Renting my House

lindabea

Hello everyone

I'm considering renting our my 3 bedroom detached property for maybe a year or 2 or perhaps until there is some stabilisation in the property market. Would this be a good time to rent rather than sell? Also, I'm new to the renting market and I don't know what costs I would incur, such as agents fees, income tax and CGT. Can anyone advise what costs I would need to deduct from the rental income. I'm trying to decide whether the rental option would be financially viable. I'm not totally sure!! Any advise would be appreciated.

moneysavinmonkey

no this is not a good time to rent. rent's are low but house prices are high. you'd probably earn more by selling and banking the cash in a high interest account and without all the hassle as well.

poppy10_2

Deffo sell rather than rent it out - house prices will only go down.

silvercar

No CGT if you have lived in the home and sell within 3 years of moving out.

Allow agents fees of 10% (finding tenants only) or 15% (full management).

You will be taxed on the rental income less allowable expenses (expenses include maintenance, gas safety check, mortgage interest).

moneysavinmonkey

silvercar wrote: »

expenses include maintenance, gas safety check, mortgage interest......

........cleaning costs, plumber/electrician charges (including emergency call out if tenants heating breaks at the weekend!), landlords insurance, buildings insurance, professional fees if their services are needed e.g. solicitor, accountant, emergency funds incase of tenants not paying rent/trashing furniture etc; any additional mortgage interest or fees (a BTL mortgage or permission to let is needed); cash to get the property up to regulations e.g. smoke alarms, fire blankets as appropriate, fire retardant furniture, possibly fire escapes and special doors if it's going to be a HMO; if you aren't going through an agent you'll also need to pay for credit checks, tenancy agreements + possession notices, membership of a landlords association, TDS scheme; inventory clerk...

these are just off the top of my head, i'm a tenant not a landlord!

rosysparkle

silvercar wrote: »

No CGT if you have lived in the home and sell within 3 years of moving out.

Allow agents fees of 10% (finding tenants only) or 15% (full management).

You will be taxed on the rental income less allowable expenses (expenses include maintenance, gas safety check, mortgage interest).

Fees will be plus VAT, too.

A_Nice_Englishman

Let me get this right. You are thinking of renting out your house, incurring all the expenses mentioned above and paying income tax on any profit you make?

Presumably you are going to need somewhere to live yourself so you will need to pay about the same rent as your tenants if you want somewhere comparable.

Doesn't seem like a very good idea to me.