For a while, property investment was the ‘big thing’. House prices increased exponentially and with it, residential rents rose significantly. The returns were big. Ambition could flourish. Then following the crash everything got a little bit harder, but Buy to Let was still profitable, rents still increased, profits were still good.
Now, with new tax laws and far more severe tax liabilities Buy to Let looks increasingly like a burden. Landlords up and down the country are trying to shuffle their portfolios to minimise tax.
With this in mind, how should one invest in property? Life Tenancies may offer a solution.
WHAT ARE LIFE TENANCIES?
Life Tenancies are where a tenant has a lifetime let on the property and are entitled to live there until they permanently vacate. They are over 60 and have purchased a lifetime lease living rent-free.
Once you purchase a Life Tenancy property it becomes yours to do what you want with once the tenant moves on. This includes moving into care as well as passing away.
Given the nature of Life Tenancies, many properties can be purchased at a reduced rate averaging 47% below the Royal Charted Institute of Surveyors vacant position valuation. This is a significant saving.
Unlike the Buy to Let landlord you will not have to pay the increased stamp duty that is causing so much distress among landlords at the moment. Life Tenancy purchases are at the standard stamp duty rate.
Once the tenant has vacated the property you are then free to do what you want with it. Rent it, sell it, live in it, pass it on as a gift to your family. Life Tenancies give you viable solutions to making a good return on property investment without the tax burdens. No matter what your plans are this form of property investment facilitates it.
HOW TO PURCHASE LIFE TENANCY PROPERTIES?
Wakeley Residential Investments specialise exclusively in Life Tenancies. They have properties in the lucrative south-east region , know the market well and are able to provide advice. This can be invaluable if this is new to you, and you want more information before making a purchase.
THE BUY TO LET TAX HORROR
The extra 3% tax duty on Buy to Let properties is causing panic among landlords especially if they have large portfolios. This is adding thousands to tax liabilities making a severe impact on profit. The once lucrative Buy to Let market has changed significantly.
INVESTING IN PROPERTY 2019
Although Brexit is the buzzword on everyone’s lips from a property perspective it is not the game changer. It is the change in tax laws that will affect the types of investment in property made in the future. If you are planning to invest in property in 2019 you should definitely look at all the options and seek advice. The landscape is different now and the returns from some investments not as good as they once were. A Life Tenancy investment may well offer you the best returns and be the safest investment you can make.