Full Timers who rent their house (1 Viewer)

[Chris172]

Are there any FT's that own a house here in the UK and rent it?

Just wondering what is needed in regards to insurance, certificates etc..

Almost got the OH on board to FT while we rent our house until the state pension kicks in.

Our son lives in Jimena southern Spain and we have a flat near Alicante so plenty of options what to do and stay

 

[Popeye]

@Armytwowheels would advise if you correspond with them, I'm in a similar position but can't stand the thought of some one else living in my house so I'm doing the next best thing which is get a paying house sitter in part of my home.

 

[Chris172]

Got no intensions of living with them... they have 3 kids, a dog,a cat, budgie and rabbit.
Theres a camp site about 1km from them thats really cheap.... would only stay down there a couple of weeks at a time and the then tour for a while and then move back up to our flat for a couple of months

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[Paul an Jane MK]

Hi,

Would strongly suggest you find a reputable lettings agent, ours keep 10% and put the rest in our account but worth every penny.

Proper rental agreement and deposit, chase up rent for us, organise any repairs and we only get a bill if something pretty big and do regular inspections.

You will need landlord insurance to cover the building, gas and electric safety checks, a silly energy certificate thingy, smoke detector and carbon monoxide detector (if you have gas in the house and finally a legionella risk assessment.

There won't be much left from first months rent but if your main residence I Believe any income is tax free for up to two years.

Finally if you have a mortgage it probably excludes renting so you would need to decide whether to ask permission or keep quiet but hopefully if no mortgage you are sorted and have an awesome time on your travels.

Paul

 

[Theonlysue]

You will have to declare rent received as income. I believe that the letting agents have to report it from their side as well.

 

[Badknee]

We let ours to our son and his partner, much easier option.

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[Minxy]

You do indeed have to declare the rental income and do a tax return each year even if you don't get enough to pay tax on it still has to be done but its not difficult once you've got the basics sorted, as already mentioned the agents have to inform the tax office anyway so you can't hide the income as some people used to. You need to bear in mind that tenants are not likely to look after your home as you do so make sure that you are willing to accept that and weigh up the cost of repairs/redecorating etc once the tenants move out and you want you rhome back.

If you have a mortgage you will be able to offset some of the interest against your tax allowance (not capital repayments though) but this is reducing from next year so the allowance you'll get will only be 75% of the interest, then 50% and 25% for sugsequent years until there's none at all.

You do have to tell your mortgage company and I certainly would NOT advice 'hiding' it from them, same with insurance as they will probably increase your premium or cancel your policy if they don't do 'lettings' insurance.

If you get good agents (not that easy!) then it could work out well for you as they'll keep an eye on the tenants and make sure the rent comes in on time, if not you can have all sorts of problems ... been there and got several t-shirts (3 agents!) and personally wouldn't touch one again, but as you'll be out of the country you won't really have much choice - also some agents charge a premium for you being an 'absentee' landlord.

 

[Chris172]

Thanks for all the feedback. It's all as much as I expected re gas and electricity certificates etc..
We have found an agent with a highly sort after reputation that guarantees the tenant is a 'professional' and vets them thoroughly and therefore likely to look after the place. I know it can be a lottery, indeed our neighbour is one of their tenants and if they are all like them, a solicitor and an accountant, we should have no problems. Looking at £950/m so hopefully the monthly rental figure would sift the riff raff.
No mortgage involved and our income from a couple of personal pensions each and rental would be less than the combined £22k tax threshold and with our nephew being a chartered accountant thats another tick in the box on the tax returns, he already does mine as i'm self employed and he does my accounts too. Once the state pensions kick in when we are 66 thats a different matter but the idea then is to return to the house... perhaps. After 6 years or so it would need decorating anyway so we would treat it as a blank canvas.
We have just had enough of the rat race and the wife is fuming that the retirement age has shifted as she should have retired January next year. We have just had an inheritance so looking to utilise that to 'jump off' while we are still healthy and can enjoy ourselves before it's too late. We just had the last 3 years full of family tragedies and TBH we are exhausted and it all brings things down to earth and it's not all about the money.

 

[Minxy]

Don't forget to include any interest on savings you have against your tax although now there's the £1000 taxless amount hopefully that would still mean you wouldn't be affected.

Better invite your 'tame accountant' over for tea & a natter!

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[Kim H]

@Nigel&Debbie could offer you guidance on this.

 

[Nigel&Debbie]

Cant add much other than what has been said already.

The best advice is get a good Letting Agent, and as a general rule avoid the big boys. Look for a family run business, as they are the ones who actually look after your property. The big boys promise the world, take the money, and generally fail to deliver when needed.

Otherwise, good luck and go for it - you wont regret it.

