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haf1963

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Everything posted by haf1963

  1. I have heard good things about sheffield and its a few years behind nottingham in the cycle - with my limited knowledge. Both good choices but also have good/bad areas so plenty of research and maybe some local knowledge needed. I came across some good sheffield property forums where local investors gave comments so worth tracking some of them down as well. Good luck and the key will be to get started as I spent/wasted an antire year looking for the 'perfect' deal - which doesn't exist and if it does then there are plenty of cash buyeres ahead of you..
  2. HMO is indeed more difficult to manage but do-able with help or good agent. I would not look atr students at all but working professionals and am specing my hmo high with onsuites etc to attract them. If you are in no rush to get money out of the Ltd then its a good way to proceed. I have no clue about Leeds so of you think your areas have strong potential then thats fair enough. Ultimately you have toi actually get going at some point and then you will be a lot wiser after the first purchase - good or bad - so maybe if yopu think your orginal stratgey is reasona bl ethen get your first proeprty done and then re-evaluate. As many others have said, the reality is usually different to the theory and no-one can really give you any guarantees about which area/strategy will work best for you I have learnt a huge amount about tax/ltd/regulation/planning and all sorts along the way and my BRR stratgey worked out reasonablly well so far - though real income levels have been lower than expected.
  3. I am assuming you have though through the tax implications to see if the num bers stack up. Getting income out of LTD is not easy (as i have found) so this really needs to be thought through before execution of the strategy. I would be nervous about a LTD strategy for 2-3 properties only as its very likely the income will be very much reduced after mortgage costs, capital gains tax, paying an accountant etc. After 5 years (and 5 properties) I am doing my first HMO as the income from traditional BTL in a LTD is really not sufficient to give up the day job. As a long term pension investment then thats another story. As I said in another post, starting out in property today is very different to 10 years ago and needs lots more thought - especially from a tax/regulation perspective.. Don't let this put you off but do think through all the angles.
  4. I don't know leeds that well but this stratgey sounds like you are going for the bottom end of the market in terms of quality of housing and tenants. As a income strategy it has some merit but I am doubtful you will get strong growth in these sorts of areas any time soon. Rather than voids I would be worried about evictions and the cost of these is much higher. I looked into a similar strategy in the midlands and after 1 property, i switched to the a better area with better tenants which meant going from 100k to 150k properties. I am now glad i did as have had decent growth as well as reliable tenants. Good luck but as others have said you need to think it through very carefully.
  5. I also looked into it a couple of times and decided it was high risk and expensive so went down a different path of getting loans via other people I know. Obvioulsy if its the only way to move forward and the costs can be factored in, then its workable.
  6. I should have clarified by saying 'from an income perspective' more than capital gains and also it does depend on what level of return is deemed 'successful'. It also depends on what your goals are and your existing tax position If you bought traditional BTL in a reasonable area with a mortgage and rented out then its likely the gross income is 6-7% and probably 50% of that is the mortgage payment - given its likely you have a ltd company due to tax rules. To get a decent income you will need 5-10 properties or go down the increasingly difficult HMO route. Then there are the problems assciated with getting your money out of the ltd company due to more tax implications. There there is all the regulation stuff to keep track off. Obviously the big payoff wil be after good price growth over time but thats not a guarantee either. Don't get me wrong in that I am doing ok (after 5 years) with a small portfolio including a hmo but my point is that property is much harder now than it ever was and if i look at my pension investments with tax relief over the same timeframe then I have done pretty well. It would be a different story if i wasn't close to retirement or if i was looking to 'leave a legacy'. I guess my point is that we are no longer in an environment where 'you can't go wrong with property' and its often teh 'default' choice for people to one where you need to think a lot more carefully about all thats involved and what you are trying to achieve. In 5 more years when i decide to sell up, it will be interesting to see what my net profit is from the portfolio. I am still glad I did it (for diversification) but its been a lot more effort than i exepected given returns so far.
  7. I would add that if you are looking at a 5-10 year time frame then property may not be the place to invest - for the reasons above
  8. Not sure much will happen for a few months but with all the commitments to infrastructure spending/house building etc it does look like things will get better in the housing market through 2020 - a 'boom' is another question...
