Property costs 1989-90! Weird questions

[Pluvia]

I have POA for an elderly relative who has recently gone into a care home. I'm trying to sort out her finances.

To fund her immediate care I'm just about to sell her holiday/ second home, which she and her late husband purchased in 1989. We complete next week. CGT needs to be paid on the sale proceeds and I need to provide details of how much was paid for the property in 1989 and how much it would have cost in conveyancing and EA fees etc. There's absolutely no paperwork that I can find. My aunt is adamant that they paid £85,000, but there are no existing Land Registry records before 1995. What does one do in these circumstances?

Apparently we're allowed to claim for the Estate Agent's fees, too –but again, no paperwork. Has anyone else been through this?

P.S. I bought my first flat in London in 1989 too OP! Ahhh that negative equity

I think Zoopla only goes back to about 1997, our 1997 sale price is on there but the neighbour who bought a couple of years before us price is not there

This sounds potentially plausible. She will have bought at the height of the market. Your aunt’s house could have been 85k in 1989 and then worth 55/60k in 1995…. Prices crashed by circa 30%, more in some places. Idk if you can find anything comparable in 1995.

Plug some figures into this house price calculator and see what produces the current sale price. It's a regional guide even with a specific postcode but it might help.

www.nationwide.co.uk/house-price-index

But as you say OP, the gain is huge over 33 years and with the rate of CGT on that (without checking think it's 18% or 28%??) , a few thousand either way on the original costs isn't going to make much difference to the big picture.

The deductible fees are the fees you are paying now for the current sale. Buyers wouldn't have paid any estate agents fees in 1989 and I don't think that any fees from that time would be deductible even if you knew what they were.

Just a point of information for all those saying 'Try Zoopla' and 'Try RightMove'. House prices weren't routinely recorded till 1995. Anything bought or sold before that time there is no record of price paid.

@Whingasaurus

Capital gain allowances are quite high and roll over. 1989 is 43 years ago.

I was born I 1980 and I’m pretty sure I’m only 42. It’s 33 years ago.

They may have paid over the odds for it

£85k sounds quite plausible to me.
I bought in 1990 and my semi-detached 2.5 bedroom house in the South was £67k iirc. Bath would be more expensive than where I bought.

@MostlyEatingBiscuits

Plug some figures into this house price calculator and see what produces the current sale price. It's a regional guide even with a specific postcode but it might help.

www.nationwide.co.uk/house-price-index

But as you say OP, the gain is huge over 33 years and with the rate of CGT on that (without checking think it's 18% or 28%??) , a few thousand either way on the original costs isn't going to make much difference to the big picture.

The Nationwide calculator actually offers a value higher than £85k in 1989, so I will offer that as evidence if HMRC want to dispute it. Many thanks for that. I count that as a win — and wonder if I can use the Nationwide figure instead... But no, the chancellor needs every penny.

Many thanks to everyone.

Glad the calculator thingy was useful, OP. Good luck with the house sale(s).

@Zilla1

IF the mortgage provider can't help then try to track down the success of the EA or solicitor. There will still be records held somewhere by the firm that took on their clients.

I was told by a solicitor when I was trying to track down similar information that they only keep records for 7 years

If it is a period property, is it Grade II listed - would they have needed permission for any work or alterations? Not sure that any permissions would have the house value on them though, it's not the Daily Mail where they quote a house value at every opportunity!

Thank you for the suggestion. The house isn't listed. It's actually Victorian, I think around 1860, but could be mistaken for a being earlier.

I’ve done CGT calcs before with no cost, there is an area on the RICS website that you put the location, size of property and year of purchase and HMRC will accept that.
You can’t claim the legal fees/stamp
duty on purchase if you don’t know what there were.
Don’t forget to claim capital costs if she did any and costs of disposal.

Also if she inherited your uncles half on his death don’t forget to use the probate value for that half not the earlier value.

DH and I bought our first home in 1989, a small Victorian house in the home counties. We paid £75k for it. When we sold in 1994 we could only get £60k for it.

@Pluvia - Apologies if I've misunderstood this, but if you are worried about finding evidence in order to reclaim estate agent costs from the 1980s, I would've thought they're going to be so low (in the grand scheme of the capital gains tax and value rise in the house) that it probably isn't worth bothering about it either way?

Local surveyor should be able to help

Ahh sorry, I now see you've made this point yourself later in the thread...

I bought a flat in April 1990. A tiny new build one bed flat in a commuter town 30 miles from London. It was £42k. 18 months later it was only worth £28k. Lots of people who bought around that time ended up in negative equity as prices crashed and 100% mortgages had been very popular and easy to get before that.

The council tax band would give an indication of the approx 1991 value

www.gov.uk/guidance/understand-how-council-tax-bands-are-assessed#council-tax-bands-in-england-based-on-1-april-1991-values

I bought my first flat in 1988 for £15,000!! My husband bought what is now our family home in the early 90s for £38,000. Even now these are fairly cheap properties though - think our house worth about £200,000 and the flats go for about half that .

@AngelsWithSilverWings

I bought a flat in April 1990. A tiny new build one bed flat in a commuter town 30 miles from London. It was £42k. 18 months later it was only worth £28k. Lots of people who bought around that time ended up in negative equity as prices crashed and 100% mortgages had been very popular and easy to get before that.

Yes. The flat I bought for £15,000 in 1988 - others in the block were sold for £35,000 in 1991. I think I got £25,000 for mine in 1995 - so still a nice profit for me but awful for someone who bought at its highest price .

Thanks for all those pointing out about estate agent fees etc being so small as not to be important. I appreciate this but as I'm acting on behalf of someone else and must be seen to be at least trying to include everything that could save them money I feel obliged to try and tick all the boxes if I can. I won't be doing the CGT calculations myself, I'm going to leave that to the accountant who actually knows what they're doing. Excellent point about the value of my uncle's half of the property at probate, by the way, I'll put that in the notes for the accountant.

The next thing I'll need to do, I suppose, is try and look for ways to minimise IHT if that's possible. Apparently it's all going to the RSPCA, Cancer Research and her local hospice, so we'd better do what we can for them.

My top tip to you all is that when a sprightly aunt approaches you and ask you to be her attorney and tells you there's nothing to it, run for the hills.