Great Video! The only thing which isn't a one size fits all is the buying in a LTD company. Generally interest rates payments can be higher and if you are only going to own one property say in London it might not be worth it. You really need to crunch the numbers taking in your income tax level, considering accountancy fees etc.
Great video Ranjan I have been thinking over last couple of months regarding what you have just discussed and it has made the decision making process easier 👍
Hi Ranjan, great content you have been pumping out over the years. I have watched your vids when you had less than 5k subs and it’s now well recognised within the TH-cam industry. Well done persistence definitely pays off. What % would you estimate for down valuations for 2021? Cheers
Thank you Ranjan for the content in this video! Just wondering if you could kindly cover one of your advices in a bit more details: ''learn all the rules & regulations'' - what are the rules & regulations a BTL beginner should be looking out for? Thanks.
Surely this method only works if you buy the property for cash. If not, bridging finance will be required with high rates / legal fees etc. Then, in-turn, a BTL mortgage can be sorted out on the uplifted post-refurb value. If you buy with a BTL from that start you can’t refinance within 6 months. Furthermore, a significant ERC will be payable. What are you thoughts on the most effective way forwards. Thank you
Bank rate 0.1%. UK 50 year gilts paying 0.72% - no future for keeping money in the bank, if you can buy a doer upper and rent it out make 4/5/6% then doing alot better than the bank.
Thanks for another really topical video. Even though I’ve watched several you’re not predictable. I particularly value the negative sides you mention as so many only emphasise the positives, which is delusional.
Thanks Ranjan. You've confirmed exactly the conclusion I've come to, i.e. I have a fully paid for rental property in my name and I'm a high rate tax payer... so getting squeezed in the tax. I'm just in two mind about the best approach, take the CGT hit now and put the house into an SPV/Ltd Co, or sell it and buy a couple of BMV properties (easier said than done on the last part)
Hi Ranjan, I am new on yours channel and now watching yours informative Videos and learning more about properties. I have a question, when you say for BRRRR no money down is that mean that we don't need to put a Deposite or we do 25% of the Value of the property Price? Thanks Rani
Hi Ranjan, thanks very much for the informative youtube videos. Are you saying new investors should buy 10-12 residential properties under the BRRRR method, then develeverage from 75% to say 50% before starting on commercial to residential ?
No.BRRRR is also a commercial to residential strategy. Right now, achieving the best value uplift from 'R - Renovate' is achieved form commercial to residential conversion.
Ranjan, great video. If you was starting fresh and had £100,000 in the bank, what would you do to maximise cashflow? Without having money becoming tied up in the asset(s). Assuming BRRR method only really works with bridging loans which are expensive
Hi Raj Great video 👍👍. I have a property with significant equity in it. I need money to sort out some personal matters. I have two options (based on my credit report and other ancillary reasons): 1. Option 1: Sell my existing property, use part of the equity to buy a smaller property and then use the remainder to sort out the other financial matters I have. I may be mortgage-free if I go for this option but I dread the process of selling the existing property. Also, I have some sentimental attachment to this property. 2. Option 2: put the existing property on LET TO BUY, refinance and buy a smaller residential property and then use some of the remaining money to sort out my financial matters. Which option would you I go for?
If you want to keep your present house I would let it out especially if its short term problem. If you sell later on though there will be tax to pay on the profits proportional to the time you rented it out.( if you tell the taxman that is lol ). Choose tenants wisely because this is where you can really come unstuck, if they don't pay rent for 10 months and you csnt get them out how will that be for your finances.
I think many people underestimate how difficult it is to draw money out of the property ( unless you bought it very BMV !!) with all the new rules coming in as a result of the changes brought about under the PRA in 2017. Trying to get the rent calculations to work to release equity is very hard in a lot of cases. Its often not a simple process. The government has attacked and continues to attack BTL including asking the PRS in many cases to fill the gap in social housing by housing tenants for free during covid ??? This will put a number of BTL landlords out of business. I've just started listening to Ranjan he is often a voice of educated reason but, people need to understand drawing money out is often like hunting unicorns !!
