient, that would run out very quickly…

Personally i would look at your assets and assign an assumed income based on 6% of their value to reflect returns and some drawdown of assets. So assuming you had £300k in cash, investments and pensions this would provide notional income of £18k, add on the state pension and any other incomes, and then determine affordability from there. I dont use set multiples as depends on circumstances but typically allowable annual rent would be in range of 30-40% net income.

3

I would agree with Richard that 30 months rent in cash deposits would not on its own be enough for me. £10k a year is not enough to rent a property and live, so I would want to see your plan of how you propose to increase this and when.

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I am of the belief that rent in advance is still acceptable, but the landlord cannot request it nor make it any part of the condition of the tenancy. It must be solely down to tenant initiating it.

5

@Mark10 OR and nrla disagree

Best

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From OR blog “Rent in Advance Rules Under the Renters’ Rights Act Explained”

Can tenants choose to pay up front anyway?

No, the rules are very strict. Section 5 of the Tenant Fees Act 2019 will be amended to include anti-avoidance measures, which are similar to those used to ban rental bidding. Landlords and letting agents must not:

accept a prohibited pre-tenancy rent payment from a tenant, guarantor, or any other “relevant person”
invite or encourage a relevant person to make such a payment
use a third party to get around the rules, including accepting rent from a third party or encouraging a third party to pay

Even if a tenant offers to pay several months’ rent upfront, you are not permitted to accept it. Under the Tenant Fees Act, a “relevant person” includes the tenant and anyone acting on their behalf, such as a guarantor.

Failure to follow these rules can result in a financial penalty if a local authority determines beyond reasonable doubt that the landlord has breached them.

Nrla page ‘Renters Rights act managing payments’ says same

If a landlord accepts rent at this stage, even a voluntary payment, it breaches the Tenant Fees Act, meaning the payment may need to be returned. It could also lead to a civil penalty.

6

Sorry, I meant after the tenancy agreement has been signed and tenancy started, I believe it may still be possible, provided it is not a condition set by the LL, and the tenant has solely initiated it.

7

Thanks all, particularly Richard and David. Much appreciated.

Details : Age 57. Single. No family. No vices. No smoking/drugs/partying etc. Actively prevent mold by regular ventilation. No pets.

Assets (UK) :
GIA (General Investment Accounts) : Cash : £120K (3 years worth of expenses) High Yield Instant access cash account.
GIA (General Investment Accounts) : World Equity Index fund : £280K
Cash ISA : £100K
Stocks and shares ISA : £300K : Same boring world Equity Stock Index fund and global bond fund hedged to sterling
SIPP deferred Drawdown : £800K in Money market plus global bonds hedged to sterling (hit million in SIPP - crystallised and took out 250K)

SIPP not to be counted as I am not planning to drawdown soon. If I do, I will take out max £12,500 pa taking another 15K from ISA and 15K by selling equities in Taxable to fund my £40K and replenish my cash buffer (simplified “bucket” strategy).

Total UK liquid net worth : 120+280+100+300+800 = £1.6 million. Can produce latest statements from banks and retail brokerages. Have all tax returns, old pay stubs etc. No wealth manager.

Also have plenty more funds in US in World Equity Index funds. Need to sort out pre-2008 non dom issues with “mixed capital”. Will likely use TRF (Temporary Repatriation facility : 12% tax this year and next) to bring them over to UK. But I pay UK tax on arising basis on global income.

Global Stock bond radio is 50/50 - even if equities crash 50%, I will still be well over £1 million.

I embrace simple living so looking to rent a 1 bedroom flat for £1000 pm or so. I see no need to live in a castle.

Source of funds : Worked decades in US tech company in business I.T, moved globally, stock options, stock grant, got a bit lucky and sank lots into ISA and SIPP with frugal living. Tired of corporate politics so left. Can get back to the same sort of business I.T work I used to do but I wasnt exactly curing cancer or running protein folding at Deepmind or pioneering quantum computing etc.

Can buy a property but I am reluctant. Buying in cash means its a substantial sum of money and I fear I may get cheated and buy a lemon - hidden mold problems etc, I dont know. I am not a hands on practical sort of person. Cant be bothered with roofwork, boiler breaking etc. If I had a family and children it would make sense. Can consider a 1 or 2 bedroom house but they are too small. 3 beds are too large. With my funds, I may be able to rent for life. I can also easily go away to Cyprus, Malta etc if the tax situation gets more punitive in UK. Buying seems like a commitment.

Well thats my situation. If landlords and estate agents insist I must have a professional PAYE job with a fancy title (Senior Manager, Head of Marketing, Principal engineer etc) then I wont pass. But if it is ability to pay rent for a normal modest 1 BR, I certainly can, for years / decades - unless SouthEast ends up like Monaco :slight_smile:

Thanks

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@Nightwatchman if you are concerned about not having skills to maintain a property you can pay somebody to do it (and homeserve or home insurance for emergency issues) - electrics or plumbing or roofing or boilers need to be done by qualified pros anyway.

If you are worried about buying a property with problems get a full survey done (and take a friend with you on viewings who’s owned a place and knows what goes wrong and what to look for). And/or buy something brand new or built relatively recently.

Worried about buying a lemon- do what you do when renting compare lots of different ones at around your budget to get idea of prices don’t buy the cheapest or the most expensive. If it would make sense if you had a family it still makes sense for you alone

Think about it like this. Spend 350k on a house. Suppose after 15 years it had lost 50% of its value (which would be a huge loss). You sell at 175k. Cost to you was 175k. If you are spending 12k pa now in rent then with inflation you will spend 175k in around 10-15 years. So cost is same over 15y. But beyond then your housing is free as you don’t have rent to pay. Suppose you live a further 30 years. Even without inflation that’s 30 x12k = 360k saved compared with renting.

And buying isn’t a lifetime commitment- you can try it and if you really can’t figure how to find someone to fix a boiler or a roof or to organise that stuff for you, or looks like you might lose value with price falling then sell up and go back to renting. But honestly it’s no harder than explaining to a Landlord or letting agent and they then find a tradesman. You just use checkatrade or mybuilder . Com or someone recommended or who you used before.

Good luck

9

Why would you want to rely on a landlord to get things sorted rather than yourself? Just get tradesmen in.

Buy it when you need it, sell it when you don’t.

Get a full survey done when buying.

Theres a phrase….safe as houses.