Shared ownership and purchase of another property

MaRaS

Hi,

I live in shared ownership flat that we bought with my wife. Unfortunately my wife passed away recently and i got quite large insurance payout. i do not want to staircase as I pay such a low rent it does not make sense at all. however i would like to consider buying another property as buy-to-let so my and my daughter future is better secured.

Now, the question is whether I'm in legal position to buy another property?

I do not want to compromise my shared ownership accommodation, as it is place which we consider home and do not plan to move or sell.

All answers are greatly appreciated. Thank you.

Mark

Ozzuk

Sorry for your loss. Do you really want the hassle of a rental? It isn't as attractive a financial position now, you can still do well if you get the right property but its still a lot of work/risk.

You'll pay higher SDLT, you'll likely be taxed on income, you have the risk of bad tennants/void periods. Might be better looking at other investment vehicles, particular until the market calms down.

theartfullodger

Sorry to hear you story.


Yes you can buy somewhere else. Extra stamp duty as a 2nd property. General advice is never rent to friends & family (not sure if planning to rent to daughter).


Owning property is no guarantee of better security. Better to spread any investments into different areas (you existing place, couple of other investment areas..)

Slithery

MaRaS wrote: »

however i would like to consider buying another property as buy-to-let so my and my daughter future is better secured.

What research have you done that leads you to this conclusion? Have you investigated all ofthe other investment oppurtunities that could provide greater yields with less hassle/risk?

MaRaS

Hi, I looked into different options like capital investment which in fact give prospect of better return (around 8-9%) for a greater risk of the invested capital, however im a bit weary of the current economy in face of brexit, so i'm not so sure about this route. i've also looked into investing into holiday property abroad with companies that manage them for you so no hassle and quite ok return of up to 6% annually. again i do not have much of experience in this type of investments and do not know anyone who could advice on this. having 2nd property close by is so far the most secure way of investing in my view. bad tenants or void periods can be tackled as a lot of estate agencies offer guaranteed rent and full property management. I know the higher SDTL is pain but that can be swallowed if property will be a long term investment which i plan to be...this way even fluctuation on price will be avoided and in 10-15 years time i will surely be able to sell it with much greater profit.

csgohan4

Spread your risk, don't put everything into one basket like property, unless you can absorb losses.

ISA seem reasonable

MaRaS

csgohan...are you serious? ISA with their such a low interest rates that are below inflation i will be loosing a lot in those...property are essentially guaranteed good return over long period of time. I've done it before twice so i know you are never going to loose on property, even if recession comes around again (been there with my first property and still managed to get healthy profit).
Obviously not only property but at least i know this way of investing better than capital investments or holiday/managed properties.

csgohan4

MaRaS wrote: »

csgohan...are you serious? ISA with their such a low interest rates that are below inflation i will be loosing a lot in those...property are essentially guaranteed good return over long period of time. I've done it before twice so i know you are never going to loose on property, even if recession comes around again (been there with my first property and still managed to get healthy profit).
Obviously not only property but at least i know this way of investing better than capital investments or holiday/managed properties.

So your buying properties and not renting them out?


If you need a mortgage on your BTL, you risk financial exposure with void periods, maintenance, e.t.c.


ISA come in variety shapes and forms, one being stocks and shares and long term investment done well can be rewarding.


Property is a risk as always will be, look at Ireland and their negative equity issues in the past


Be a property magnate, your choice, but as with anything there are risks