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    • Goldcrypto
    • By Goldcrypto 7th Aug 18, 11:50 PM
    • 62Posts
    • 5Thanks
    Goldcrypto
    Current property owner and first time buyer - help to buy conflict
    • #1
    • 7th Aug 18, 11:50 PM
    Current property owner and first time buyer - help to buy conflict 7th Aug 18 at 11:50 PM
    My brother bought his first property in his 20's in London and now in 30's. This was bought as an investment as a buy to let property. Now he has never had a property of his own as a residential to live as he preferred renting (the property investment helped him gain good capital growth over the last 10 years and the rental paid down mortgage and covered most of his rental costs for his own living) as he liked be flexible to be able to choose new properties and move around with his work that has quite a bit of international travel.

    Now the 20% loan assistance for first time buyers would not be available to (despite him not actually having a home to live as his main residency) as he would still be classed as someone owning real estate plus he would be hit by the new increased stamp duty costs for a second plus property etc - all seems unfair as those companies with 10+ do not get hit (ie big investors), while the small guy gets hit and plus some people do not like to invest their money in stock market etc, would be fairer if government allowed 1 residential as main residence and at least 1 investment buy-to-let (for those also to be able to claim first time buyer assistance and not have to pay increased stamp duty costs).

    My question (given the background): His girlfriend would qualify for the first time buyer and would want the 20% loan available for first time buyers. Now for land registry when she buys the name would have to be in her name etc but if my brother wanted to give her 50% of down payment and gift her for time been half of the mortgage payments so in x number of years there could be a legal contract she signs (at purchase) that states he has half ownership claim etc? Is there a way to structure this with a lawyer in some way?

    He would not be willing to sell the London property as growth has been too good and expects continued strong capital growth. Even if that was not the case, it is in a very hot rental location so provides great rental income.
    Last edited by Goldcrypto; 07-08-2018 at 11:53 PM.
Page 2
    • Doozergirl
    • By Doozergirl 8th Aug 18, 9:11 AM
    • 25,573 Posts
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    Doozergirl
    You asked for the experience of successful property investors. The experience is that they pay a shed load of tax in the right places, including the 3% surcharge, and don't use their girlfriends to avoid tax. Even if they are avoiding some, they're pouring huge amounts into government coffers from every other angle.

    I wasn't passing comment on the economy at all, I was being facetious; I was passing comment on your attitude. These benefits and penalties are there for a reason and they are specifically to hit your 'brother'. Nobody agrees with you here, they think your attitude is either derisible or a joke.

    He isn't married and he leaves himself wide open to be taken advantage of by his other half. That would be a shame.
    Last edited by Doozergirl; 08-08-2018 at 9:19 AM.
    Everything that is supposed to be in heaven is already here on earth.
    • Goldcrypto
    • By Goldcrypto 8th Aug 18, 9:28 AM
    • 62 Posts
    • 5 Thanks
    Goldcrypto
    You asked for the experience of successful property investors. The experience is that they pay a shed load of tax in the right places, including the 3% surcharge, and don't use their girlfriends to avoid tax.

    I wasn't passing comment on the economy at all, I was being facetious; I was passing comment on your attitude. These benefits and penalties are there for a reason and they are specifically to hit your brother.
    .
    Originally posted by Doozergirl
    Nobody is looking at not paying any required taxes! Is irrelevant if you dislike investors. The question is simply the best options to take given the current legislation. Nothing to do with ones economic views. Going back a few years there would be NO extra SDLT. Those who want a say on changes can keep up to date with their politics and get voting.

    If you read the posts you would have seen that his partner was the one interested from the start for her to be more capital liquid (only having 50% invested and 50% mortgage liability) - irrespective of whether it is the guy as the first time buyer or a girl as the first time buyer or just to co investors where one happens to be a first time buyer.

    He isn't married and he leaves himself wide open to be taken advantage of by his other half. That would be a shame
    Very kind of you to worry about that after scorning him as an investor. It would be treated as a dual investment. Nothing would be invested without deeds.

    Nobody agrees with you here
    Seems then there are not many investors here. Not really the shared response of hard working colleagues in the city.

    Even if they are avoiding some, they're pouring huge amounts into government coffers from every other angle.
    Yes, I am sure. Take with two hands and give back with one hand.
    Last edited by Goldcrypto; 08-08-2018 at 9:42 AM.
    • Doozergirl
    • By Doozergirl 8th Aug 18, 9:33 AM
    • 25,573 Posts
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    Doozergirl
    Yes, I am sure. Take with two hands and give back with one hand.
    Originally posted by Goldcrypto

    Hilarious! Like your brother then?