Hi Ranjan, Absolutely love the videos. You truly are an oracle and inspiration for property investors! Is it more profitable to exploit permitted development rights for commercial or residential properties? Additionally, what is the best strategy for a 21-year-old budding property entrepreneur who has access to investors? I am fascinated by repurposing commercial property for residential use, however, I worry that it may be too challenging for a first project. Would love to hear your thoughts. Tej
Commercial to Residential PD is more profitable because you are converting lower value commercial space into much higher value residential space and can create new dwellings. Making an existing residential property bigger, without adding more separate dwellings, is less likely to be as profitable
Tej good for you, my only advice is, tread carefully, read the story of Icarus. Usually high gain is higher risk so make sure you can stomach the risk of it all going wrong. I know someone who has lost £100k on a BRRR with a bad builder “friend” and overly optimistic remortgage plan (got turned down...). Good luck
This is really helpful - keep up the good work. Be great if you could comment on the following: I am little confused about the advice around tenancies rather than properties being the determining factor for incorporation but though maybe if I describe my situation you might be able to advise - probably quite common. I have 2 properties personally held with about 20% finance on a BTL. I also have 3 properties in a Ltd as I started doing this later - overall finance on these is about 20% again so low gearing. I have a consultancy job and am able to keep my personal income out of higher rate so have been less affected by interest rate charges on the privately held properties. My questions are : Should I still consider moving/selling properties into the Ltd and should I also be refinancing to gear up in Ltd or private? Financing in the Ltd was a bit painful for the very small level of gearing I needed so I am not sure how much easier this has become - particularly with only 3 properties in the company. Any advice welcomed.
Hi I’m currently just starting out looking at options regarding financing. My mortgage broker has advised interest only to start the ball rolling - is this the better option ?? I will try and setup a LTD company aswell.
Thanks for the video. I am in a situation where I’ve moved away from my property I bought to live, renting it now for last few years after living in it in the beginning few years. I am wondering if my best course of action is to sell before next year or try and keep till retirement to differ paying high tax rate CGT? My financial situation and goals allow me to have a mortgage locked into a property but unsure if the btl on one property under personal ownership makes any sense with the ever increasing tax on revenue and CGT.
Hi Ranjan, you provide so much value! I have a question I just turned 17 and I have an after tax income of £24,000 from my businesses. I believe I will have £60,000 saved up in 1 year and a half, my plan is to buy a 50k 2 bed studio flat in the L1 postcode and use it as collateral so I can acquire 2 buy to let mortgages. These mortgages would be 10% deposits on the same type of property (2 bed studio flat, 50k, L1 postcode.) So with a 60k investment in an ideal world I would get £1250 a month in profit. Do you think this is a bad idea and should I adopt a different strategy?
Great information, have 15 properties under my name bought 20 years ago. Been told put all under ltd however will l need to sell. This will due a lot of capital gains. Please advise. Looking forward into your next well informed video, thank you.
Unless you’re already earning mega bucks, Don’t do it. Corporation tax is going up and capital gains taxes means if you sell, you’ll be hit hard. Also makes it harder to pass on to your kids.
If you are a higher rate tax payer then personal pension contributions give you a fair bit of room to avoid tax. You would have to be a higher rate tax payer and already contribute 40k into your pension each year to not have this option. In England you can effectively gross 90k before having to pay the higher rate and you can even use your pension to invest in property.
If you draw all the equity from the property, you most likely won’t have a positive cash flow. I have looked at it several times and I am not sure how it works. Any guidance? Use figures as I have checked with the banks and it doesn’t seem to work as it is discussed
Did I miss the part about risk? You mentioned refinancing and pulling out all your capital to achieve infinite return. What about the risk? Interest rate risk and your housing market exposure? Infinite risk to market downside...
I have a registered a limited company a few years ago but stopped myself from buying any extra property because of the tax changes. I now have the funds to buy a property outright will no mortgage or loans, if the plot has potential for extra houses how would you go forward
Hi Ranjan.Is it possible to pay some bills with credit card for few months to be able to raise money on current account for btl deposit ? How the lender look at this if manage to stay below 30 percent on credit card usage.Thank you
I fall into the old timer category and made three disposals this year within my Ltd company.....The company still owes me personally directors loans so i have options at the moment.I am a pretty seasoned equities investor and my current portfolio is outperforming my property cash flow at quite a high ratio. Its likely that i will continue to build the global equities portfolio over the property. Any thoughts appreciated.One other thing the structure of the equity portfolio is still quite tax attractive with the max Isa allowance of 40k per couple /capital gains allowance roughly 24k per couple and tax allowance within the SIPP.
Hi mate, me and my business partner are trying to get started investing In properties. We have called many brokerages and they are denying us due to our age, we are 18 and have enough to put a 25% deposit down with a guarantor who owns 17 buy to let properties. Have you got any tips? Thanks.
