This month has seen some new tax changes come into effect and they could make…
While the fundamentals of the UK buy-to-let market are still strong, with all the changes in it over recent times, it’s little wonder that some landlords are either exiting the market or reducing their portfolios. The good news for these landlords is that the strength of the UK housing market means that there are still plenty of buyers out there. Here, therefore, is a brief guide to disposing of an investment property.
Decide whether or not to wait until the property is empty
The main advantage of leaving a sale until a property is empty is that you have full control over the state it is in when it is viewed. While the average rental contract will give the landlord the right to enter the property to conduct viewings (or have an estate agent do so on their behalf), there is basically nothing a landlord can do to oblige tenants to keep a property in “showroom” condition.
That being so, even the best tenants may well decide that they have better ways to spend their time than keeping their home pristine to impress viewers whom they may not want in their home anyway. Investors may be prepared to ignore this, but future owner-occupiers may not. Those interested in residential buy to let properties for sale may also have concerns about committing their money before it is absolutely certain that the tenants will vacate the property voluntarily, leaving it in good order. The disadvantage of leaving a sale until a property is empty is, of course, that the landlord is left without an income from it during the sales process.
Choose the best sales channel for you
Traditional estate agents
Traditional high street agents generally offer a full service, organizing everything from the initial marketing and viewings to exchange and completion. They tend to charge the highest fees and whether or not they’re worth it depends on a variety of factors including the quality of the service they give in exchange.
Online estate agents
With online estate agents, landlords are expected to do more of the work themselves, such as taking pictures and conducting viewings (although some online services will offer “add on” services such as these for an extra fee). The flip side to this is that they generally charge a lower fee.
This is a bit of a catch-all heading which covers everything from companies which buy houses for cash (at massive discounts) to auction sales to services which focus on investor-to-investor sales, but may also be able to reach the residential market.
Remember the importance of administration
It may seem tedious but having a good conveyancing solicitor on side can help make a sales process run much more smoothly and therefore quickly. Likewise it can also be worthwhile to have a talk with your accountant to see what advice they can give regarding minimizing tax liability (capital gains tax can take quite a bite out of sales profits) and on how best to use the profit you have made, again keeping tax considerations in mind.
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