Town & Country

There are many reasons for someone to want to rent out their property instead of selling it when they move home.

You may be moving in with a partner so do not need the money you normally would to buy a new property.

You may be moving temporarily for work and need to keep the option of moving back open or you are financially sound enough to not need to sell your old property in order to buy your new one.

Whatever the reason, there are some considerations to take into account before you make a decision.

The first will be to check that your mortgage company will allow you to do so. Most mortgages have a clause written into the small print that do not allow you to rent out your property or if you can, only for select periods of time. This could mean that in order to rent it out, you will need to change your mortgage to a higher interest, buy-to-let mortgage which may incur additional fees such as early repayment fees, valuation fees, survey fees and new mortgage fees.

The second will be the price of the property market and what you think it is likely to do over the years that you are going to be renting your property out. If prices are rising, then it is likely to be financially beneficial to begin to build a property portfolio. If they are falling, then you may be better off in the short term to sell while the price is still high; however, if this is to be a long term situation, renting may still be the way to go as property prices do invariably tend to go up in the long run.

If your old property still has a mortgage, your mortgage lender is likely to insist that the rental income is enough to cover the mortgage interest payments and you will also need to factor in how many months of the year you are likely to be able to rent out your property for. Using a good letting agent who will give you a an accurate rent valuation and professionally market the property will minimise any void between tenants and could save you a significant amount of money.

As a landlord, you are also responsible for the cost of any repairs, such as boiler breakdowns, damp or roofing so will need to be able to cover that cost as well.

Any profit made on renting out your property may be eligible for income tax; however, HMRC does give allowances on maintenance and you can offset professional fees such as agents or property managers, but you will need to ensure that you know what you will be left with after. You will also need to factor in capital gains tax when you do sell the property however that does depend on your circumstances, but it is best to get financial advice on this before you start.

Here at Town and Country Lettings, we aim to make renting your property as easy and trouble free as we can, offering a free property assessment and valuation service.

We are on hand to offer advice on all areas discussed above and manage the whole process including the relationship with the tenant, providing you with peace of mind.

Contact us today on info@tclets.co.uk or call 01366 321048 (Downham Market) or 01945 871336 (Wisbech)