Hi Ranjan, under how to start in property. How to evaluate accurately a property before buying it, post refurbishment, and sale price (buy to flip strategy). It seems to be a lot of discrepancy between agents, sourcers and platforms (property data, nimbus...) thanks for your help and guidance. Salim
Hey Ranjan, GREAT VIDEO and just to prove that I was hanging on to your every word, at about 15:58 mins, you make your predictions for "2121" - I guess that's an example of "Extreme Forecasting" or am I being facetious ? (BTW - did you know that "facetious" is one of only a few words in the English language with all the vowels in alphabetical order?) Anyway, I'm looking forward to when The Baker Street Property Meets start again, so that I can be annoying in person :)
The problem with the brewer method is that it relies on lenders lending....what happens when lending dries up? In addition, there are age limits on BTL mortgages, so what advise do you have for say a 70 year old who wants to refinance his BTL portfolio but can only get a mortgage for 15 years due to the lender having an age limit of 85?
Hi. I am looking at purchasing my first buy to let property and looking for some advice. I am currently a freelance CAD Designer and have my own limited company. Can I purchase a property via my limited company or do I need to open a new company specific to purchasing property?
I am currently a higher rate tax payer and looking at setting up a company and purchasing a property in the Midlands with a fellow owner in the company. The other owner is also a higher rate tax payer. We do not foresee leaving our jobs but the plan would be to actively grow the property portfolio for passive income - it sounds like you are saying this is a myth and is not worth doing? If this is correct, why?
I think If you own property through a company it is OK. Main issue with individual landlords is paying too much tax because they are high income earner, and limited types expenses that can be tax deductible. A business would only pay flat 20% on profit, and if you have a good accountant, he can help you reduce tax to a minimum, whereas individual is not able to reduce his tax liabilities. With a company you would then pay yourself using tax efficient ways such as dividend, or give yourself benefits such as purchasing a car for “business use”, which is now an expense and tax deductible. 👍
Hi Ranjan are you aware Property Forum appears right under your videos with a big subscribe button- I accidentally subscribed to their channel thinking I was subscribing to yours
Money better off in pension or ISA invested in global fund. Tax free returns and up to 40% tax credit on pension investment. BTL returns suck in comparison when tax and costs and voids and bad tenants are factored in. Not to mention stamp duty and other fees eating away at valuable capital
I was a motivated seller recently, my tenants left it in a right state, tax changes were approaching meaning I would pay tons more tax if I sold after the deadline, property was 140 miles away and I'd had enough. I took lower than market value to get shot quickly. Finding these deals is a matter of luck and looking constantly and also having contacts with estate agents etc. Bear in mind these properties will generally need a fair amount of work.
Hi...dont think 10 properties are neccesary.....I have 3 and happy with them......pay £100 odd pounds on mortgage each,and get 1300 for each....happy medium for me as a retirement investment. I think three is enough to retire?
Think of Buying a second home for work then renting 2 rooms out. Which will pay mortgage and bills and little bit extra. Plan was to pay off mortgage then bit of a pension. I’m I gonna get stung with tax when comes to selling?
Buy 4 freehold residential properties all in the same area. Get them managed by good people. You won’t be able to retire but it should give you roughly £1500 a month cash for very little effort, once it’s all set up.
1 important question. If i currently have 2 BTL in my name(single let NOT HMO) even if i sale it how can i buy from scrtach as a compan if i need at least 6 properties (single lets as i'm not interested in HMO) its sounds impossible to me. Could you please answer. Many thanks and Merry Christmas !!!!
If you do rent out through a limited company, you get the benefit of interest relief but instead you get clobbered by the higher upfront cost of SDLT on residential property.
he doesnt address this so dont use a limited company if youre a basic tax payer. Buy in your own name until you reach the threshold. The advantages of property in your own name is when the property increases in equity, when you pull it out it goes straight into your account tax free! In a company you will pay tax to get it out.
The problem is that if you are a basic rate tax payer and you get buy to let mortgages, you will soon become a high rate tax payer. Remember your annual buy to let mortgage interest payment is added to your salary to determine your tax band
@@healthiswealth8153 depends what your ambitions are. I assume a buy to let landord will have earnings of at least 25k as that is usually the minimum required to get a mortgage. Unless you buy up north where rents are are low, if you are building a portfolio it won't take long to get to earnings of 50k. If you live and work down south, then I imagine most investors are very close to that 50K limit already. Restructuring your portfolio further down the line can be a costly business. Better to get the right structure from the outset. But again....its comes down to your goal. If its just to own a couple of properties then Id say incorporation is not for you. If its to become a professional landlord with a professional portfolio then its the only way to go.
