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Very true, but what makes it viable is bringing down your LTV.
Easier said than done I appreciate.
BTL is a sound investment
But it has become the highest taxed investment you can have
which ever way you jump in this game you will pay more tax
In my world I look at the net profit for effort required
I can get similar returns net for doing next to nothing
so why would I invest in UK property ie BTL
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
My accountant has recently told me that my property investment business will be paying most tax among all other investments and suggest no more BTL investment if I want to achieve my investment net return goals. Like DL said, it now attracts most tax compared to all other investment. Basically the government is still planning to cover all taxable route for property investment going in SDLT and coming out CGT (property asset is the only exception with higher tax rate).
As I always reminded myself, it is not how much many you make, it is how much money you pocket at the end of the day.
I am currently in the process of buying another BTL property with a 76% mortgage. I don't consider that either brave or stupid. I am buying it through a company.
I might become a higher rate taxpayer next year but will only pay 40% on a small part of my income.
Prices around here are going up much faster than I expected.
I do plan to try to get rid of all the mortgages in my own name next year, mostly by selling my most expensive property, a former home.
So the S24 and stamp duty is not effecting your area peter why is that do you think ?
S24 isn't affecting me much because it is designed to affect landlords with more income than I have. currently, and I am taking steps to avoid it becoming a problem when my income increases.
The stamp duty increase is annoying and has slowed the rate at which I buy.
Do you not worry about futher changes
taxation of company
i don’t see support from the tories labour for the PRS
they treat us as though we don’t even excist
who knows what willl happen and that has to be a concern
Labour's proposals for rent controls would harm the PRS but only slowly. At the worst I would sell on change of tenant.,
My company will just be topping up my income. I could live with selling it., but I don't think there will be significant extra taxation for such small companies.
Yes bad things might happen, sot I don't have all my eggs in one basket.
Do I think they're going to be a crash - YES I DO
When will the crash be - ITS ALREADY STARTED LONDON FALEN 10-15% OVER LAST 1-2 YRS
How big wil the crash be - IT WILL DEPEND HOW HIGH INTEREST RATES GO AS MORE PEOPLE ARE FORCED TO SELL DUE TO THERE CASHFLOW THEN MEDIA / SUPPLY VS DEMAND TAKE OVER. GUT FEELING IS IT WILL BE 30-35% in LONDON and SE - ANOTHER 20% MORE.
Will it affect whole of the UK - PROBABLY NOT, JUST AS LOW RATES MADE LOW YIELD LONDON AND SE MARKET GO CRAZY INCREASING THEM AT LITTLE MAKES LOSSES IN THOSE AREAS BUT NOT IN LOW VALUED / HIGH YIELD AREAS SO DONT SEE THE SAME CORRECTION OCCURING ESPECIALLY AS PRICES HAVENT RISEN MUCH IN 10 YRS.
Will I stop buying - NO BUT I WILL BE VERY CAREFUL WHAT I BUY, WHERE I BUY AND HOW MUCH I'LL PAY. IF I BUY CIRCA 30% BELOW CURRENT VALUE AND 12% YIELD AND IN A GOOD AREA (NO DSS) THEN YES I WILL CARRY ON. I WILL PROB ALSO DEVELOPE IN LONDON AND SE WITH A CONSERVATIVE 25%+ NET MARGIN IN UNDER 1YR
There's not many business's I know that are still very easy to borrow money at high LTV's and low interest rates to stretch your funds as well as being fairly easy to assess risk, do due diligence and get margin of error low (just a bit of maths with some knowledge of cost of works). Tax is a little challenging but not hugely different for BTS/Develop and high yield BTL has larger profit margins now with low interest rates and S24 than with higher interest rates and no s24 pre 2008.
regards Andrew Peers - property investor / sourcer - 07912674181
Property Redress Scheme Number 011436 NLA member 174404