Advice on buying a house with self-contained flat

lincroft1710

In England you would have to make alterations to the flat if you wanted to merge it back with the main house. If you do buy the house and wished to do this, ask the Valuation Office Agency what you would need to do if you wanted the property as a single dwelling for Council Tax purposes.

If this was your intention, then I would think carefully about whether this is the right house for you as you're probably paying extra to reflect the cost of the flat conversion.

djdagz

Thank you all

Spoke to First Direct today and they wouldn't give us a 'normal' mortgage if we were going to rent out the basement flat. Looks like we'd have to get a BTL mortgage, and the rates are not very good on those - basically prices us out of buying the house.

They would've given us a mortgage if we were going to convert it back to one property though, in case that helps anyone.

PasturesNew

djdagz wrote: »

Hello All

We're looking at buying a house, where they have converted the basement into a "self-contained garden flat". Briefly looking into it on the net, it looks a bit of a minefield! However renting it and using that money to help pay the mortgage sounds a great option. My questions are:

1) Does it count as a self-contained flat if the water tank is in the main house? I'm thinking could I rent it under the "rent-a-room" scheme for tax purposes?

2) Both properties have their own council tax. For any periods where we couldn't rent it, would we have to pay that council tax?

3) If we jointly owned the property, how would the tax work on the rented income? Would one of us declare it, or both declare half?

4) Would we just get a normal mortgage on the whole property, then be able to rent out the flat? Or would we need to get a BTL mortgage on the whole place? Or would you get 2 separate mortgages?

5) Related to above, if it is just one mortgage, how do you claim tax relief on your mortgage interest? Presumably its worked out pro-rata, rather than on the whole mortgage?

We would be living in the main house above.
Thanks in advance for your help

1) Yes. No.
2) Yes, but you can get 6 months' discount if it's completely empty (not furnished).
3) Half and half I believe.
4) It might get tricky there.... depends how much mortgage you want and the lender. Others will know for sure, I've no idea, I just like answering questions.
5) No idea.

I probably scored 2/5 in the answers above

PasturesNew

I was too late....