@@jimboyuk1 yes i agree it wouldn't take long to hit £50k whatever your income but it could still be advantageous to have some in your own name if possible but in the long run if you are going to be full time in property you will need to be incorperated at some point to take advantage of being tax efficient
Buy to let for 1st time buyers it's not worth it anymore. The government will do their best to keep tight property business and make it even harder for "the middle man" class to invest in future!
So I'm a low rate tax payer with 3 buy to let's..and I still stay low tax with the buy to let's..I earn like £27000 plus about £15000 from buy to let's. If I did more buy to let's then I'd go higher tax and would be a waste if time.
But if you refinance leaving 25 percent . You still benefit instead of selling. Capital gains tax will die with you and if maximise finance you reduce INHERITANCE tax?
@@ranjanbhattacharya-succeed7617 As it is something that has just come into my realm of consciousness , then it must be the same for the Government. So annoying .
Given that the UK government is in massive debt....isn't the scrapping of section 24 an easy win for the government to raise additional tax income? I.e. BTL landlords who hold property in a ltd co are no longer allowed to offset mortgage interest against their tax liability. Assuming it is, then is incorporation even worth the hassle?
@@ChrisLee-yr7tz in my comment I have suggested that the government could easily scrap section 24 relief for limited companies so not sure what this comment or the other one is about?
@@jagsingh1979 S24 is the restriction of allowing interest as an expense for private individuals. It isn't a rule that allows interest to be expensed inside ltd co's.
What if you buy cash, rent it out, then want to refinance, but don't have any income other than the rent i.e. no job. This could happen if someone has an inheritance, or wins the lottery lol
Yes.In that video th-cam.com/video/ZG2prbw8QWo/w-d-xo.html I am talking about the direction of travel buy to let has taken over the last decade and where its heading. Whether to do buy-to-let is not a one size fits all answer for everyone. This video attempts to break down the answer in terms of where people are in their property journey
From the perspective of a young person who is looking to get onto the housing ladder BTL is a nightmare. BTL is driving up the price of housing, the government keeps saying they're building affordable housing. The reality is all affordable housing becomes BTL, making it ever harder for 1st time buyers to get a start.
It’s the government giving incentives to first time buyers that is pushing up the price of houses- house builders are hiking up their prices because demand is high! Property investors are generally bringing empty homes or property that needs a lot of work done and turning them into homes - homes are in short supply because there are not enough new homes being built.
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Great Video! The only thing which isn't a one size fits all is the buying in a LTD company. Generally interest rates payments can be higher and if you are only going to own one property say in London it might not be worth it. You really need to crunch the numbers taking in your income tax level, considering accountancy fees etc.
Great video Ranjan I have been thinking over last couple of months regarding what you have just discussed and it has made the decision making process easier 👍
Very educational Rajan, many many thanks, you STAR.
Hi Ranjan, great content you have been pumping out over the years. I have watched your vids when you had less than 5k subs and it’s now well recognised within the TH-cam industry. Well done persistence definitely pays off. What % would you estimate for down valuations for 2021?
Cheers
Thank you Ranjan for the content in this video!
Just wondering if you could kindly cover one of your advices in a bit more details: ''learn all the rules & regulations'' - what are the rules & regulations a BTL beginner should be looking out for? Thanks.
Thank you for your comment and view, trust me I don't take them for granted.💯+1//5//5//1//3//1//9//4//8//5//4
Surely this method only works if you buy the property for cash. If not, bridging finance will be required with high rates / legal fees etc. Then, in-turn, a BTL mortgage can be sorted out on the uplifted post-refurb value. If you buy with a BTL from that start you can’t refinance within 6 months. Furthermore, a significant ERC will be payable. What are you thoughts on the most effective way forwards. Thank you
Bank rate 0.1%. UK 50 year gilts paying 0.72% - no future for keeping money in the bank, if you can buy a doer upper and rent it out make 4/5/6% then doing alot better than the bank.
Thanks for another really topical video. Even though I’ve watched several you’re not predictable. I particularly value the negative sides you mention as so many only emphasise the positives, which is delusional.
Great video, could you clarify please, is it best to have a SPV in each property or to put them all in a singleLtd company?
I will be still using the btl.
Thanks Ranjan. You've confirmed exactly the conclusion I've come to, i.e. I have a fully paid for rental property in my name and I'm a high rate tax payer... so getting squeezed in the tax. I'm just in two mind about the best approach, take the CGT hit now and put the house into an SPV/Ltd Co, or sell it and buy a couple of BMV properties (easier said than done on the last part)
Hi, thanks for the update as very informative. I have 3 BTL with single tenancies but I am not HRT. So is going incorporated beneficial to me?
