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julia urquhart

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Everything posted by julia urquhart

  1. This might be a good time to do any expensive upgrades - new windows / doors, insulation, kitchens, boiler / heating upgrade - anything that needs doing. These will off set your 40% tax rate and allow you to make improvements a bit more cheaply than usual. You could change the ownership to joint with your partner and use some of her tax band. Or you accept for a couple of years there is a higher cost to your rental business and accept it for the long term good. What you need to avoid doing is a knee jerk reaction to avoid paying tax that costs you more in the future. After all y
  2. As a cash buyer you don't have to wait for a mortgage offer and you could decline all searches - but you would probably not be advised to do this unless you know the property and area very well. You do hear of people getting things through quickly but I always plan for 12 weeks and am not usually far out. Things are taking longer during lockdown too and conveyancers are really busy so although it may be possible I would not bank on it!
  3. This is becoming more and more common and you are right - you have rental income from the start. There are a few things to look out for - and this has been discussed on other threads here if you can find them. You need to be sure that all the correct paperwork was served at the start of the current tenancy or you may have problems issuing a S21 should that become necessary. You need to know that your tenant has paid their rent on time and that there are no outstanding issues. Ask why the LL is selling and does it ring true? You don't want to buy a problem! You need to know
  4. I understand what you are trying to do, but even with unrestricted access to the bathroom this is a small house best suited to a couple. I would question whether the cost of making the access to the bathroom and the subsequent loss of space in the bedroom is really worthwhile. There are plenty of houses like this and if people are happy to rent them then why go to the effort and cost involved in the change?
  5. I think it unlikely you will get a mortgage in your sole name with a low income but as Stuart says you can split the income unequally to make the most of your tax status.
  6. A First Time Buyer is someone who has never owned any property before and you lost this title as soon as you bought a BTL. It may not seem fair but that is what is is. My 3 kids bought a house together and lost any subsequent entitlement to FTB status even though they had only owned 1/3 of a house. Take comfort in the fact that you are a savvy investor who is making money in other ways
  7. Well done on saving your deposit! I understand your logic but I fear you may face a few problems. It may be difficult to get a BLT mortgage when you have never owned a property before plus your lack of experience makes being a LL a bit more difficult - owning a property for the first time teaches you a lot of important lessons. Also being a long way from your property makes buying & running it trickier and more expensive. If you are set on this course of action it is definitely worth talking to a broker to see if you will be able to get the mortgage you need. Many of us star
  8. CGT is paid at 18% or 28% depending on your marginal rate. The gain is added to your other income so if your £50k gain takes you into 40% bracket you will pay 28% on the portion over that level. You can offset gains against losses, but using your gain to reinvest again does not remove the liability for CGT. CGT from a house sale must now be paid within 30 days of the sale. Any difference between tax de & tax paid will be sorted out at the end of the tax year.
  9. There was a big rise in LHA rates at the beginning of the pandemic but I don't think there is any chance of a cut. Freezing them is about as tight as Rishi can get and freezing them in 'cash terms' means rising with inflation.
  10. You need a commercial surveyor who will value property for you and advise on rent. Then you will need a solicitor to draw up contracts - all quite different to residential (and expensive). We inherited some commercial property and are on a pretty steep learning curve with it. Good luck
  11. I have used Polyfilla previously and watched the cracks reappear because there is some movement. Caulk is flexible so I guess it depends on the circumstance of the crack.
  12. Hairline cracks are probably just cracks in the plaster. Get some decorators caulk and fill with that. Bigger and growing cracks are more worrisome and need watching.
