Landlord Tax on holiday lets

As per the new regulations, there are additional taxes on buy to let properties.

They hit landlords heavily because many items are no longer tax-deductible. Also, the reduction in tax breaks as it is making traditional buy to let less attractive.

Landlords who have recently completed their tax returns must have started to feel the changes. Additionally, this will be more apparent in the future as the full impact of the mortgage interest tax relief comes into place. Taxes are going to be heavier in comparison for higher income earners.

You can act and avoid the implications of this punitive tax by diversifying your portfolio with holiday rental investments.

To convert an existing property into a holiday let, you need to completely redecorate it and furnish it to a standard expected of a holiday apartment. Read more: Bills included rent

Many hands-on investors are thrilled by this news and have been converting some suitable properties within their portfolio to holiday lets. However, not all landlords may benefit from having properties located along the coast or in busy tourist cities. Assured Shorthold Tenancy

Don’t let the idea of short-term lets, managing to advertise through Airbnb and the frequent cleaning dissuade you. In fact, the good news is that some holiday rental properties are available to purchase within a resort with on-site activities and watersports which will increase occupancy and come fully managed.  What is rent to rent

Capital allowances are available on furnished holiday lets.

This means that investors can possibly maximise their income. Instead, this is unavailable for traditional buy to let properties. Also, there is also mortgage interest tax relief that is applicable. This means that investors will virtually pay no tax for the first four years of the investment.

For example, someone who invests in a £225,000 furnished holiday let can claim £63,113 in capital allowance. What happens at the end of a tenancy

Other benefits include the unit being fully managed.

This means that investors will not have to worry about finding occupants and managing letting the holiday home in due course.

What is West London Property Networking?

If you have any questions on property management, please contact Pelin Martin to book a 30-minute free consultation on +0208 994 7327 – pm@bluecrystallondon.co.uk

How do mortgage lenders calculate affordability

Some lenders may tell you that they won’t offer you a mortgage because your Affordability risk is too high. How to keep your property gas safe

Lenders’ Affordability rules differ depending on the landlord.

Finding a suitable mortgage match the landlord and the mortgage lender is the priority of the mortgage brokers. Bills included rent

When a lender considers your application for a mortgage, all they want to know is that they can get their money back with interest. Each lender considers risk differently so as you may be suitable for one though not suitable for another. Assured Shorthold Tenancy

Affordability is calculated through a Stress Test, which weighs up the amount you want to borrow against the income. If you have a small number of rental properties and have a decent employed income, a lender may not be interested in your rental income at all. Mortgage lenders use the information to check if you pass the stress test and calculate your affordability risk. How to find good tenants

Passing the Stress Test is the first step, the credit score is the second.

It is important to be transparent from the beginning regarding credit history because if it leads to a declined loan application, it could take 6 – 12 months before lenders regain confidence in you. What is rent to rent

  • Typically lenders start assessing portfolios with 4 or more properties, some will mark it at 7 properties and for others, portfolio size is completely irrelevant but will put a cap on the combined portfolio value. What happens at the end of a tenancy
  • The more properties you have the more equity they expect you to have across your portfolio. If you have 7 or more properties you are likely expected to have 35% equity to get a decent rate.

What is West London Property Networking?

If you have any questions on property management, please contact Pelin Martin to book a 30-minute free consultation on +0208 994 7327 – pm@bluecrystallondon.co.uk

How to check if a property is gas safe

Most landlords don’t check their gas appliances annually. So, we’ve put together a list all landlords need to know how to check if a property is gas safe.

Carbon monoxide alarms are a must in all properties where there is a solid fuel burning appliance

A property with wood burning fires and stoves requires a carbon monoxide alarm. It is a legal requirement. The law doesn’t include gas appliances though you should install carbon monoxide alarms if you have any gas appliances. These alarms cost less than £30.

Bills included Rent

Gas safety checks must be carried out annually

The government recently introduced changes to gas safety regulations.

So, you can carry out the checks in the 2 months prior to the due date, while still retaining the original expiration date. You don’t need to worry about leaving it to the last minute.

However, you need to complete these checks within 12 months of the installation of a new appliance or flue.

Assured Shorthold Tenancies

Ensure a qualified Gas Safe registered engineer completes the gas safety check

Registered engineers have been trained in gas safety and the standards needed for appliances and installations. It’s illegal to use a non-registered engineer. All engineers must carry an ID card, which you should request to see.

How to find good tenants

Keep paperwork safe

You must provide a copy of the gas safety record to your tenants within 28 days of the completion of the check. Any new tenants must receive a copy of the most recent certificate before they move in. It’s best to get an acknowledgement of receipt from the tenant with a signature for your records. Legally, you have to keep a record of the safety check for at least two years.

What is rent to rent

Register your appliances

Registering your appliance will keep you up-to-date with any product recalls or necessary safety repairs. You can also check the details of any older appliances you might have. It may also entitle you to an extended warranty.

What is West London Property Networking?

If you have any questions on property management, please contact Pelin Martin to book a 30-minute free consultation on +0208 994 7327 – pm@bluecrystallondon.co.uk