 

[mojo]

You can be subject to CGT when you one day sell the property .You claim private residence relief (PRR) for the time you lived in it + the last 18 months of ownership.Then claim Letting relief to a max of £40,000 and then your CGT allowance for the year you sell.After all that you may have some tax to pay.Ask a accountant

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[JJ]

I am fairly sure that not all people who find rent of £950 a month too expensive are "riff raff", just as I am fairly sure that some who can are...

Good luck with your plans.

JJ

 

[jtp890]

JJ is spot on worst tenants in 30 years operating are doctors

 

[Minxy]

JJ is spot on worst tenants in 30 years operating are doctors

I like the 'unintentional' appropriate wording there!

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[jtp890]

unintentional ?

 

[WillH]

Gave up letting houses after too many problems, even through an agency. Sold up and invested the cash and using drawdown as part of my pension income.

 

[aztecannie]

There are good agents out there - who offer a non insurance based rent guarantee. I you are interested private email me.

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[scotjimland]

There are good agents out there - who offer a non insurance based rent guarantee. I you are interested private email me.

why not share with the forum ?

 

[aztecannie]

Not sure whether we are allowed to promote businesses on here?

 

[obanvanman]

JJ is spot on worst tenants in 30 years operating are doctors

We had a holiday home on the Isle of Mull. Our first holiday let was to a husband and wife who were both Doctors.
They trashed the place.
Friends of mine operate a holiday letting business, they ask people their professions when enquiries are made.
They then let the owners decide if they want Doctors in there. They recommend against!
Just sayin'

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[mitzimad]

the problem in london is it doesnt matter how high the rent is if they dont intend paying it

 

[Silver-Fox]

the problem in london is it doesnt matter how high the rent is if they dont intend paying it

Not just London

I used to maintenance for a landlady who had a mix of flats and bedsits.
Not high end but never people on benefits. If the tenants couldn't or wouldn't pay to get them out she used to write off the debt to get them out as it was cheaper.

Not trying to paint a bad picture but some people treat other peoples property in a terrible way.

My advice would be to try and get someone in the legal profession, police, civil service or overseas armed forces.

Good luck with your decision

 

[glastry]

Thanks for all the feedback. It's all as much as I expected re gas and electricity certificates etc..
We have found an agent with a highly sort after reputation that guarantees the tenant is a 'professional' and vets them thoroughly and therefore likely to look after the place. I know it can be a lottery, indeed our neighbour is one of their tenants and if they are all like them, a solicitor and an accountant, we should have no problems. Looking at £950/m so hopefully the monthly rental figure would sift the riff raff.
No mortgage involved and our income from a couple of personal pensions each and rental would be less than the combined £22k tax threshold and with our nephew being a chartered accountant thats another tick in the box on the tax returns, he already does mine as i'm self employed and he does my accounts too. Once the state pensions kick in when we are 66 thats a different matter but the idea then is to return to the house... perhaps. After 6 years or so it would need decorating anyway so we would treat it as a blank canvas.
We have just had enough of the rat race and the wife is fuming that the retirement age has shifted as she should have retired January next year. We have just had an inheritance so looking to utilise that to 'jump off' while we are still healthy and can enjoy ourselves before it's too late. We just had the last 3 years full of family tragedies and TBH we are exhausted and it all brings things down to earth and it's not all about the money.[/QUOT

my heart goes out to you,dreadfully similar circumstances,go- go while you can,once you do it you will realize that you are not alone.So many of us hesitate,and then the moment has gone.
Use a good letting agent,and book the ferry!
you only really regret what you have not done.

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[CWH]

"So many of us hesitate,and then the moment has gone.
Use a good letting agent,and book the ferry!
you only really regret what you have not done."

I absolutely agree with @glastry - if you want to do it, and if you can afford it, do it now. You have no idea what may be lurking around the corner.

 

[Chris]

I have come across some appalling letting agents as well, I should add.

They often completely screw up the service of notice.

When I say "often" I mean in my experience 60% of the time.

Screw up the notice and your proceedings for possession are likewise screwed up.

 

[Kev Dub]

We are contemplating renting our house as fortunately we have no mortgage. The thing that's putting us off though is our son has rented two houses in the past and both tenants left the properties completely wrecked and owing massive backlogs of rent. Rent of which he was told he has no chance of getting back.

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[xulih]

Cant add much thats not been covered other than there is more options for TAX relief on furnished property/holiday lets than non furnished. Not sure about the legionella risk assessment, bit of a grey area as far as I can make out with companies making it out to be a compulsory and complicated thing and charging a fortune for the privilege. I had a doctor tenant from Poland for 18 months and you wouldnt have known anyone had stayed in the house but as said tenants are a hit or miss, I have been lucky and not had a bad one in 6 years.