Add another BTL now or wait after April rush?

Glover1862

I would be interested in peoples views, I appreciate it's crystal ball stuff! So, buy now or wait until things settle down and cough up the 3% stamp duty in the hope that more 1 and 2 beds flats come on the market. I've noticed most of the flats available come tenanted so maybe being an existing landlord could put me in a good position, certainly seems some are selling up.


With stock markets tanking and general gloom around I'm thinking now might not be so great time to buy,but then again I am looking at the bottom of the market in Milton Keynes/ Luton areas at about £130k mark so might be safer in a downturn as bottom of the rung anyway!

Generali

At that purchase price stamp duty will be a pretty small proportion of the consideration on the house and, as you say, if you buy a cheap house there's only so far it can fall as it can't really go below £0 under UK rules.

A tenanted flat in some respects reduces your risk because it comes with an income and no initial void. There is a risk of what is known as 'asymmetric information' whereby the seller knows why she is selling (e.g. crappy tenants) which you don't know about but then that's the case with any second hand purchase.

Stock markets tanking mean you can get more shares for your money right now and the CEO of BP isn't going to call you up on Xmas day because his boiler is FUBAR'd.

Just sayin'.

purch

Generali wrote: »

CEO of BP isn't going to call you up on Xmas day because his boiler is FUBAR'd.

The way his company is going, he just might possibly be renting a 1 bed flat soon :eek:

Glover1862

I've lost shed loads in shares now and in the past, so reluctant to get into that again, but I take your point, much easier than tenants.


The seller I'm seeing tomorrow has agreed to give notice and sell as vacant however existing tenant seems to be good payers and would happily stay on, just makes mortgage more complicated.


Almost £4k extra stamp duty which is quite a lot as it has to be taken out of the deposit, over time relatively small, I could have more choice come April but might have to pay £4k to find out!!

michaels

Locally the market seems crazy at the moment so I have decided to wait and see what happens, if you get the property for 5% less in the autumn that mroe than covers the 3% stamp duty.

Generali

purch wrote: »

The way his company is going, he just might possibly be renting a 1 bed flat soon :eek:

Doin' better than Glencore I reckon. I wonder how much the Xstrata disaster is worth now, post merger...?

michaels

Generali wrote: »

Doin' better than Glencore I reckon. I wonder how much the Xstrata disaster is worth now, post merger...?

That's my pension y'all joking about

Glover1862

michaels wrote: »

Locally the market seems crazy at the moment so I have decided to wait and see what happens, if you get the property for 5% less in the autumn that mroe than covers the 3% stamp duty.

Do you think more stock will be around? like you said crazy at the moment with everything going at asking, not sure we'll see 5% off to offset the stamp duty myself. One of the reasons for waiting is that quite a few landlords have not realised the affects of the recent changes, also flats that didn't make the April deadline might reappear.


I'm self employed and can split my wages with my wife so manage to keep out of higher rate tax, finding the extra stamp duty upfront will deter quite few though.

michaels

Glover1862 wrote: »

Do you think more stock will be around? like you said crazy at the moment with everything going at asking, not sure we'll see 5% off to offset the stamp duty myself. One of the reasons for waiting is that quite a few landlords have not realised the affects of the recent changes, also flats that didn't make the April deadline might reappear.


I'm self employed and can split my wages with my wife so manage to keep out of higher rate tax, finding the extra stamp duty upfront will deter quite few though.

I think it is a false market that the moment due to the tax change...but then going forward the supply/demand fundamentals remain very supportive so who knows....

Obviously currently it is nice that standard rate taxpayers won't be taxed on turnover but the fact that they have made one change towards taxation of turnover makes me nervous about what else they might do.

westv

I didn't realise until the other day that this stamp duty change affects all houses down to £40,000 - rather than the £125,000 for regular stamp duty.

Generali

michaels wrote: »

That's my pension y'all joking about

It's yo pension yo messin' wid.

Overweight Anglo? Sheeesh.