    The trouble is that people have a habit of believing that other people are like them. Seek someone who dodges tax and takes advantage of government subsidies that they aren't entitled to, and ye shall find.
    Everything that is supposed to be in heaven is already here on earth.
    • Goldcrypto
    • By Goldcrypto 8th Aug 18, 9:58 AM
    • 62 Posts
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    Goldcrypto
    Hilarious! Like your brother then?

    The trouble is that people have a habit of believing that other people are like them. Seek someone who dodges tax and takes advantage of government subsidies that they aren't entitled to, and ye shall find.
    Originally posted by Doozergirl
    On the contrary, I think the other way around. Many hard working British citizens, like my brother, pay honestly and contribute well. I'm supportive of tax rises (when used wisely for UK services etc) in the correct areas.

    Whatever the current legislation is we work with that. Many corporations exploit the UK. Google, worth $Billions, paid a joke of an amount over the last 10 years. If you think corporations are paying their fair share in corporate tax and Londoners are not affected by overseas investors then yes we are on different perspectives to reality.

    Not entitled to? Why would she not be entitled to? What do you object with one person as a first time buyer using their entitlement by the government to buy a property then at a later stage a partner buying up a portion of their property so they can be more liquid? That other person buying a portion of the equity has not used any government subsidy or avoided any tax? That would effectively be the same situation as a 'shared ownership scheme' that is currently in operation where buyers buy with a government ownership scheme. So instead of government benefiting from price increases, the partner or relative or whoever is investing with that individual at a later stage. Are you implying that the first time buyer should not have the right, of their own property, to sell a portion of the equity at some stage?
    Last edited by Goldcrypto; 08-08-2018 at 10:08 AM.
    • Cakeguts
    • By Cakeguts 8th Aug 18, 10:08 AM
    • 4,718 Posts
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    Cakeguts
    What I want to know is how the brother managed to get a buy to let mortgage without owning his own property that he lived in. Did he lie on the mortgage application form?
    • Goldcrypto
    • By Goldcrypto 8th Aug 18, 10:21 AM
    • 62 Posts
    • 5 Thanks
    Goldcrypto
    What I want to know is how the brother managed to get a buy to let mortgage without owning his own property that he lived in. Did he lie on the mortgage application form?
    Originally posted by Cakeguts
    https://www.ft.com/content/73ba7254-154e-11e7-80f4-13e067d5072c

    No. There are different mortgage products out there without been a homeowner. Probably higher rates. However, he was an owner on a deed to a small property from an inheritance, out of London, already.
    • Pixie5740
    • By Pixie5740 8th Aug 18, 10:25 AM
    • 12,699 Posts
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    Pixie5740

    Not entitled to? Why would she not be entitled to? What do you object with one person as a first time buyer using their entitlement by the government to buy a property then at a later stage a partner buying up a portion of their property so they can be more liquid? That other person buying a portion of the equity has not used any government subsidy or avoided any tax? That would effectively be the same situation as a 'shared ownership scheme' that is currently in operation where buyers buy with a government ownership scheme. So instead of government benefiting from price increases, the partner or relative or whoever is investing with that individual at a later stage. Are you implying that the first time buyer should not have the right, of their own property, to sell a portion of the equity at some stage?
    Originally posted by Goldcrypto
    It's nothing like share ownership it would just be two individuals owning the property as tenants in common.
    • Doozergirl
    • By Doozergirl 8th Aug 18, 10:28 AM
    • 25,573 Posts
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    Doozergirl
    I'm not even reading what you're writing as I've told you that the successful investor I work with pays all of the taxes due and you're waffling on trying to conjure up BS diversions about corporations and liquidity when the only question is about taking advantage of first time buyer incentives.

    Can your brother *give* his girlfriend money so that she can buy a house and take advantage of what she is entitled to? Yes.

    Can he then claim to own part of the house? No, because he has to sign a declaration saying that he is giving the money to her and her name is on the mortgage. If their relationship goes wrong before they marry then he's going to have trouble convincing a court that it's his money.

    It's his risk. He decides if it's worth it.

    Is he entitled to FTB incentives? No.

    Should he be? No. He owns a property that he profits from and that is more advantageous than a home to live in.

