I Wish To Start Renavating Propertys, And Would Like Some Info Please

IAN_moone

Hi guys

To cut a long story short, some things in my life have changed recently and its given me some time to think about where my life is now and where its heading to.

I want to go in a new direction and renovating propertys is something im currently weighing up.

what i am really interested in learning about is the whole process of how the costs of this venture will work. i really don't know much about this stuff yet (you guys are my first bit of research) so basic things such as stamp duty etc i really know nothing about.

it might be a big ask but could somone give me a little ordered list of each cost that will be involved in the buying and selling process (not the renavation itself). Also how any profit be taxed?

thanks guys, and for the record i know this is probably a mental time to be talking about this, but if i do decide to venture into this game it will not be for a couple of years minimum.

Any people who have tried to do this, whether it was a success or a failure i would be interested in hearing your story

Thank You and apoligies if this is in the wrong section

BitterAndTwisted

Buying:

Find a property and have a builder with you to price up the work.

Instruct a surveyor: Homebuyers £500 Full structural £1000

Instruct a conveyancing solicitor: £1000

Selling:

Estate agents fees: 1-2% of sale price

Conveyancing solicitor: £500

Stamp duty can be looked up, as can the tax on any profit on the HMRC website. I think It'll be attracting Capital Gains Tax if you don't live in it as your principal residence. You might be exempt from Council Tax while it's unoccupied and uninhabitable.

Do your sums. The gravy-train of property renovations left the station some time ago. Only the very experienced at it are making good money now.

IAN_moone

ok thank you for your time

this is something to get started on.

can anyone explaing to me why ill "be attracting Capital Gains Tax"? i do not intend to live there as it goes. is there a proper clear cut rule about this? i would still have a full time job if that makes any difference

also if i did buy a property it would be well below 125k so stamp duty is not thing i have to worry about (as things stand) right?

I think i should stop being so impatient and just do my own research, i got plenty of time. its just google tends to either tell me about how it works in other county's or takes me to someones site telling me they can make me millions if i just buy there e-book lol.

BitterAndTwisted

Look up Capital Gains on the HMRC website. They have guidance notes to do with property I believe. No stamp duty under £125k. That could change, of course.

Yes, do your own research and stop being so impatient. Research and patience are things you are going to need in spades if you start a new career as a property developing magnate

GDB2222

You won't pay CGT, but you'll pay income tax on the profit, as you'll be trading.

motherofstudents

I would say make sure you get the porperty at the right price. The cheaper you can buy it for, the better. Shop around for things like kitchens and bathrooms and don't get carried away. Buy the property for as little as possible (you could get a bargain with something that has had a bad fire and looks awful). Do the renovation to a high standard. Good luck, I hope it works for you.

G_M

If you own a property, don't live there, and make a profit between buying/selling, you are liable capital gains tax (a 'gain' on the value of your 'capital' - gerit?)

If however you buy/sell several properties, it is classed as running a business - so liablity is for income tax.

The best advice is to go tour local library and borrow for free one of the many books published on buying property for profit!

geoffky

You will be a millionaire before your fourty..just like the rest..good luck...you will need it...creating value is the hardest thing to do..And you do know that in a falling market 6 falling months could wipe you out,,

agrinnall

IAN_moone wrote: »

I think i should stop being so impatient and just do my own research, i got plenty of time. its just google tends to either tell me about how it works in other county's or takes me to someones site telling me they can make me millions if i just buy there e-book lol.

If you are getting too many non-UK results from your search you can use the Advanced search functions in Google to either specify the domain of the search (eg .co.uk) or set the region to United Kingdom, you may miss out on some results but everything you get should be UK based.

00ec25

BitterAndTwisted wrote: »

I think It'll be attracting Capital Gains Tax if you don't live in it as your principal residence. now.

No - the Op's stated intention is to "do up and sell"
the OP would therefore be trading and so his profits would be subject to income tax not CGT

It is irrelevant that the OP has a full time job, the profits from hIs property development trade would be subject to income tax just like the income friom any other second "job"

david29dpo

Your biggest problem (and mine) is knowing your selling price. Plenty of houses for sale that need work.
Basically (before the bubble burst) You more or less know the finished selling price, deduct you costs, fees etc, add your profit and bingo you got your buying price.( I am lucky that i can do all the work myself to keep costs down).
Not any longer.
My last one (which went on the market the day before Northern Rock went tits up) is how rented out. £10,000 loss if i sold now!
So, unless you have a crystal ball and know your selling price or don't mind ending up being a Land Lord, try something else.