I think your helping out of friends in need is really laudable, and that's an excellent use of a second property.
Essentially, you were providing social housing, like what councils do (or at least, did do) but with a lot more of a friendly face (and in one case total abolition of rent). Doing that for no benefit to yourself is a truly noble thing.
To see this issue clearly I think we need to consider what housing is there for. When there are people without homes it makes me feel uneasy that some people have more than one. Such people tilt the 'people:available homes' ratio and make it harder for poorer people to get a home.
As George Monbiot notes in a piece about holiday homes,
"In England and Wales there are 250,000 second homes. In England there are 221,000 people classed as single homeless or living in hostels or temporary accommodation (these desperate cases comprise about 24% of those in need of social housing)".
The holiday home owners have houses sat empty most of the time whilst people are in need (I've seen people living in caravans through Hebridean winters in sight of houses used for 4 weeks a year).
The other kind, the buy-to-let people, may fill their property but in charging the cost of the house plus the cost of their dividend for being rich enough to front the mortgage, they force housing costs up.
Personally, I agree with George Orwell:
"the ground-landlord in a town area has no function and no excuse for existence. He is merely a person who has found a way of milking the public while giving nothing in return. He causes rents to be higher, he makes town planning more difficult, and he excludes children from green spaces: that is literally all he does, except to draw his income"
('As I Please', Tribune, 18 August 1944)
Now I understand that you're not Rachmann here and you've used your second property well for a time. But renting it out at market rate still puts you in that bracket Orwell speaks of.
I do understand that some people like (I'm assuming) yourself end up with a chunk of money that's surplus to requirements now, but they're still not millionaires and want some wise, simple and reliable thing to do with it for a rainy day or when they retire.
I know several people who've been in that position who've invested in housing co-operatives. This enables people to buy houses collectively, to be owned and controlled by those who live in them. For Radical Routes, the network of co-operatives of people with a social change agenda, the repayment rate to their Rootstock investors is 100% - not a single defaulter ever! Mystifies the banks, that one.
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