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Original poster

Stamp duty

29 replies

eyeeyeeyeeyeeye · 28/02/2025 14:30

I own a property already, it's mortgage free but not big enough for our growing family. Realistically we need to move but the stamp duty is like £35k on a house we like.
I don't really want to sell the house as I'd like to keep it for my kids, but also was thinking of renting it out. We can do a £50k deposit on a mortgage but no way can we afford the stamp duty too. Is it best to sell the current house and use that as a mortgage and use the deposit savings for stamp duty?
Thanks

OP posts:
Ineedanotherholidaynow · 28/02/2025 16:57

Income Tax being the main one as you will be taxed on the rental profits above your personal allowance. Should you choose to sell in the future you will be liable for capital gains tax.

You’d need landlord insurance, PAT and Gas safety certificates and the house would need to be in a good state of repair. Should the house not be let for any period you’d need to be able to cover the mortgage when there is no rental income. Mortgage interest is not tax deductible against rental profits for self employed landlords (I.e not a Ltd Company).

A letting agent can usually manage things for you such as finding tenant, doing relevant referencing checks and dealing with taking the deposit and the tenancy agreement. For a fee they can also deal with any ongoing repairs such as instructing plumbers etc on your behalf or you can manage it yourself.

With the right tenant it can be easy but a nightmare tenant could leave you with a mortgage to cover and them not paying the rent, and it’s a long drawn out process with court fees to get them evicted and you wouldn’t see the rental money for dust.

Not trying to put you off but if you’re not clued up it can end up a costly mistake.

pompey38 · 28/02/2025 17:19

eyeeyeeyeeyeeye · 28/02/2025 14:55

Okay, I really want to keep this house.
Can someone explain it to me like I'm 5? Like step by step what would need to happen

You get a loan of let’s say 85k on your current house ( normal loan guaranteed with the property) -you pay the loan with the rent money , you use the 85k to buy the new property

You get a buy to let mortgage ( capital repayment not interest only) on your current property let’s say for a10yrs term on for 85k and buy the new property

Equity release if i’m not wrong it’s only for over 55 yrs old

There is no way on saving paying stamp duty extra % how long you want to keep your current house .

You need to look at what option is best in terms of repaying /apr and the rental value of your property

pompey38 · 28/02/2025 17:21

WallaceinAnderland · 28/02/2025 14:57

Do you know what is involved in renting out your house? Do you know the legal responsibilities of landlords and all the costs involved? It's not so simple as you might think. You also need to be aware of the added cost on second homes, such as council tax and capital gains when you sell.

If you are not confident that you have the knowledge and funds available to maintain two properties and manage a tenancy, then I would say just sell your house and use the cash as a deposit on your new home.

Is not as complicated as you make it out to be either

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Original poster
eyeeyeeyeeyeeye · 01/03/2025 21:35

Just coming back to update that we've decided to sell this place and use it as a deposit on another home. It's estimated just over £204k on Zoopla, it's been extended with new kitchen diner, garden was done a few years ago and soon to have a bigger porch and new windows on the front.
Is that amount a good enough deposit ?

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