Straightforward Guide To Letting Property For Profit

Sean Andrews

Description

This latest Revised edition of Letting Property for Profit is written against the backdrop of a falling housing market, but also rising rents as buyers find it difficult to obtain finance. It will be particularly suited to new entrants to the buy-to-let investment market, providing a detailed analysis of the current situation and the availability of capital plus legal considerations and tax advice.

Sujets

• Droit et juridique
• Inglaterra
• Personal finance
• Property law
• Law
• Wales
• England

Informations

• Publié par: Straightforward Publishing
• Date de parution: 08 avril 2013
• Nombre de lectures: 0
• EAN13: 9781847163899
• Langue: English

Extrait

LETTING PROPERTY FOR PROFIT
SEAN ANDREWS



S TRAIGHTFORWARDCO.CO.UK
Straightforward Guides
Straightforward Publishing 2013
All rights reserved. No part of this publication may be reproduced in a retrieval system or transmitted by any means, electronic or mechanical, photocopying or otherwise, without the prior permission of the copyright holders.
978184716163424
Printed by Berforts Press
Cover design by Bookworks Islington
Whilst every effort has been made to ensure that the information contained within this book is correct at the time of going to press, the author and publisher can take no responsibility for errors or omissions contained within.
C ONTENTS
Letting Property For Profit
Introduction
1. Renting out property
Investing in property during a recession
The importance of having a clear business plan
What kind of property is suitable for letting?
The business plan
Main points from chapter one
2. Buying a house or flat for investment
Your budget
Deposits
Mortgages
Building a portfolio
Stamp duty
Capital gains tax
Energy Performance Certificates
Structural surveys
Mortgage arrangement fees
Main points from chapter two
3. Looking for a property
Area
Choosing your property
Purchasing a flat
Leasehold Reform Act 1993
Viewing properties
Buying a listed building
Buildings in conservation areas
Buying a new house
Building guarantees
Main points from chapter three
4. The process of buying a property
Making an offer
Exchange of contracts
Completing a sale
Buying a property at an auction
Preparing for auction
Buying before auction
At the auction
Sale by tender
Main points from chapter four
5. Finding a tenant
Letting agents
Advertisements
The public sector
Company lets
Short lets
Student lets
The DSS and housing benefit
Holiday lets
Bedsits
Showing the property to the tenant
Deposits
Rental guarantees
Main points from chapter five
6. What should be provided under the tenancy
Furniture
Services
Insurance
At the end of the tenancy
Main points from chapter six
7. The law in a nutshell
Explaining the law
The freehold and the lease
Freehold
Leasehold
The position of the tenant
The tenancy agreement
The contract
The responsibility of the landlord to provide a rent book
Overcrowding
Different types of tenancy agreement
The assured tenancy agreement
Other types of agreement
Main points from chapter seven
8. Assured tenants
The assured tenant
The assured shorthold tenancy
Getting possession of your property before the end of the tenancy
Tenancy running on after fixed term
Evicting AST s
Grounds for possession of a tenancy
Fast track possession
Raising rent
Main points from chapter eight
9. Joint tenancies
Joint tenants: The position of two or more people on a tenancy
Main points from chapter nine
10. Rent
The payment of rent and other financial matters
The assured tenant
Rent control for assured shorthold tenants
Council tax and the tenant
Who has to pay the council tax?
Service charges
Payment of HB direct
HB and possession for arrears of rent
Main points from chapter ten
11. The right to quiet enjoyment of a home
Eviction-what can be done against unlawful harassment of a tenant
What can be done against unlawful eviction
The injunction
Damages
Main points from chapter eleven
12. Repairs and improvements
Repairs and improvements generally
Examples of repairs a landlord is responsible for
Reporting repairs to a landlord
Tenants rights whilst repairs are being carried out
Repairs and rent
Tenants rights to make improvements to a property
Disabled tenants
Shared housing
Safety generally for landlords-the regulations
Renovation grants
Main points from chapter twelve
13. Regaining possession of a property
Fast-track possession
Going to Court
Main points from chapter thirteen
14. Private tenancies in Scotland
Different types of tenancy
Protected tenancies
Grounds for possession
Fair rent system
Statutory tenancies
Assured tenants
Short assured tenancies
Recovery of possession
Main points from chapter fifteen
15. Income tax and financial management
Income tax and property-allowable expenses
Non-allowable expenses
Furnished residential lettings
Furnished holiday lettings
All letting properties
How much capital allowance can you claim?
Which year do expenses apply to?
Losses
Working out tax payable
Reporting profits to HMRC
How much tax is paid?
Capital gains tax
Tax on furnished holiday lettings
Working out taxable profits
Main points from chapter eleven
16. Advice for tenants
Guarantees
Useful websites
Glossary of terms
Index
Appendix 1 Sample tenancy agreements and notices
I NTRODUCTION
Letting property
This revised edition of Letting Property for Profit has been expanded to cover buying property during a recession. Its aim is to demonstrate in a clear and uncomplicated way the key elements in buying and managing residential property. In the main the book is intended for the investor but can also be used by those who wish to gain a background in property management generally.
Although it is harder for the would be landlord to gain access to the buy-to-let sector at this point in time, the opportunities for landlords to invest and make a decent return are better than ever, with rents across Britain set to rise by more than 20% over the next five years and more and more individuals and families moving into the private rented sector. Overall, private letting of residential property has grown significantly in the last 25 years, particularly with the passage of the 1988 Housing Act which gave landlords more incentive to let. However, in some cases those who are involved in letting property do not have the professional knowledge needed to manage effectively and often end up in a mess. Little thought is given to the fact that a complex framework of law, which both parties should recognise, covers the landlord and tenant, defining the relationship between the two.
Whilst the public sector has taken great pains to educate the landlord and tenant, the private sector has not followed suit. This book should, hopefully remedy some of those shortcomings and make the process of managing property for a profit that much easier.
Generally the key to understanding any situation is having knowledge of a particular subject. The law and business environment relating to housing is one very important area.
This Guide is intended to provide clear answers for the landlord, existing or potential by outlining the business and legal environment and also rights and obligations in general and by pointing to the way forward in a particular situation. The book covers the acquisition, letting and managing of property in depth and should enable the landlord, or potential landlord to manage effectively and efficiently, at the same time protecting his or her asset.
Also included in this revised edition is an updated detailed guide to landlord tax obligations, including capital gains tax and advice on how to minimize liability.
The guide should also be of use to the student who wants a brief introduction to the law relating to private residential lettings.
This book is essential reading for any landlord or potential landlord and should prove to be invaluable.
Sean Andrews
1
CONSIDERATIONS WHEN RENTING OUT A PROPERTY

