Investment property without owning current home

Queen_of_the_Hive

I have the opportunity to buy an investment property outright without needing a mortgage which I plan to rent out. After speaking to a relative recently though he mentioned he thought there was a piece of UK legislation that meant you couldn't be a landlord without owning your main home. I currently rent the home I live in Is this is case and what piece of legislation is this? I haven't yet found anything online to confirm this is the case. Thanks and be kind. 

AdrianC

Your relative is wrong.

They've got confused because few lenders will give BtL mortgages to non-home-owners.

[Deleted User]

clarissa62 said:

I have the opportunity to buy an investment property outright without needing a mortgage which I plan to rent out. After speaking to a relative recently though he mentioned he thought there was a piece of UK legislation that meant you couldn't be a landlord without owning your main home. I currently rent the home I live in Is this is case and what piece of legislation is this? I haven't yet found anything online to confirm this is the case. Thanks and be kind. 

There is no UK wide legislation. The UK is covered by four legal systems English law , Scots law, Northern Irish law and since 2007, Welsh law, and three legal jurisdictions; England & Wales, Scotland and Northern Ireland.  In any case whichever juristication your property purchase falls under you won't be able to find anything that prevents you from buying an investment property when you don't already own your own home because it doesn't exist.  Your relative is talking nonsense.

csgohan4

OP i hope your know what your getting yourself into, so much tax, legal and financial implications for being LL.  Tenants can and will not pay rent, it's expensive and lengthy to evict

Comms69

clarissa62 said:

I have the opportunity to buy an investment property outright without needing a mortgage which I plan to rent out. After speaking to a relative recently though he mentioned he thought there was a piece of UK legislation that meant you couldn't be a landlord without owning your main home. I currently rent the home I live in Is this is case and what piece of legislation is this? I haven't yet found anything online to confirm this is the case. Thanks and be kind. 

No such law exists. (and rightly so)

Comms69

csgohan4 said:

OP i hope your know what your getting yourself into, so much tax, legal and financial implications for being LL.  Tenants can and will not pay rent, it's expensive and lengthy to evict

Without a mortgage there's less risk though. It's a sensible investment for 3-5 years if the intention is to cash in and buy own home / move in eventually.

Queen_of_the_Hive

Hi everyone, thanks for the information. The property is in England and was a relative's who sadly passed away last yr and I am in an unique (to me) position to purchase it for a good price in cash. Yes all aware of risks, bad tenants etc but still prepared to take the risk and yes I hope to buy a home for myself in the future (fingers crossed).  

Comms69

clarissa62 said:

Hi everyone, thanks for the information. The property is in England and was a relative's who sadly passed away last yr and I am in an unique (to me) position to purchase it for a good price in cash. Yes all aware of risks, bad tenants etc but still prepared to take the risk and yes I hope to buy a home for myself in the future (fingers crossed).  

Sorry quick question - you have £10k of debt, how will you be buying it outright?

AdrianC

clarissa62 said:

and yes I hope to buy a home for myself in the future (fingers crossed).  

Don't forget that not only will you be using your FTB SDLT status up on this place, but you'll be paying +3% when you DO buy your own home.

So let's think about the property itself. It was an (elderly?) relative's place.
What condition is it in?
Is it an easily lettable type of property in an easily lettable location?
Are there any lease restrictions on letting it?
Have you done the sums on realistic net yield, and how long will any prep take to repay?
Perhaps most importantly... are you mentally prepared to dissociate it from being "Gran/Uncle Ted's home" and accept that it's just an asset of your lettings business...?

Queen_of_the_Hive

I have the information I need to know. 
AdrianC and Comms - thanks for your concern but funds are a private matter and all legal. No further replies to this thread is required. 

Comms69

clarissa62 said:

I have the information I need to know. 
AdrianC and Comms - thanks for your concern but funds are a private matter and all legal. No further replies to this thread is required. 

Wasn’t suggesting it was illegal per se. Just to be aware of implications if you’re getting a good deal on a probate property; it might come back to bite you