  9. Just bringing back this topic and owndertinf anyone has tried to get a refund for a uninhabitable property. I wrote to SDLT office and it took them over 4 months to reply to me and say 'unable to comment as sdlt already paid' and to call them to discuss. In parallel i was advised to contact Primas Law as they have setup a task-id and team for this purpose so I have now contacted them and see what they say.
  10. My experience over past 3 years via acutions is that in west mids is that there are no backdated charges but there are also no discounts for unoccupied or even un-inhabitable.
  11. Yes a couple of hundred is about right but they will not ge giving you any guarantees given that the legal pack is more than likley going to be missing things. Its very rare for a property to come to auction if everything about it is 100% tip-top shape. Mine does it for free as i have used him to buy a few properties but i tend to review most of it myself and he has a quick-ish scan to see if he can spot anything obvious.
  12. I am finding the ltd company is not so great if you want to exit and not leave an inheritance...
  13. there was a discussion on this earlier which may be helpful..
  14. Releasing equity via. a remortgage is fine and you can do what you like with it inside the company. Releasing equity by selling a property is a different matter as its capital gains so fully tax-able
  15. in principle you can use profits from one property income to offset expenses in another but the work you do in the other property has to be legitimate 'expense' and not 'adding value' i.e upgrades etc. So if you are replacing a bathroom/kitchen in another rented out property (due to it being no longer fit for purpose) then thats fine but if you are doing a refurb before renting or doing an upgrade that adds value then it can't be written off against income. It will be part of your capital gains at a later stage
  16. No NI upto £8000 and no issues with a Director taking salary or even paying into a personal pension. Plenty of options
  17. In short you have to pay corporation tax on any profit regardless of what you do with them. obviously you can pay yourself a salary or various other things to minimise the profit. Also you will have to pay tax again if you take out company profit as dividends/salary etc Its perfectly possible in a small ltd to make no profit for a period as you will have many expenses
  18. best result is tactical voting and a hung parliment.. keep both ends of the extreme in check
  19. You definitly need to pay stamp duty and the transfer will not be straight forward given there is a mortgage company involved and the LTD is efefctively buying the property from you. I have only done this as 'cash' so not sure of the mortgage implications and if they are a showstopper
  20. I doubt very much if there will be anything happening anytime soon after the election - at least on anything other than brexit
  21. I will be very impressed iof a 100k property with 20k refurb gets valued at 170k. I'm assuming you are somehow getting well below market value through sourcing etc. Great model if it works in real life so good luck
  22. I think the above comment is a bit harsh as I know a few landlords who 'specialise' in this type of letting and make it work. The quality/locality of the property is typically at the bottom end and the rent is lower than private. The rental guarantee and zero hasssle given the low value of the property can make it work. Typically you need to be a cash buyer and not involve mortages etc. Obvioulsy there is a queston of whether you are 'comfortable' with this kind of investing - but plenty are. Not for the faint hearted for sure
  23. splitting a property into 2 flats is fraught with difficulty - especially if its a residential house in a residential area and the only way to get any idea if its poss is to either talk to the council via a pre-app or consult a planner to see whats possible/likely with the council in question. I ssupect a betetr bet is to buy a house thats already converted but needs refurb/modernisation as thats a lower risk. Personally I am not convinced of the benefits as a flat conversion tends to be a godo option when its multiple flats rather than just 2. Its also true to say that you are much more likely to make this work if its a cash purchase as most mortgage companies will not be at all keen in allowing it. Aside from that I agree with conrad on the SDLT stuff.. As he said its a complex area with tax implications as well as verious others so not to be taken lightly.
  24. Agree 100% that he auction house/seller can put whatever they want in the legal pack/contract and I have seen cases where its 10K+ worth of 'costs' so you have to factor that into your top bid or avoid alltogether
  25. It depends on how much you want the property and how much someone else does. If you are happy to walkaway then make a second 'best offer' - say 105k and then walk away. If the property suits your needs and you feel its worth 210 then its hard to avoid some kind of bidding war.
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