Should I sell up or buy more?
I have a number of BTL flats – all fully occupied.
I bought them some time ago at around £20k then remortgaged at a later date with mortgages around £70k to fund a family home.
We can hardly complain – capital growth paid for the family home – with the mortgage on the flats being more than covered by the rent.
So what’s the problem….???
The mortgages are interest only so the day of reckoning for repayment will arrive in 10 years when I need to repay the mortgages.
Next……… I manage the flats in addition to a full time job and would like to “slow down” and have more free time.
So what to do?
Should I sell the flats, pay the astronomical CGT (but in fairness I have made an astronomical profit) and clear all mortgages or appoint an agent to look after the flats and forget about them for a year while they manage any issues. This also leaves the little issue of having to eventually repay the mortgages.
Any impartial advice?
Thanks
Alison
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Previous Article
Is section 21 valid?
Member Since July 2013 - Comments: 561
7:00 PM, 22nd December 2014, About 11 years ago
The CGT is may be less when you are retired, but how long until then? (Assuming you are over or close to the 40% band at present.)
If you are married, then take detailed tax advice as it may be possible to greatly reduce the CGT.
Member Since April 2014 - Comments: 136
8:33 AM, 26th December 2014, About 11 years ago
Reply to the comment left by “Alison Winter” at “20/12/2014 – 20:30“:
Took out BTL mortgages to age 89 earlier this year and I am 68
Member Since July 2013 - Comments: 357
2:47 PM, 26th December 2014, About 11 years ago
Hi Alison
I was just about say but Bill got in before me. These days they are lenders that will allow you to re-mortgage way beyond retirement age I think it is 90.
If you start planning so all the mortgages don’t need done at the same time you can look for the best deals and re arrange. them between now and when they are due to be paid. As they are in positive cash flow this should not be an issue.
As Mark says his letting agents fee are very good and by far undercut most I know of it has even me thinking about it. I just got a quote on my landlord insurance and it is looking pretty good to me. Just waiting on my current provider to send renewal quote then I can decide.
Yes you will still have question to answer and tasks to do but the majority will be done by the agent leaving you free to enjoy your retirement.
If you decide to sell then plan it carefully so you only pay the capital gains tax that you need to. I think you can claim the last 3 years CGT so when you sell a property use this up if you have not been using it. Also if you have a husband or partner put them on the deeds allowing to use their as well. Then sell them one at a time over the years to take advantage of CGT.
I am not a tax expert or financial adviser but find a good Accountant or Financial adviser then they will help you plan. When you release your cash take a long hard think what you want to do with the cash.