Investing in Property During a Recession
Demand for property investment has remained strong during this current recession, indeed, the overall demand for private rented property is stronger than ever, with the mortgage market restricted for purchasers and house price inflation, particularly in the south east, creating the need for high deposits which people cannot find. Lending has become far more stringent, owing to the onset of the credit crunch and the banks unwillingness to loan money, particularly to property investors. Essentially, accessing finance has become a big issue. The banks favor those with large cash deposits. This is the same in the buy-to-let sector as for domestic mortgages.
However, if finance can be arranged then the yields that one can expect from buy-to-let properties are high by comparison, currently standing at 6%. A yield is a portfolio s annual rental income as a percentage of total value. The reason is that demand for private rented property is high, particularly as first time buyers cannot get a toehold in the market. They are instead turning to the private rental sector. Therefore, investing in property, for the longer term, as opposed to investing for short-term gain, is still a viable option.
As with everything, property is a good investment as long as it is managed well. Too many landlords (so called landlords) buy property and neglect it which has a negative impact on the environment and also a negative impact on the investment as a whole. A run down property will decrease in value and the possibility of renting it out for a full market rent will also diminish. That is what this book is all about-how to become a good landlord and a good property manager and how to maximize the returns on your property.
The importance of having a clear business plan
Letting residential property for profit has become more and more common in the last twenty years, particularly since the passage of the 1988 Housing Act, which gave potential landlords more incentive to let by removing rent controls for property let after 1988 and also changing the tenancy in use to the assured tenancy, a version of which is the assured shorthold, fixed for a minimum period of six months and easily ended after that period.
Added to the passage of the 1988 Act has been the activities of the housing market which boomed in the eighties and then predictably went bust, boomed again in the nineties and then went bust and then b