Renting out our main residence?

Renting out our main residence?

8:40 AM, 5th January 2022, About 2 years ago 2

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We have a shared 25% ownership apartment with a mortgage in London which is currently our main residence, and we need to move to the Northwest for 1 or 2 years. We would need to rent out our London apartment for financial reasons during this period and would like to purchase a property in the Northwest and then after 1 or 2 years either move back to our apartment in London or remain in the Northwest.

One of us is currently a 40% taxpayer, and we do not currently own any other properties. We would appreciate advice generally but specifically on the following.

1/. Buy the property in the NW in our own personal names or through a Limited Company.
2/. What type of mortgage to purchase the property i.e. Main Residence mortgage/ 2nd home/ BTL
3/. Tax implications.

Thank you

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Neil Patterson

8:49 AM, 5th January 2022, About 2 years ago

Some initial thoughts:

You would need to get consent to let from your existing mortgage provider.

There may be conditions in your shared ownership agreement prohibiting your letting the property?

The new property would be your main residence, so a main residence mortgage would make more sense than purchasing in a Ltd company, as the tax treatment of main residences is much better. Unless you have plans to purchase many more and move around, but you said funds were tight?

You would pay tax on the rented property if that is what you end up doing dependent on ownership split, but we would need to know a lot more, so please see >>


10:05 AM, 8th January 2022, About 2 years ago

It would be unusual to be permitted to let a shared ownership property so if you want to keep it you'll have to shoulder the costs of both.

The good news is that you can probably get a 2nd home residential mortgage

Whatever you do make sure you're registered for notification by the Land Registry in case someone tries to "steal" it while you're away

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