staceyirvine Posted February 13, 2012 Share Posted February 13, 2012 Hellppp can someone give me some advice?? We have decided to rent our house out as we can't sell it been up for 7 months and only 4 viewings!! Now we are thinking of going through a managemdnt company to look after the house whilst we move (hoping to move to perth in may) is it worth paying them? Do they actually do a lot? We dont plan on tellin mortgage comp as they will put our mortgage up another 100 a month, if we pay management fees we are Goin to be adding to the mortgage!! We are just goin to cover mortgage as it is what with landlords insurance boiler cover etc we are adding to this!! Any advice and tips would be useful!! My head is burstin with it all as is my OH's!! Its putting loads of stress on the already stressful time! Got shippers quoting on thurs!! Wish we could sell it!! Meant to add have dropped house abt 19,000 already!! Thanks x Link to comment Share on other sites More sharing options...
flybyknight Posted February 13, 2012 Share Posted February 13, 2012 insure everything, boiler pipes electrics, and get a management agent to look after it. do a tax return in the uk (or in oz if you're getting a 176) and claim the lot back and 10% depreciation if you leave some furnature. you will pay a bit of tax, but if you run it at a deliberate loss you should at least break even with everything insured. good innit peace of mind and cash in your pocket. Link to comment Share on other sites More sharing options...
pintpot Posted February 13, 2012 Share Posted February 13, 2012 insure everything, boiler pipes electrics, and get a management agent to look after it. do a tax return in the uk (or in oz if you're getting a 176) and claim the lot back and 10% depreciation if you leave some furnature. you will pay a bit of tax, but if you run it at a deliberate loss you should at least break even with everything insured. good innit peace of mind and cash in your pocket. Yes, do this You will need an agent if you are on the other side of the world - someone has to be there to handle affairs with the tenant and it will make your life a lot easier Tax breaks can be pretty generous, depending on whether you are in the UK or Australian tax system but the principles are broadly similar You definitely need landlord's insurance, or you are completely exposed if your tenant burns down the house Sorry to say, but you do also need your lender's permission. Rent it out without permission and you expose yourself to all sorts of risks if the lender finds out (because you've broken your contract with them). And other risks if you are unlucky enough to get a bad tenant (because the tenancy agreement won't be worth the paper it's written on, which makes it unenforceable) Link to comment Share on other sites More sharing options...
flybyknight Posted February 13, 2012 Share Posted February 13, 2012 further to this, when you tell the lender you want to rent it out what do they do? put the intrest rate up? guess what else you can claim on the tax? intrest on the loan! all good Link to comment Share on other sites More sharing options...
AJ Posted February 13, 2012 Share Posted February 13, 2012 We rented ours through an agent and they wanted to see a letter from our mortgage provider showing their agreement to us letting the house out. Maybe not all agents ask but you might need this Link to comment Share on other sites More sharing options...
prof moriarty Posted February 13, 2012 Share Posted February 13, 2012 Just to echo what others have said - definitely go with an agent. They sort out all legal docs and can do check in inventories. At first it seems a pain paying agents' fees but I wouldn't like to go it alone. Also it's better you tell your lender that you intend renting - any insurances on the property will be invalid otherwise and as someone else said earlier, if you go with an agent they will most likely want to see that your lender has given permission to rent out. Good luck! Prof M Link to comment Share on other sites More sharing options...
staceyirvine Posted February 13, 2012 Author Share Posted February 13, 2012 further to this, when you tell the lender you want to rent it out what do they do? put the intrest rate up? guess what else you can claim on the tax? intrest on the loan! all good Really?? All the tax business confuses me too! Do we get taxed even if we arent making any profit? Link to comment Share on other sites More sharing options...
flybyknight Posted February 13, 2012 Share Posted February 13, 2012 you only get taxed on clear profit, so if you can spend it, you profit. (does that make any sense?!?! lol) there are a few little helpers, like the intrest on the loan, 10% for wear n tear etc that can make you a little 'profit' you should be ok though. if you break even it's been a bad year, or you have a ****e accountant. see one who specialises in this sort of thing. Link to comment Share on other sites More sharing options...
ck10_9 Posted February 13, 2012 Share Posted February 13, 2012 We rent our house out in the UK - Have done for 5 years. There have been a few minor issues but the agent and family have helped out. It's the best thing we could have done as we will always be on the property ladder in the UK, should we ever move back. The place is even making a little profit now Link to comment Share on other sites More sharing options...
staceyirvine Posted February 14, 2012 Author Share Posted February 14, 2012 you only get taxed on clear profit, so if you can spend it, you profit. (does that make any sense?!?! lol) there are a few little helpers, like the intrest on the loan, 10% for wear n tear etc that can make you a little 'profit' you should be ok though. if you break even it's been a bad year, or you have a ****e accountant. see one who specialises in this sort of thing. If we tell mortgage comp we will have to put abt 30.00 to cover mortgage payment plus 100.00 of management fee then about 30 boiler etc cover and then landlords insurance, all in all we have to pay 200 to it each month!! Which if we are renting out in oz as well is going to be expensive! Why cant things be simple?? Wish we could just sell it and get rid!! Its all v stressful! Thanks for everyones comments!! Link to comment Share on other sites More sharing options...
ADAWN Posted February 20, 2012 Share Posted February 20, 2012 Hi Stacey, we are in the same boat as you although we haven't tried to sell as I though it would be good to keep as we may return in 3 years. our rent probably won't quite cover the mortgage and then with fees, insurances and tax we will have to send maybe £200 a month back, but what I don't understand is do we have to pay tax on the part of the rent above the interest repayments (does this make sense?) Link to comment Share on other sites More sharing options...
pintpot Posted February 20, 2012 Share Posted February 20, 2012 Under the UK tax system, you can set the following off against your revenue: Mortgage interest payments (not capital) Agent's fees Insurance Maintenance and repairs Any other actual expenses involved with the let - legal fees, phone calls etc If you let your property furnished you can also claim a 10% wear and tear allowance on the furnishings/white goods etc See here: http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/TaxOnPropertyAndRentalIncome/DG_4017814 I don't know the Australian tax office rules, but I expect they will be similar. Most tax jurisdictions run on the principle that you're only taxed on the profits, and the profits from a letting "business" are rents less those expenses Link to comment Share on other sites More sharing options...
thombatt Posted February 20, 2012 Share Posted February 20, 2012 The agent I use works hard for me, but they are a very small localized agency. When they collect rentals I begrudge them the fees that they take and think it's a rip off, but when they have to arrange for a new tenant I think their fees are cheap. What I do begrudge is the 20% VAT on the fees that they charge, I get absolutely no value for that. Link to comment Share on other sites More sharing options...
AJW Posted February 26, 2012 Share Posted February 26, 2012 We rent our house out in the UK - Have done for 5 years.There have been a few minor issues but the agent and family have helped out. It's the best thing we could have done as we will always be on the property ladder in the UK, should we ever move back. The place is even making a little profit now Hi there ck10_9, may I ask which agent you are using? Thanx Link to comment Share on other sites More sharing options...
AJW Posted February 26, 2012 Share Posted February 26, 2012 Hi there ck10_9, may I ask which agent you are using? Thanx In 5 years did the house ever sit empty and how did you pay the mortgage when this happened. We are so worried that ours will be empty inbetween tenants and the mortgage doesn't get paid! Link to comment Share on other sites More sharing options...
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