  13. If you want to make money you need to invest time and effort - whether property or stocks and shares. Hence the saying 'the harder I work the luckier I get'. I really don't believe in the 'buy and forget about it' strategy. I actively manage my properties and my investments. Profit taking and reinvesting in dips in the market is no different to remortgaging and buying another property. When markets crashed last spring I sold early, bought near the bottom and benefited from all the subsequent growth - yes it was a bit hairy but my goodness it was worthwhile! A bit like buying a run down pr
  14. Depends on what 'bad' means, but can certainly be used as a negotiating tool for a price reduction.
  15. Buying a house to live in and adding value to it whilst you are there is a good way to get a deposit for a BTL because there is so much less tax to pay. Even if you were not intending to flip I would always advise trying to buy a house that you can add value to. Living in a building site is really unpleasant and probably not to be recommended with a baby, so I would suggest you lay down some ground rules with your partner. The biggest problem is likely to be that after working at his full time job he will have less energy & time for your home and then jobs drag on. It is also much har
  16. Clearly if a property becomes empty you can re-let at the new price, but with existing tenants you will need to raise the rent gradually over several years, I would suggest £25 per year. I would write to the tenants saying that the rents are significantly below market rent so you will be increasing rents gradually over the next few years to bring them in line with the current market. With a tenant who has been in situ for a number of years I would suggest that rates remain a little below the market rate as there is a significant benefit in long term tenants. Going forward, I always consid
  17. As above - you do not need planning for those things but you may well need your freeholder's permission & you may need to pay. New plumbing may need building control (depends what you are doing) and your boiler will need to be registered with the Local Authority (usually through the Competent Persons Scheme) so make sure you get that from your installer.
  18. By being a little more adventurous you can improve on the S&S returns. Look at Fundsmith / Scottish Mortgage IT / L&G US tracker / L&G Global Tech / Lindsell Train Global Equity / Monks IT for investments that have really returned above average returns over the last year.
  19. Sounds like a plan! You will find out how good your plan is when you buy your first properties. I have usually found that I make no money in the first year after purchase - once you have bought a property and refurbished it (even just a. light one) paid the utilities & mortgage whilst empty, letting fees etc most of your income is used up, so you may need to spread out your purchases a little more so you are not taking on too much debt all at once. I would get your first 2 up and running then take stock and see how it is working. Then rejig your plan if necessary. Good luck
  20. I agree with your mortgage adviser - if its your main home you are entitled to a residential mortgage & if you choose to rent somewhere else as well that is fine. What your Mum gives to you I would suggest is a 'gift' out of income on a regular basis. Then it is not taxable as regards HMRC & is also out of her estate in terms of IHT planning. Similarly, I would suggest your sister either gives you money towards bills or groceries etc. HMRC will not care - you are just a family living together & helping each other out.
  21. Buying with a mortgage is a better use of money - if you buy house for £100 using £20k deposit & £80k mortgage and then sell for £120k your £20k has doubled (100% increase) - minus mortgage costs (offsettable against tax at 20%). If you can use your £80k to make more than the mortgage rate you win hands down. If you used £120k cash then your £120k has made £20k (16% increase). This is called gearing.
  22. If you were going to live in the second property it would be a residential mortgage but you would need permission to rent out your existing property and might at some point need to switch to a BTL You would pay the 3% second property SDLT. The mortgage does not affect any of this (except in an affordability check) - all you are doing is giving up any gearing you have. From a purely numbers position you are better to have a mortgage & use your money to make money elsewhere but there are other factors at play such as your level of acceptable risk. Good luck
  23. You need a full structural survey and to never want to sell! The underpinning may have secured the property but it will always be a problem for a future buyer & for insurance. If it is your 'forever home' and the structural survey says its ok then get a HUGE discount - otherwise don't touch with a barge pole - all the flags you are seeing will be raised if you try to sell. Good Luck
  24. If, like me, you believe EPCs are inaccurate and the raising the requirement for all rentals to achieve a C is impossible and unfair please sign my petition and forward it to anyone else who might sign it. The requirement for all properties to achieve a C (going through consultation now) will leave many properties, especially those with electric heating, unable to be rented out and could devastate the PRS. I appreciate the need for energy efficiency, but the inability of the EPC to recognise the efficiency of modern electric radiators run on green electricity whilst favouring GCH which th
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