Nice investment in this lovely old building

Look at this nice little one bedroom flat at the back of this historic old building in the very centre of Ludgershall being marketed by ourselves and our Salisbury office.  

These flats are very popular with tenants and always rent well.  Add to this a very long lease and a return of over 6% plus a tenant in situ its well worth considering.

http://www.rightmove.co.uk/property-for-sale/property-65829995.html

For any advice or help, please feel free to give us a call.

Preparing your investment for sale

Thinking of selling your buy to let?  This is obviously a little more difficult than selling your own home as you are not in control of how it’s presented.  Here are a few tips that may help:

Where possible, use the agent who let it, sell it.  There is a very good reason for this – the agent will have a relationship with the tenant and this is key.  The last thing you want is for the tenant to give notice the minute they hear the property is going on the market.  Make sure the agent makes the tenant aware that notice will only be given once a suitable offer is received and accepted.

Encourage the tenant to keep it tidy.  This may sound simple but, at the end of the day, the tenant has little interest in getting the property sold.  Therefore advise them that there is every possibility that the property will sell to another investor, in which case they will probably be allowed to stay on.

Ask the agent to go early to every viewing!  This will allow them time to have a quick tidy, if necessary, open curtains and air it a little.

Emphasis the rental value.  If it is a typical buy to let investment and most likely to appeal to investors, make sure it is marketed as such including the rental value.

Periodic tenancy.  If possible, don’t market the property until your tenant is on a periodic tenancy.  Two reasons for this, if they are in a fixed term tenancy it limits your market massively, secondly, if it does sell to a new owner occupier, you can serve your two months notice.

                                                         

Notice.  If the property is sold to an owner occupier, only serve notice once you have agreed a price, solicitors have been instructed and you have received notification that the survey has been booked.  The sales process typically takes anything between 8 to 12 weeks, depending on the chain so this should limit the time the property is empty.

At the end of the day, communication is key when selling a buy to let and that’s mainly the communication between the agent and the tenant.  Keep them on side and it should be a relatively painless process!

Large or medium sized semi detached - Which makes the best investment?

I was recently asked by a friend of mine if he should buy a fairly standard three bedroom semi detached house in Picket Twenty or a slightly larger version with a garage.

We did some research and found a nice, nearly new three bedroom semi detached house with garage on Turnpike Road which was marketed for £275,000 should achieve a rental value around £1150pcm giving an annual yield of 5%.

A slightly smaller three bedroom semi in the same area was recently sold for £250,000 and would attract a rental value of around £1000pcm giving an annual yield of 4.8%. 

Both properties would be popular with young families, especially with the local school growing in popularity.  However, it does show that, spending more, won’t necessarily earn you a much higher return in the long run, even with a higher monthly rental income.. 

This shows that while a property can achieve a higher rents, it does not necessarily mean higher returns.

If you would like any advice when choosing properties, you may come and see us at our offices.

How to calculate Stamp Duty Land Tax

As you are no doubt aware the calculation of Stamp Duty payable was changed a couple of years ago by the then Chancellor.  Most people had hoped that a lot of the changes would be reversed but sadly that seems unlikely and the current rules were bought in on 1^st April 2016. 

The current rules are:

A property costing up to £125,000 – no SDLT payable

The portion of the purchase price between £125,000 and £250,000 – 2% (up to £2500)

Plus the portion of the purchase price between £250,000 and £925,000 – 5% (up to £33,750)

Plus the portion of the purchase price between £925,000 and £1.5m – 10% (up to £57,500)

Plus the portion of the purchase price between £250,000 and £925,000 – 5% (up to £36,250)

Plus the portion of the purchase price over £1.5m – 12%

So buyers of a property costing eg £375,000 would pay £8,750 (£0+£2,500+£6,250). You can find an SDLT calculator at https://www.gov.uk/stamp-duty-land-tax/residential-property-rates

Sadly however, for Landlords the SDLT payable increases by a further 3% for additional properties above their own residence.