Hi Ranjan,
I am new on yours channel and now watching yours informative Videos and learning more about properties.
I have a question, when you say for BRRRR no money down is that mean that we don't need to put a Deposite or we do 25% of the Value of the property Price?
Thanks
Rani
One way of avoiding this tax problem is to invest in property abroad.
Very informative and motivational video Ranjan. I will surely subscribe and check out your other videos mentioned in the description box.
Hi Ranjan, thanks very much for the informative youtube videos. Are you saying new investors should buy 10-12 residential properties under the BRRRR method, then develeverage from 75% to say 50% before starting on commercial to residential ?
No.BRRRR is also a commercial to residential strategy. Right now, achieving the best value uplift from 'R - Renovate' is achieved form commercial to residential conversion.
Ranjan, great video. If you was starting fresh and had £100,000 in the bank, what would you do to maximise cashflow? Without having money becoming tied up in the asset(s). Assuming BRRR method only really works with bridging loans which are expensive
Hi Raj
Great video 👍👍. I have a property with significant equity in it. I need money to sort out some personal matters. I have two options (based on my credit report and other ancillary reasons):
1. Option 1: Sell my existing property, use part of the equity to buy a smaller property and then use the remainder to sort out the other financial matters I have. I may be mortgage-free if I go for this option but I dread the process of selling the existing property. Also, I have some sentimental attachment to this property.
2. Option 2: put the existing property on LET TO BUY, refinance and buy a smaller residential property and then use some of the remaining money to sort out my financial matters.
Which option would you I go for?
If you want to keep your present house I would let it out especially if its short term problem.
If you sell later on though there will be tax to pay on the profits proportional to the time you rented it out.( if you tell the taxman that is lol ).
Choose tenants wisely because this is where you can really come unstuck, if they don't pay rent for 10 months and you csnt get them out how will that be for your finances.
Thanks ranjan great video very honest
I think many people underestimate how difficult it is to draw money out of the property ( unless you bought it very BMV !!) with all the new rules coming in as a result of the changes brought about under the PRA in 2017. Trying to get the rent calculations to work to release equity is very hard in a lot of cases. Its often not a simple process. The government has attacked and continues to attack BTL including asking the PRS in many cases to fill the gap in social housing by housing tenants for free during covid ??? This will put a number of BTL landlords out of business. I've just started listening to Ranjan he is often a voice of educated reason but, people need to understand drawing money out is often like hunting unicorns !!
Hi Ranjan,
Absolutely love the videos. You truly are an oracle and inspiration for property investors!
Is it more profitable to exploit permitted development rights for commercial or residential properties?
Additionally, what is the best strategy for a 21-year-old budding property entrepreneur who has access to investors? I am fascinated by repurposing commercial property for residential use, however, I worry that it may be too challenging for a first project.
Would love to hear your thoughts.
Tej
Commercial to Residential PD is more profitable because you are converting lower value commercial space into much higher value residential space and can create new dwellings. Making an existing residential property bigger, without adding more separate dwellings, is less likely to be as profitable
Tej good for you, my only advice is, tread carefully, read the story of Icarus. Usually high gain is higher risk so make sure you can stomach the risk of it all going wrong. I know someone who has lost £100k on a BRRR with a bad builder “friend” and overly optimistic remortgage plan (got turned down...). Good luck
This is really helpful - keep up the good work. Be great if you could comment on the following:
I am little confused about the advice around tenancies rather than properties being the determining factor for incorporation but though maybe if I describe my situation you might be able to advise - probably quite common. I have 2 properties personally held with about 20% finance on a BTL. I also have 3 properties in a Ltd as I started doing this later - overall finance on these is about 20% again so low gearing. I have a consultancy job and am able to keep my personal income out of higher rate so have been less affected by interest rate charges on the privately held properties.
My questions are : Should I still consider moving/selling properties into the Ltd and should I also be refinancing to gear up in Ltd or private? Financing in the Ltd was a bit painful for the very small level of gearing I needed so I am not sure how much easier this has become - particularly with only 3 properties in the company. Any advice welcomed.
Hay thanks for taking the time and educating us and uploading this is very useful information made simple, thanks so much, 👋🏽✨⭐️✨✨
Hi I’m currently just starting out looking at options regarding financing. My mortgage broker has advised interest only to start the ball rolling - is this the better option ?? I will try and setup a LTD company aswell.
