Is property still worth investing in?

[overthinkersanonnymus]

i haven’t looked at the ins and outs of the new rules re rentals, but if you had a little money, would you consider a BTL?

I work on the periphery of property development and have seen some of the massive incomes and portfolios that some clients have (all very good landlords with beautifully maintained houses) and I was looking at maybe starting to build my own little portfolio.

Is this a good idea? What should I be aware of?

Yep, we have our shower heads checked for Legionella. Plus Pat tests, EICR, Gas Safety and soon the EPC will need to be C or above. Landlord registration is another cost, if applicable and service charges, agent fees...

It's basically the destruction of the small landlord. What a lot of people don't realise is that historically most landlords were accidental and a lot of them are women. It was one of the few ways for women to accumulate wealth in previous generations.

Ltd companies investing in property are NOT IHT free.

@reversegear check with your accountant but companies holding BTLs are generally treated as investment companies not trading companies and hence don’t qualify for relief on IHT.

I’m not in the uk so I’ll just talk about the hassle factor.

Long term lets that work are very easy. Not much to do in a year.

Holiday rentals are a massive PIA. High season is pretty much whenever you’d like to go away and most weekends. So either you need to employ somone who is properly a good cleaner (much higher standards than you’re average domestic cleaner) and ideally has a great network of tradesmen to fix the toilet in the 5 hour turnaround window and replace the fridge. Or you do it yourself and know that you are tied into it a lot of the time. If it’s not within 30 mins of where you live I’d be hard pushed to describe the nightmare it can be. Set up costs are higher because you need 3 sets of all linens and a fully furnished property. And the rental companies like VRBO and AirBnB are very generous to themselves. Avoid booking.com their terms are punitive.

They aren’t generally treated, that ARE treated as investment companies.

Apologies I mean to clarify my boys will be 100% shareholders so we won’t own the assets. So IHT won’t be paid ( potentially) If we get the timing right.

But you said you’re putting profits into your directors pension, are you therefore an employed director or a share holder?

transfering shares still triggers taxes of all appropriate types

Either of these scenarios might not meet the tests for a large company pension contribution.

A little money? No way, likely financial suicide.

if you have a lot of money then maybe!

do you really want to be a landlord? Have you exhausted all the other easier options such as pension and s&s isa?