Any experts in house rentals around? Questions re letting a house

[knockitalldown]

We are planning to move abroad and considering option re our house in UK. Here is the situation -

• our house is a 1970s ex-LA house, recently completely renovated, with new windows/doors, kitchen, gas CH, bathrooms, oak flooring, doors, electrics etc

• my parents house is basically same house, with different layout, but not renovated, i.e. kitchen serviceable but 20 yrs old, windows double glazed but older. Fairly good decorative order, with newish bathroom and new downstairs loo.

We are considering having my parents move into our our house, which would give them benefit of the renovations, and us the benefit of not having to worry about renters trashing the place.

So we have two houses, and two sets of furnishings - we won't take much with us when we move, as it's mainly IKEA, so cheaper to buy new than pay for removal! We are considering letting one of the houses furnished.

Question 1 - will there much of a difference in the amount of rent we can charge, between the two houses?

Question 2 - what is the difference between letting a house furnished or unfurnished? Will we get more or less money for it?

Is there anything else that you can think of that we might have overlooked? It might be that we save money on potential damages to our house by having my parents in here, but will we lose more on rental costs?

Sunnyshores
I understand very well what can go wrong. I don't know where you are getting that idea.

We've pretty much decided that we'll let our house out, not my parents, thanks to the advice given on this thread. Some of the issues we'd already considered, but some were new to us, so it's been very helpful.

Will speak to some letting agents here to find out what they think.

wrt to letting out an unrefurbished house vs refurbished.

everything needs to work properly. a tap that only gives hot water if you turn it 'just so' will not do.

just something else to consider

Where do I get the idea you dont understand?

Have I misunderstood, are you a trained professional landlord then? The very fact that you think you know what you're doing and think because you can credit check a tenant you dont need an agent is proof in itself you dont understand much other than the tenant pays my mortgage off for me.

Sunnyshores
I have no idea what I've said that has gotten you so riled and combative. I have never said that I know EVERYTHING, only that I know that things aren't always simple.

I explained that in my experience, where we've lived before, it is unusual to use agents, so I hadn't considered that it would be necessary. I'm willing to take advice and am grateful for help offered on this thread.

The plan is for us to keep this house as security. I'm not interested in making a killing from the UK mortgage market, but if we were to sell now we'd not recoup what we've spent on the house. Our intention was originally to stay here longer, but we've changed plans.

I find your attitude and responses really quite rude and patronising. Don't feel you have to stick around, if you find my little problem too boring.

Tarzan
that does make sense - the furnishings that we have are ok, but not great quality, so probably best to let unfurnished. I don't want to have to replace them!

nice attitude to someone trying to help you, OP. You have said you aren't used to the UK rental market, and from the questions you were asking that is abundantly clear.

what you are being told is that this can go wrong BIG TIME. You don't have to use an agent, but you do need to be fully aware and insured against all that can go wrong.

getting it wrong can lose you the house, get you fined and even get you imprisoned. Less commonly, getting it wrong can cost you lots of money.

most tenants are decent honest people, (as are most landlords) but there are some that are not. The difference is that a landlord takes a lot more risk. That's business for you. Your business, not that of your parents.

no-one has mentioned CGT - that's also complex and the fact you are leaving the country may also affect that. Consider that too.

hope it all works out.

Specialist
I have at no time resisted the advice that was being offered, and have at several points thanked those who have posted. The rudeness from those who obviously think they know everything is really not necessary.

Well I think you may have got some of the responses you've had because you started the thread asking two questions solely about the money you'd get and if there was anything you might have overlooked.

It appeared there was plenty you had overlooked or weren't aware of - it's tricky to get a handle on someone's knowledge from their opening post sometimes.

Fwiw I think you need to obtain professional tax and financial planning advice before crystallising your plans.

Those pp who have taken the time to advise you have done so to help you out: better to be aware of the pitfalls now than when your house is trashed and your parents ring to tell you there's a massive repair bill and you'll not be getting any rent for several months. Or when, God forbid, a corner has been cut somewhere and your tenants are injured or worse.

no-one is being rude, you are being over-sensitive. Not good for someone about to start a business.

especially this business. Just you wait...

I was in a similar position a while back. I've been a landlord for 10 yeArs now, with (thankfully) decent tenants. I'm not sure I'd do it now, though. As long as you're not thinking of it as guaranteed easy money and take care to minimise the risks, you'll be ok. There are many accidental landlords. I think on the whole the compliance side of being a landlord is becoming more onerous, which is why I'd recommend using a lettings agency for at least a tenant find service. They'll be able to handle the initial admin stuff.

In general, I'd recommend letting unfurnished, with as few appliances as possible. If you have a mortgage, you'll need to inform your lender. Do your research and decide what sort of tenants you'd like. Sites like Rightmove and Zoopla will give you an idea of the sort of rent you can charge. Check that insurances you take out actually cover what you need to be covered (for example, some policies may not cover HB claimants; I found out too late that my own policy doesn't cover my property whilst there is a child living there).

And your parents may well be able to cope. Do your research together and discuss things with them. You'll need to factor in the cost of an agency if you decide to go down that route. Capital gains may apply if you subsequently to sell at a profit. And you'll need to declare the income to HMRC.

Good luck.

Wowfudge
Apologies if the OP gave that impression - when I asked if we'd overlooked any issues, I was talking about the actual dilemma re which house to let, and furnished/unfurnished. I'm aware that I'll have to spend a lot of time researching tax, mortgage, insurance etc.

absolutely
Thanks for the advice - I'll add capital gains to the list (although it is a small and inexpensive property so don't think it will be a huge payment due).

I've just remembered that my cousin is a letting agent in a neighbouring town, so she'll be able to give me some advice.

On the CGT position - the value now is not the issue. Do look into it.