Thanks for the video. I am in a situation where I’ve moved away from my property I bought to live, renting it now for last few years after living in it in the beginning few years. I am wondering if my best course of action is to sell before next year or try and keep till retirement to differ paying high tax rate CGT? My financial situation and goals allow me to have a mortgage locked into a property but unsure if the btl on one property under personal ownership makes any sense with the ever increasing tax on revenue and CGT.
Hi Ranjan, you provide so much value! I have a question I just turned 17 and I have an after tax income of £24,000 from my businesses. I believe I will have £60,000 saved up in 1 year and a half, my plan is to buy a 50k 2 bed studio flat in the L1 postcode and use it as collateral so I can acquire 2 buy to let mortgages. These mortgages would be 10% deposits on the same type of property (2 bed studio flat, 50k, L1 postcode.) So with a 60k investment in an ideal world I would get £1250 a month in profit. Do you think this is a bad idea and should I adopt a different strategy?
you wont get a BTL mortgage with a 10% deposit, need 25% minimum!
@@chm5mwty for the advice. :)
Great information, have 15 properties under my name bought 20 years ago. Been told put all under ltd however will l need to sell. This will due a lot of capital gains. Please advise.
Looking forward into your next well informed video, thank you.
Yes, the gov. pulled a fast one. You’ll have to sell & re-purchase in Ltd co. so they get their tax!
What will u do when the great reset happens and they demand u give up ur property ?
@@jamesgrant3812 hi what go you mean by they
Unless you’re already earning mega bucks, Don’t do it. Corporation tax is going up and capital gains taxes means if you sell, you’ll be hit hard. Also makes it harder to pass on to your kids.
If you are a higher rate tax payer then personal pension contributions give you a fair bit of room to avoid tax. You would have to be a higher rate tax payer and already contribute 40k into your pension each year to not have this option. In England you can effectively gross 90k before having to pay the higher rate and you can even use your pension to invest in property.
If you draw all the equity from the property, you most likely won’t have a positive cash flow. I have looked at it several times and I am not sure how it works. Any guidance? Use figures as I have checked with the banks and it doesn’t seem to work as it is discussed
I Take exception when you say it’s not worth one or two properties as a pension etc.. that’s personal choice!
Do you really want to rely on one or two properties in pension age?
Did I miss the part about risk? You mentioned refinancing and pulling out all your capital to achieve infinite return. What about the risk? Interest rate risk and your housing market exposure? Infinite risk to market downside...
Interest rate reaching the stars
@@alisonnorcross951 When you start from such a low base they only need to move marginally towards the stars if you're all debt and no equity.
@@ChrisLee-yr7tz or some tenant who decided not to pay rent. At least if you have 100% equity all you have to find is the community charge.
I have a registered a limited company a few years ago but stopped myself from buying any extra property because of the tax changes.
I now have the funds to buy a property outright will no mortgage or loans, if the plot has potential for extra houses how would you go forward
Hi Ranjan.Is it possible to pay some bills with credit card for few months to be able to raise money on current account for btl deposit ? How the lender look at this if manage to stay below 30 percent on credit card usage.Thank you
I fall into the old timer category and made three disposals this year within my Ltd company.....The company still owes me personally directors loans so i have options at the moment.I am a pretty seasoned equities investor and my current portfolio is outperforming my property cash flow at quite a high ratio. Its likely that i will continue to build the global equities portfolio over the property.
Any thoughts appreciated.One other thing the structure of the equity portfolio is still quite tax attractive with the max Isa allowance of 40k per couple /capital gains allowance roughly 24k per couple and tax allowance within the SIPP.
Hi mate, me and my business partner are trying to get started investing In properties. We have called many brokerages and they are denying us due to our age, we are 18 and have enough to put a 25% deposit down with a guarantor who owns 17 buy to let properties. Have you got any tips? Thanks.
My friend has buy to lets and his tenants stopped paying the rent 10 months ago and can't get them out and now his property are getting repossessed
Absolutely awful!
this is a problem right now.
Exactly btl is dodgy
Hi Ranjan, under how to start in property. How to evaluate accurately a property before buying it, post refurbishment, and sale price (buy to flip strategy). It seems to be a lot of discrepancy between agents, sourcers and platforms (property data, nimbus...) thanks for your help and guidance. Salim
Thank you for your comment and view, trust me I don't take them for granted.💯+1//5//5//1//3//1//9//4//8//5//4
One thing nothing can beat in the long term is….. a pension. All contributions free of tax and NI - take 25% tax free at the end.