    Is it fair? Irrelevant, and your whining doesn't justify hiding his money.
    Everything that is supposed to be in heaven is already here on earth.
    • marliepanda
    • By marliepanda 8th Aug 18, 10:28 AM
    • 6,318 Posts
    • 13,451 Thanks
    marliepanda
    https://www.ft.com/content/73ba7254-154e-11e7-80f4-13e067d5072c

    No. There are different mortgage products out there without been a homeowner. Probably higher rates. However, he was an owner on a deed to a small property from an inheritance, out of London, already.
    Originally posted by Goldcrypto
    Oh poor thing, he really IS hard done by isnt he.
    • Doozergirl
    • By Doozergirl 8th Aug 18, 10:30 AM
    • 25,573 Posts
    • 69,399 Thanks
    Doozergirl
    https://www.ft.com/content/73ba7254-154e-11e7-80f4-13e067d5072c

    No. There are different mortgage products out there without been a homeowner. Probably higher rates. However, he was an owner on a deed to a small property from an inheritance, out of London, already.
    Originally posted by Goldcrypto
    So it's his third property? This gets better.

    But of course, it was only a small one. Doesn't count
    Everything that is supposed to be in heaven is already here on earth.
    • Goldcrypto
    • By Goldcrypto 8th Aug 18, 10:30 AM
    • 62 Posts
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    Goldcrypto
    It's nothing like share ownership it would just be two individuals owning the property as tenants in common.
    Originally posted by Pixie5740
    Exactly, but at least the tenant in common is someone you want to have something in common with - no pun intended Ie, both are benefiting.

    Anyway, I thought would be worth asking on a forum to brainstorm some ideas but maybe him best asking a friend in commercial law if he knows any friends in real estate law to offer some other advice on options or go with one already mentioned, if is possible.
    • Goldcrypto
    • By Goldcrypto 8th Aug 18, 10:33 AM
    • 62 Posts
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    Goldcrypto
    So it's his third property?
    Originally posted by Doozergirl
    What makes you think he still owns that?

    I'm not even reading what you're writing
    Oh, I forgot your just cherry picking points you want to read. Silly of me. Thanks for your help.

    You have not even read the options have you? How is he hiding by either buying the property from the start together (her having a lesser ownership) and they then can not use the government assistance but just buy normally or he buys her equity as a new joint mortgage at a later date. She would be buying herself and he could choose if he wanted to refinance his property so he could buy an equity portion. Try and keep up if you want to criticise. Although I do not know what the point is if you have no actual contribution to the question.

    Sorry I am not reading anymore of your posts, following your lead, as it is just green eyed envy nonsense. Clearly not a real estate investor and happy for overseas investors to dominate the landscape instead of been concerned about UK investors. Ciao.
    Last edited by Goldcrypto; 08-08-2018 at 10:43 AM.
    • sal_III
    • By sal_III 8th Aug 18, 10:34 AM
    • 578 Posts
    • 563 Thanks
    sal_III
    Regarding my views, they are irrelevant as the current legislation is in place - these do change so will see what happens in the future. Also, my view on this issue about property investment and implications for SDLT and help to buy are not solely focused on him but should apply to every UK citizen. I personally feel they should have the opportunity (if they are in the position to do so) to be able to get assistance on first residence property and not have additional SDLT on second property purchase (as an investment). Not everyone wants to invest the majority in the stock market with main investments etc. Maybe you think it would be fair if he (or similar people) had a few million and had 10+ properties then he could set up a company for the properties and not have to pay additional SDLT and have access to superior lending options? The government seems to be squeezing the small investor and giving advantage to the big players. Personally, I do not think it is fair for the average hard working British Joe just trying to progress.

    Regardless of peoples current political views on UK real estate policies, I'm here looking for actual technical answers to address the question only. So lets not digress.
    Originally posted by Goldcrypto
    Rubbish, it's clear you have no clue about the legislation. Your borther is free to setup a company even with 1/2 a property, doesn't need 10. But I suggest you double check the SDLT and mortgage rates for companies, before commenting. He is not paying additional SDLT, he is not eligible for relief to reduce the tax due.

    You are complaining that the Gov is squeezing the "small investor", giving advantage to the "big investors" which is simply untrue, while simultaneously whining why the Gov made the rules to favour genuinely first time buyers lookign for a home, over investors like your brother ho already has one. What a hypocrisy.

    "Technical" answers:

    Re HTB Equity loan:
    HTB equity loan is designed for people who can't save for a deposit, because the prices keep rising faster than their wage, and need HELP TO BUY.
    Your brother is not one of these people since he already have equity in another property.
    Even under these circumstances he can use equity loan if he disposes of the existing property.
    Which part of this is unfair?

    Re SDLT relief:
    Again it was designed to help the poor bu**ers that can barely scrounge for a deposit and yet alone tax. One of the reasons it's not available for properties over 500k
    Your brother is not one of these individuals, he already has a property, the fact that he chose to let it out instead of living in it is irrelevant.

