Property Investment Advice

lottie3000 · 18 March 2015 at 12:31PM

Hi All on here.

Just a quick question to see if anyone can point me in the right direction for some investment advice where property is concerned. I live in Gloucestershire but don't know whether that applies these days with the differing forms of contact.

Thanks in advance.

droopsnoot · 18 March 2015 at 1:47PM

Are you looking to buy property for investment purposes (buy to let for example) or buy into a property-based investment fund, or some other method of investing in property, or investment-related question regarding a property you already own?

I know of a forum that deals with property-related investments, but I haven't looked there for ages and it's always been on a "what if?" basis, so I'm reluctant to name it in case it's since been discredited or if there is something better.

lottie3000 · 18 March 2015 at 3:15PM

I am looking to buy a property to let, i'd really like to get some advise as to how much money I could put down and then get a mortgage for the remainder of the house on an interest only term. I'd also like some advise as to how this would effect my income tax and how I would be declaring it. Also the tax implications when I come to sell the property, i'm new to this and think I need to firm up what I can and can't or should and shouldn't do. Will a standard financial advisor be able to help me? I've tried looking on the internet but the information is very sparce, I know there is a lot of advise knocking about on here and wondered if someone who buys to let or to renovate and re-sell could offer any advise or point me in the right direction.

AlanP_2 · 18 March 2015 at 3:18PM

You could start by having a read through here:

http://forums.moneysavingexpert.com/forumdisplay.php?f=16

lottie3000 · 18 March 2015 at 3:32PM

When I say 'I'm new to this' I mean I am new to investing in property, I understand how to find, buy and get mortgages on a property. It's the other things that need to be taken into account when buying to let that I am new to.

Archi_Bald · 18 March 2015 at 3:42PM

Agree with AlanP.

BTL should not be seen as an investment but as a business (nothing wrong with starting a business).

If you want to invest in property, you can do this through various property funds. These should form part of a balanced portfolio as having all your eggs in one basket is generally a bad idea.

lottie3000 · 18 March 2015 at 5:04PM

I'm happy to start a business, see this is the advice that I need. When I open AlanP's link it just goes to the House Buying, Renting & Selling.

I don't personnally know anyone who buys to make money or rents and I'm not really sure where professionally to go to get advice. Thanks for your time with your reply. I'm not sure that I understand what you mean by various proprerty funds? So it's all well and good that I think I have enough money to invest this way but a fool and their money are soon parted!!

Daniel54 · 18 March 2015 at 5:37PM

lottie3000 wrote: »

I'm happy to start a business, see this is the advice that I need. When I open AlanP's link it just goes to the House Buying, Renting & Selling.

QUOTE]

There is a wealth of information about BTL on the board AlanP linked to and on the mortgage board.If you use the the search function you might take some time reading through some relevant threads.Alternatively re-post your question there,but it would help you to do some basic research first so you can ask pertinent questions

Buy to let mortgages do not work under the same rules as residential mortgages as they count as unregulated lending.Have a read here

http://www.moneysavingexpert.com/mortgages/buy-to-let-mortgage

To answer your earlier questions simplistically

You would most likely need a 25% deposit and to be a homeowner yourself with an income of over £25k.There are exceptions to these rules and you would be wise to consult a whole of market mortgage broker.

Interest on the loan is tax deductible

Rent needs to be 125% of the mortgage interest payments

Rent after tax allowances is taxed as income

Any increase in the property value would be subject to CGT when you sell

AlanP_2 · 18 March 2015 at 5:39PM

I was referring you across to that general board as you say, doing a "Search This Forum" (top green bar under Page Numbers) using "BTL" as the search term brings up lots of threads on the subject. Whether they cover your specific queries or not I do not know.

Most people on here would probably advise that BTL is part of a broader investment and savings portfolio to avoid putting all your eggs (BTL property, your own house) in one basket (UK Property Market) JUST IN CASE prices tank like they have in the past.

Most also seem to be of the opinion that it is more of a business than an simple investment what with repairs & redecorating, chasing slow payers, advertising and vetting prospective tenants and everything else that needs to be done.

Another "downside" is that it may not be easily converted into cash if you need the money in a hurry and Sods Law insists that day will be just as the market nears the bottom.

As for tax I am no expert but I believe you can offset the mortgage interest and expenses involved against rental income with the residue counting as income for tax purposes.

If it was me I would have a chat with local Residential Lettings Agents and Estate Agents about suitable property types in your area and how rents, mortgages, prices etc. stack up locally.

We looked into it and decided it wasn't for us given the lump sum we had, local prices, mortgage rates and the hassle factor but some people go for it big time.

My BiL has a number but he buys renovation projects and has the skills and contacts to do them up for a lot less than you would pay tradesmen so his overall cost works out lower.

Worth reading through this series of articles and related links:

http://www.thisismoney.co.uk/money/mortgageshome/article-1596759/Ten-tips-buy-let.html

lottie3000 · 19 March 2015 at 9:37AM

Thanks for responses, I will get reading on the other board and pop a post on there too.

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