You must be joking 😂😂😂😂I’m never investing in a pension
@@sniper8554 fair play. I’m so long term that I see my ISAs and pension as equal investing tools.
Great content
Hey Ranjan, GREAT VIDEO and just to prove that I was hanging on to your every word, at about 15:58 mins, you make your predictions for "2121" - I guess that's an example of "Extreme Forecasting" or am I being facetious ? (BTW - did you know that "facetious" is one of only a few words in the English language with all the vowels in alphabetical order?) Anyway, I'm looking forward to when The Baker Street Property Meets start again, so that I can be annoying in person :)
Do see you rpoint. Well spotted! Looking forward to bringing Baker Street Property Meet back in the new year.
The problem with the brewer method is that it relies on lenders lending....what happens when lending dries up?
In addition, there are age limits on BTL mortgages, so what advise do you have for say a 70 year old who wants to refinance his BTL portfolio but can only get a mortgage for 15 years due to the lender having an age limit of 85?
Thank you for your comment and view, trust me I don't take them for granted.💯+1//5//5//1//3//1//9//4//8//5//4
very interesting outlook
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Hi. I am looking at purchasing my first buy to let property and looking for some advice. I am currently a freelance CAD Designer and have my own limited company. Can I purchase a property via my limited company or do I need to open a new company specific to purchasing property?
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I am currently a higher rate tax payer and looking at setting up a company and purchasing a property in the Midlands with a fellow owner in the company. The other owner is also a higher rate tax payer.
We do not foresee leaving our jobs but the plan would be to actively grow the property portfolio for passive income - it sounds like you are saying this is a myth and is not worth doing? If this is correct, why?
I think If you own property through a company it is OK. Main issue with individual landlords is paying too much tax because they are high income earner, and limited types expenses that can be tax deductible. A business would only pay flat 20% on profit, and if you have a good accountant, he can help you reduce tax to a minimum, whereas individual is not able to reduce his tax liabilities. With a company you would then pay yourself using tax efficient ways such as dividend, or give yourself benefits such as purchasing a car for “business use”, which is now an expense and tax deductible. 👍
Fab video Ranjan!! Super informative!
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Hi Ranjan are you aware Property Forum appears right under your videos with a big subscribe button- I accidentally subscribed to their channel thinking I was subscribing to yours
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Money better off in pension or ISA invested in global fund. Tax free returns and up to 40% tax credit on pension investment. BTL returns suck in comparison when tax and costs and voids and bad tenants are factored in. Not to mention stamp duty and other fees eating away at valuable capital
What is motivated seller and where can I find them . I hear this word MOTIVATED SELLER everywhere but no one really wants to explain😆, thank you.
Someone that wants to sell quickly. Someone in debt, divorcees, accidental landlords from inheritance/probate etc
I was a motivated seller recently, my tenants left it in a right state, tax changes were approaching meaning I would pay tons more tax if I sold after the deadline, property was 140 miles away and I'd had enough.
I took lower than market value to get shot quickly.
Finding these deals is a matter of luck and looking constantly and also having contacts with estate agents etc.
Bear in mind these properties will generally need a fair amount of work.
great video !
You recommend forming a limited company but should that be a public limited company or a private limited company?
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Hi...dont think 10 properties are neccesary.....I have 3 and happy with them......pay £100 odd pounds on mortgage each,and get 1300 for each....happy medium for me as a retirement investment. I think three is enough to retire?
In which location?
Think of Buying a second home for work then renting 2 rooms out. Which will pay mortgage and bills and little bit extra. Plan was to pay off mortgage then bit of a pension. I’m I gonna get stung with tax when comes to selling?
Second homes are taxable so yes.
Tax man is into everything ..
I recently inherited over £300k and was looking to invest atleast 50% in BTL/HMO properties over the next couple of years. Thoughts?
Buy 4 freehold residential properties all in the same area. Get them managed by good people. You won’t be able to retire but it should give you roughly £1500 a month cash for very little effort, once it’s all set up.
Can I buy my first property through my current business? (Not a property company)
1 important question. If i currently have 2 BTL in my name(single let NOT HMO) even if i sale it how can i buy from scrtach as a compan if i need at least 6 properties (single lets as i'm not interested in HMO) its sounds impossible to me. Could you please answer. Many thanks and Merry Christmas !!!!
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Thanks! Are u reading from a telepromter?
NO. I find them difficult to use
@@ranjanbhattacharya-succeed7617 thanks. Your videos are great as is.
