Buying in London vs Midlands - Offsetting Rent

Doozergirl

£100-120k is a cheap house for the Midlands even. Not an amazing quality of tenant invited to that party.

LateStarter

You'll find it difficult to get a But-to-Let mortgage if you don't already own a house. I know London's stupidly expensive, but if you can afford the mortgage payments, it makes more sense to buy something for you to live in.

luckbox

The Government has recently given first time buyers a no stamp duty incentive, so you would be wasting this if you bought a cheap house just to rent out and then decided to buy in London at some point as you would no longer be a first time buyer.

This means you could easily have more than a years worth of rental profit used just to pay an unnecessary stamp duty bill

Filo25

luckbox wrote: »

The Government has recently given first time buyers a no stamp duty incentive, so you would be wasting this if you bought a cheap house just to rent out and then decided to buy in London at some point as you would no longer be a first time buyer.

This means you could easily have more than a years worth of rental profit used just to pay an unnecessary stamp duty bill

With the way the political winds have been blowing for a while I would much rather be buying to live in than buying to let out.

Mahsroh

Doozergirl wrote: »

£100-120k is a cheap house for the Midlands even. Not an amazing quality of tenant invited to that party.

Agreed with your first point on this thread. Not this one.

I own a house in the midlands - it's value is circa £100k - £120k. Every Tenant I've had in it so far has been absolutely spot on. Perhaps I've just been very lucky.......

Nothwithstanding that, as a Midlander, now living in the South East, with a rental property in the Midlands, and living as a private tenant in the South East..... I would recommend buying in London (even though house prices are on the up in the Midlands!).

saajan_12

Being a landlord and tenant elsewhere is a very inefficient way, both in terms of tax and your time, and can end up being the 'worst of both worlds' in your flexibility should things change.
1) income tax on rental income while paying gross rent
2) have to coordinate with an extra person, LL / tenant for repairs
3) overlaps in paying rent when you move / your LL wants to sell but voids in rent income when your tenant moves
4) letting agent fees to pay from both ends.
5) Pay rent (usually higher than a mortgage for same property) but also pay repair & maintenance costs for your let property.

Mahsroh

saajan_12 wrote: »

Being a landlord and tenant elsewhere is a very inefficient way, both in terms of tax and your time, and can end up being the 'worst of both worlds' in your flexibility should things change.
1) income tax on rental income while paying gross rent
2) have to coordinate with an extra person, LL / tenant for repairs
3) overlaps in paying rent when you move / your LL wants to sell but voids in rent income when your tenant moves
4) letting agent fees to pay from both ends.
5) Pay rent (usually higher than a mortgage for same property) but also pay repair & maintenance costs for your let property.

This. Speaking from experience. 100% this.

sunnysoho

Thank you all so much for your sage advice.

You've all been super helpful.