    Re his GF:
    All of the above are available to her should she decides to buy alone. Since she wants to buy a property jointly with a well off individual, the above are not available to her.
    • Goldcrypto
    • By Goldcrypto 8th Aug 18, 10:49 AM
    • 62 Posts
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    Goldcrypto
    Rubbish, it's clear you have no clue about the legislation. Your borther is free to setup a company even with 1/2 a property, doesn't need 10.
    I never said he could not set up a company but there is really no point to do that. I do not see any advantage in that? I think it is actually 15 needed to qualify? Certainly out of his reach. He simply wants one future residential property to live in the future and keep one investment property. That is all.
    • Doozergirl
    • By Doozergirl 8th Aug 18, 10:50 AM
    • 25,573 Posts
    • 69,399 Thanks
    Doozergirl
    What makes you think he still owns that?



    Oh, I forgot your just cherry picking points you want to read. Silly of me. Thanks for your help.

    Sorry I am not reading anymore of your posts, following your lead, as it is just green eyed envy nonsense. Clearly not a real estate investor and happy for overseas investors to dominate the landscape instead of been concerned about UK investors. Ciao.
    Originally posted by Goldcrypto

    That's short enough to read. I've cherry picked what is relevant, which is virtually nothing.

    It doesn't matter if he still owns it. It's simple maths. He has already owned two properties so he's not a first time buyer.

    You're good at making things up to suit you. There's 13 years and enough evidence of my experience of property developing written on these boards to fill several books. The evidence also shows what I've gained and learned in that time. There's also clear evidence of integrity.

    People with less money love to whine about how people with more money have it good. It doesn't matter if you have 79p or 79 million. Someone else has always got it easier.
    Everything that is supposed to be in heaven is already here on earth.
    • ashe
    • By ashe 8th Aug 18, 10:51 AM
    • 544 Posts
    • 404 Thanks
    ashe
    Ah the old classic asks for advice, rejects all advice that give the answer he doesnt want to hear approach, brilliant.
    • Pixie5740
    • By Pixie5740 8th Aug 18, 10:53 AM
    • 12,699 Posts
    • 18,127 Thanks
    Pixie5740
    I never said he could not set up a company but there is really no point to do that. I do not see any advantage in that? I think it is actually 15 needed to qualify? Certainly out of his reach. He simply wants one future residential property to live in the future and keep one investment property. That is all.
    Originally posted by Goldcrypto
    Which he can have but not using HTB EL and not whilst avoiding the higher rate of SDLT. The small time property investor is exactly the sort of person the change in taxation is supposed to deter so like it or not the legislation is doing what it is supposed to be doing.
    • sal_III
    • By sal_III 8th Aug 18, 10:58 AM
    • 578 Posts
    • 563 Thanks
    sal_III
    I never said he could not set up a company but there is really no point to do that. I do not see any advantage in that? I think it is actually 15 needed to qualify? Certainly out of his reach. He simply wants one future residential property to live in the future and keep one investment property. That is all.
    Originally posted by Goldcrypto
    Qualify for what?

    He already has a residential property, the fact he opted to let it out, instead of living in it is irrelevant. No one is stopping him from keeping the current "investment" property and buying a new property to live in. People are doing that all the time. Just stop whining there is no tax relief in his case.

    Emphasis on tax RELIEF, significant difference from what you clam - having to pay higher "punishing" tax.
    • Goldcrypto
    • By Goldcrypto 8th Aug 18, 11:00 AM
    • 62 Posts
    • 5 Thanks
    Goldcrypto
    Which he can have but not using HTB EL and not whilst avoiding the higher rate of SDLT. The small time property investor is exactly the sort of person the change in taxation is supposed to deter so like it or not the legislation is doing what it is supposed to be doing.
    Originally posted by Pixie5740
    I agree that is certainly will be working, especially for many retired couples her were maybe thinking about an investment property. However, more should be done for overseas investors. I have quite a few East Asian friends that are certainly enjoying the current state.
    • need an answer
    • By need an answer 8th Aug 18, 11:10 AM
    • 935 Posts
    • 1,142 Thanks
    need an answer
    I'm getting the feeling I've read this posters threads before,not maybe under this user name but he's as insistent as the guy yesterday with the renovation project and how to sell it off to multiple targets.


    I believe there are a few posters who ae under the impression we all need a little summer entertainment....don't rise to them

    The housing boards seem to be dominated at the moment by a few posters who seem fixated about their thread being read and at the top of page 1.
    Last edited by need an answer; 08-08-2018 at 12:09 PM.
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