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Show home leaseback
Lindalane
Posts: 2 Newbie
I am in the process of selling my house and want to buy another but am unlikely to be spending much time in the uk for a while as my elderly mother who now lives alone in Spain following the death of my father is getting quite frail and requires care. For the time being she will not move back to uk so it looks like I will be going over there to look after her. I have seen that it is possible to buy show homes on new developments and lease them back for a guaranteed period and with an attractive rental income. That sounds like a good option for me. However, I am wondering if such a purchase would be classed as a buy to let in which case the stamp duty payable would be likely to wipe out the rental income and I'm not sure it would be worth it. Can anyone advise, please? Any alternative suggestions also welcomed. Thanks.
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Comments
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There is no specific tax on buy to let.
The tax is on buying additional houses once you own one.
If this house will replace your main residence, which it sounds like, there will be no extra SDLT.
It doesn't matter what you do with it. Let it out, live there yourself, keep ponies in it, doesn't matter.0 -
Stamp duty is paid at the point of purchase, what you do with the property afterwords is up to you. There is no difference in Stamp duty.0
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Bear in mind, if you need a mortgage, it will be based on 'vacant possession on completion' and allowing the builder to remain in occupation would be a breach of the mortgage terms your solicitor would have to report to the lender.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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That sounds like you'd need a commercial mortgage as you'll be renting it out for business use.... and then there are the issues surrounding the final conversion/build when it's converted back into a house from a showhome. I'd imagine this is more for people that have cash, than anybody that needs a loan of any sort.
Sounds like a great idea - in the right circumstances, with cash, I'd consider it ... but it's not for those who need to borrow really, imho.
And, if you are borrowing, there'd be questions about your income - and then you'd want to leave the country.
It's not a common set of circumstances.0 -
Thanks for the info, that's useful. I won't be wanting a mortgage so hopefully could just go ahead and buy once my sale completes.0
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