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Photo of house on a key ring to represent residential property

Property specialists consider the lifecycle of a landlord

Rob Case spoke with George Tatham-Losh, Managing Director of Move Estate Agents about what landlords need to know…

Move Estate Agents deal with residential sales and lettings and specialise in sourcing properties for investor’s portfolios with offices in Cheltenham, Gloucester and a third opening in Worcester.

What do property landlords need to consider when starting out?

Some people become accidental investors having inherited a property but others come to George for assistance in planning the type of properties they wish to invest in.  For example some may want to invest in a mixed-risk portfolio whereas others see that property is a relatively safe strategy in making a return. What is clear is that getting the structure right from the outset is really important – property portfolios need to be structured correctly to make the best of your investment and also in relation to your tax position.

The first thing George recommends to people who come to him wanting to buy an investment property is to make sure the structure is correct from the start, as transferring existing properties comes with all sorts of tax implications, and that they speak to me for sound advice.

I explained that there are lots of factors involved, principally understanding what their individuals goals and strategies are which may be as an example to pass onto future generations.

George confirmed that it’s important to talk about yield and different types of properties. Is it a short, medium or long term investment? The advice you would receive will be completely different for each scenario.

Whatever the goal, it’s vital to have a property tax specialist involved to make sure you don’t fall into any tax traps.

Managing your property – why use a lettings agent like Move?

With Making Tax Digital being introduced from April 2024, landlords will need to report rental figures to HMRC digitally every quarter. Move share access to software that their landlords can use to log in to and download statements relevant to completing their tax returns.

Move is an ARLA registered agency and work to a code of conduct with a ring-fenced client account. When looking for a managing agent you are effectively looking for someone to run your business for you. You will receive solid advice, help with sourcing your properties, ensuring you get the best buy and advice about what to do to the property to get the best rent.

A lettings agency supports you with sound advice on strategy and structure, making sure you adhere to relevant legislation, ensuring compliance (for example in October carbon monoxide changes are being introduced) and maximising your return on your investment, Move also action rent increases on behalf of landlords. In using an agent you are paying a percentage of your rent to that agent but George believes that they earn this percentage by maximising your returns, keeping abreast of changes and helping you to make informed decisions. Move regularly review their portfolio with their clients.

Choosing when to come out of the market

Some landlords are looking to sell property with the market being buoyant currently, but there are always tax implications to consider and more importantly plan for.  Individuals must report and pay any Capital Gains Tax within 60 days. It is best to ensure you have checked prior to sale to understand whether you are utilising all your tax allowances, whether there could be an early redemption charge upon settlement of a mortgage and whether you might be able to do anything differently.

We would certainly suggest that planning for exit is important and ideally you should look at least 5 years ahead!

Watch the video:

Rob Case is Tax Partner and happy to have a chat if you are thinking about becoming a landlord or at the other end of the lifecycle, looking to sell – call 01242 776000 or email rob.case@randall-payne.co.uk to arrange to have a conversation.