Any Landlords on Here?

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MattHall91

Member
 Cheshire
I haven't looked if this has been covered before so apologies if I'm repeating someone else.

I'm considering buying a 2nd house to start my own pension fund as I can't be doing with the work place pensions.

Just been reading the implications of letting a property under a residential mortgage (naughty). If one doesn't want to break the law, what is the best way to get into property as a business?

I am new to this - only got my own personal house at the moment.

Thanks :)
 
We've got a property we rent out, essentially it'll be for our Children to use the equity from the sale to get on the property ladder as and when, we had to put 40% deposit down and we have it managed through an agent, I forget we have it tbh, good move if you fancy it :thumbsup:
 
just get a normal mortgage if you dont currently have one, very hard if not impossible for the tax man to find out.

If you want some persuasion then look at the tax numbers from 2017 onwards, by 2020 if you are on a buy2let with a sizeable mortgage you will be making very little money. Also don't forget the captial gains tax when and if you sell.

Infact I think the flat market is going to be flooded over the next few years as a % of landlords sell up before the tax changes really hit
 
Iirc you have to earn more than £5K before tax implications kick in, just over I think, and if the mortgage is in 2 names then that's each, I may be wrong as I've had quite a lot of red wine since we took out the mortgage :-) I'm sure someone will be along soon to fill in the spaces .
 
Good advice above (Ranski) but if you do press on with the plan there is a expected deluge of BtL sellers expected when the meat comes off the bone through government changes due shortly
Should be a good time to pick one up but my advice would be if you do then look longterm on it as its unlikely to return much initially if you are borrowing the lump
 
I have a mortgage on my own property already.

Despite temptations to spend my money on something that gives happiness in the short term, I know it wouldn't be beneficial in the long run.

I wouldn't be looking to make a profit at the moment, I would be more than happy if the rent covered the mortgage payments. But obviously lenders want reassurance the property will return 125% of the mortgage payments.
 
MattHall91 said:
I have a mortgage on my own property already.

Despite temptations to spend my money on something that gives happiness in the short term, I know it wouldn't be beneficial in the long run.

I wouldn't be looking to make a profit at the moment, I would be more than happy if the rent covered the mortgage payments. But obviously lenders want reassurance the property will return 125% of the mortgage payments.
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we don't make much profit, we've not got it for that, it's a long term plan, the rent as you say needs to cover the repayments plus a little extra for the uncertainties that will occur :thumbsup:
 
Darren Slone said:
MattHall91 said:
I have a mortgage on my own property already.

Despite temptations to spend my money on something that gives happiness in the short term, I know it wouldn't be beneficial in the long run.

I wouldn't be looking to make a profit at the moment, I would be more than happy if the rent covered the mortgage payments. But obviously lenders want reassurance the property will return 125% of the mortgage payments.
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we don't make much profit, we've not got it for that, it's a long term plan, the rent as you say needs to cover the repayments plus a little extra for the uncertainties that will occur :thumbsup:
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This is all I am after too, it's just to save me paying 5% salary each month into a pension.

I guess it's just the larger deposit to get a buy to let mortgage initially. Good that you put 40% down :thumbsup:
 
Matt you have to put 40% down for a btl mortgage, or you did 5yrs ago, some could be from savings or equity from your existing property, best of luck :thumbsup:
 
Darren Slone said:
Matt you have to put 40% down for a btl mortgage, or you did 5yrs ago, some could be from savings or equity from your existing property, best of luck :thumbsup:
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I think some lenders will accept 25-30% now, but with less favourable rates.

Cheers Darren, I think it's the way to go.
 
With the new rules coming in whereby you pay tax on all of the rent and not just the profit, I can see student rents becoming more popular...
ie A 4 bed property. 3 bedrooms filled paid through the books and subject to tax, 1 bedroom filled and through the back pocket.

-You obviously wouldnt catch me doing this. :|
 
The new tax rules will certainly make Buy to let less profitable, as a Business wrt your average 3 bed semi. Don't forget from the next tax year there's more stamp duty to pay too. As an investment it's still a very good return with interest rates on savings more or less worthless at the moment.
 
You can buy a BTL property with as little as 15% deposit in England (20% in Scotland). Depending on your game plan, you need to consider whether to buy it either personally, or through a Limited Liability Partnership (LLP) or through a Limited Company. If you complete after 1st April you will have to pay an extra 3% stamp duty on purchases above £40K on ANY second property you either own singly or jointly. So even if you end up buying jointly to help the kids onto the property ladder, if you already own your own home, you will have to pay the extra 3% stamp duty on the purchase price.

The market will be flooded by many landlords offloading their BTL's which will see a slump in prices in the First time buyer end of the market with the subsequent knock-on effect up the chain. This will lead to a crash in prices as FTB's will still not be able to buy property as the issue is not so much with the availability of property but the fact that people rent mainly because they do not have the deposit to buy. Young people are mainly not in a position to buy as they have been sold a lie in that a university degree is the Holy Grail, even if it is in underwater basket weaving, and have come out of Uni. indebted up to the eyeballs owing thousands and receiving minimum wage stacking shelves in Tescos. Now to add insult to injury if their parents want to help them to buy, by joining them on their mortgage, they'll need to find an extra 3%. Thanks George, you didn't think that one through very well did you? Dickhead.
 
Geezah said:
You can buy a BTL property with as little as 15% deposit in England (20% in Scotland). Depending on your game plan, you need to consider whether to buy it either personally, or through a Limited Liability Partnership (LLP) or through a Limited Company. If you complete after 1st April you will have to pay an extra 3% stamp duty on purchases above £40K on ANY second property you either own singly or jointly. So even if you end up buying jointly to help the kids onto the property ladder, if you already own your own home, you will have to pay the extra 3% stamp duty on the purchase price.

The market will be flooded by many landlords offloading their BTL's which will see a slump in prices in the First time buyer end of the market with the subsequent knock-on effect up the chain. This will lead to a crash in prices as FTB's will still not be able to buy property as the issue is not so much with the availability of property but the fact that people rent mainly because they do not have the deposit to buy. Young people are mainly not in a position to buy as they have been sold a lie in that a university degree is the Holy Grail, even if it is in underwater basket weaving, and have come out of Uni. indebted up to the eyeballs owing thousands and receiving minimum wage stacking shelves in Tescos. Now to add insult to injury if their parents want to help them to buy, by joining them on their mortgage, they'll need to find an extra 3%. Thanks George, you didn't think that one through very well did you? Dickhead.
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What a pisstake. Interesting to see how it effects house prices then.
 
Very interesting Geezah, sorry to threadjack but do you or anyone else know anywhere I can get the information to set up a limited company specifically for this purpose?

My brother and I have a property rented out that we purchased outright, my parents have 3 which are mortgaged / owned and rented and my wife has one with her brother and one with her cousins etc.

All of these are likely incurring 40% tax and possibly more and I was thinking about setting up a company to offset the tax and apply some costs against it like renovation, maintenance, one of our cars etc.
 
No worries Bluestreak, PM me and we can talk in private if you want. There is no 'one size fits all' solution I'm afraid.
 
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