Renting my flat to rent somwhere else

Fruitgums_2

Hi
I'm a newbie and would really appreciate some advice. I am thinking of renting my flat out and rent somehwere else just so that I can be within the catchment area for the school that I'm interested in sending my son. The schools nearby aren't very good and I would loath my son to go there.

I will be about £600 out of pocket each month. This is beacuse I can only rent my flat for £700 and my mortage is at almost £1k. Also, the estate agent said that I am liable for the ground rent & services charges. Plus to rent somewhere else it's between £1000 - £1200 rent pcm.

So, I guess that I'm just using you as a sounding board and wondering whether I am completely mad to consider this idea?

I've attached a poll to this thread but I'm not sure whether this has worked!

Thanks

lynnexxxo

Is your school of choice within commuting distance of your current flat? Could you move into the catchment area for 6 months or a year and then move back to your own flat and drive your son to school?

Is there nothing cheaper in the area than 1000-1200 pcm?

Can you afford the extra money?

I don't think its mad to want your children to go to a good school. Is the local school that bad? have you read the OFsted reports?

Troubled_Joe

It depends on the notional value you place on the benefit to your son of going to one particular school as opposed to another.

I don't think anyone here can help with that.

As an aside though, you could put him in a nearby private school for a similar price.

m_13

Stay put

Bear in mind that your income from renting will be counted as income and taxed as such so you won't clear £700 per month. You will be able to deduct your mortgage interest from the profit and also legal costs, service charges etc.

Do you know what amount of your mortgage payment, roughly, is interest? If it's half - around £500 - then you will get more profit but if your loan has run for a few years then you might be paying less interest and more capital.

Finally, has your mortgage lender said they will give you permission to rent out your property? They may charge you to grant permission or put restrictions on who you can rent to (no housing benefit or a single family only, for example) or even force you to change to a BTL mortgage at a different rent.

I know I said finally but have you checked that living in the catchment will mean your child goes to that school. There are a lot of very unhappy people near me at the moment because the council allegedly used a lottery to allocate spaces and so children who live almost next to the school did not get places and have to travel elsewhere.

mlz1413

Stay put

1000 mortgage (assuming all interest)
100 service charges
1200 to rent 2nd place
(700) income from flat

---

1600 total out of pocket not 600

I think for the money you are talking of spending you could send your child to a private school or get a personal tutor in.

mustrum_ridcully

lynnexxxo wrote: »

Is your school of choice within commuting distance of your current flat? Could you move into the catchment area for 6 months or a year and then move back to your own flat and drive your son to school?

Is there nothing cheaper in the area than 1000-1200 pcm?

Can you afford the extra money?

I don't think its mad to want your children to go to a good school. Is the local school that bad? have you read the OFsted reports?

I'm sure I heard on the news the other week that the really high demand schools are cracking down on this sort of thing and require that the family remain resident in the catchment area. I don't know anymore, it's just what I heard...

Fruitgums_2

Wow, many thanks for all of your replies. Yes I will be out of pocket £1600 and it may seem very obvious but I have not considered private education but now will definitely look into it.

Also, many thanks for pointing out that the flat rental income will be taxed as this is something that I haven't considered. I guess that I wanted to rent somewhere else as I live in a tiny flat and was looking to rent a bigger place.

I have checked with my county council and they are NOT using postcode lottery but will be allocating places on the door to door distance, which to me seems very fair. In answer to one of the questions asked, yes I have checked the local school Ofsted report and have visited it which is why I feel so strongly about not sending my son there.

I must say that this is my first time on this forum and I'm so grateful for the advice & pointers given here.

Cheers!

Fruitgums_2

Sorry I forgot to answer one of the questions:
My rental address will be the main family resident as I will have to change all of my address details eg GP, bank etc and will be my main residence. This is sufficient for the County Council who will be allocating the places.

bob79

mlz1413 wrote: »

1000 mortgage (assuming all interest)
100 service charges
1200 to rent 2nd place
(700) income from flat

---

1600 total out of pocket not 600

I think for the money you are talking of spending you could send your child to a private school or get a personal tutor in.

The OP does have to live somewhere:p, so when comparing with the cost of private education 600 pounds per month is the better figure IMHO.

Fruitgums_2

Well the cost of private education will be £3000 per term which is going to be a lot cheaper than renting somewhere else.