I live in Eastbourne do you think in January do you think air BnB or holiday let's are worth doing thank you
I would wait until vaccine/covid is sorted.
Thankyou for your advice
If you do rent out through a limited company, you get the benefit of interest relief but instead you get clobbered by the higher upfront cost of SDLT on residential property.
he doesnt address this so dont use a limited company if youre a basic tax payer. Buy in your own name until you reach the threshold. The advantages of property in your own name is when the property increases in equity, when you pull it out it goes straight into your account tax free! In a company you will pay tax to get it out.
The problem is that if you are a basic rate tax payer and you get buy to let mortgages, you will soon become a high rate tax payer. Remember your annual buy to let mortgage interest payment is added to your salary to determine your tax band
@@ranjanbhattacharya-succeed7617 thats why i said when you reach your threshold income of £50k then buy in a company
@@ranjanbhattacharya-succeed7617 you should still have mentioned this in your video for new starters
@@healthiswealth8153 depends what your ambitions are. I assume a buy to let landord will have earnings of at least 25k as that is usually the minimum required to get a mortgage. Unless you buy up north where rents are are low, if you are building a portfolio it won't take long to get to earnings of 50k. If you live and work down south, then I imagine most investors are very close to that 50K limit already. Restructuring your portfolio further down the line can be a costly business. Better to get the right structure from the outset. But again....its comes down to your goal. If its just to own a couple of properties then Id say incorporation is not for you. If its to become a professional landlord with a professional portfolio then its the only way to go.
@@jimboyuk1 yes i agree it wouldn't take long to hit £50k whatever your income but it could still be advantageous to have some in your own name if possible but in the long run if you are going to be full time in property you will need to be incorperated at some point to take advantage of being tax efficient
Buy to let for 1st time buyers it's not worth it anymore. The government will do their best to keep tight property business and make it even harder for "the middle man" class to invest in future!
So I'm a low rate tax payer with 3 buy to let's..and I still stay low tax with the buy to let's..I earn like £27000 plus about £15000 from buy to let's. If I did more buy to let's then I'd go higher tax and would be a waste if time.
Only good for capital growth long term. For yield just go for REITS
Yeah, I’m thinking be the same
What is a REIT?!
But if you refinance leaving 25 percent . You still benefit instead of selling. Capital gains tax will die with you and if maximise finance you reduce INHERITANCE tax?
This is likely to change. CGT review is underway with new rules coming in 2021
@@ranjanbhattacharya-succeed7617 As it is something that has just come into my realm of consciousness , then it must be the same for the Government. So annoying .
Given that the UK government is in massive debt....isn't the scrapping of section 24 an easy win for the government to raise additional tax income? I.e. BTL landlords who hold property in a ltd co are no longer allowed to offset mortgage interest against their tax liability.
Assuming it is, then is incorporation even worth the hassle?
has the government mentioned scrapping section 24? i hope so lol
@@healthiswealth8153 why would you say this?
@@jagsingh1979 Because S24 is a nightmare!!
@@ChrisLee-yr7tz in my comment I have suggested that the government could easily scrap section 24 relief for limited companies so not sure what this comment or the other one is about?
@@jagsingh1979 S24 is the restriction of allowing interest as an expense for private individuals. It isn't a rule that allows interest to be expensed inside ltd co's.
What if you buy cash, rent it out, then want to refinance, but don't have any income other than the rent i.e. no job. This could happen if someone has an inheritance, or wins the lottery lol
Before I watch the video I hope your answer is no since a very short time ago you said buy to let is dead!!!
Yes.In that video th-cam.com/video/ZG2prbw8QWo/w-d-xo.html I am talking about the direction of travel buy to let has taken over the last decade and where its heading. Whether to do buy-to-let is not a one size fits all answer for everyone. This video attempts to break down the answer in terms of where people are in their property journey
@@ranjanbhattacharya-succeed7617 fair enough
Is there a company that does tenant checks
Do your own and always always check their previous landlord as current landlords will say they are good if they want a bad tennant out.
From the perspective of a young person who is looking to get onto the housing ladder BTL is a nightmare. BTL is driving up the price of housing, the government keeps saying they're building affordable housing. The reality is all affordable housing becomes BTL, making it ever harder for 1st time buyers to get a start.
It’s the government giving incentives to first time buyers that is pushing up the price of houses- house builders are hiking up their prices because demand is high!
Property investors are generally bringing empty homes or property that needs a lot of work done and turning them into homes - homes are in short supply because there are not enough new homes being built.
This guy is encouraging people to get into huge debt and go bankrupt.
Thousand properties 😂