missbad

Hi All

I thought I would ask on here first as I dont want to contact any estate agents as yet. ( otherwise they will all be over me like a slug on lettuce)

Has anyone rented there home out in the uk before moving to Spain as I just want to know what is involved. I have heard I will have to notify my mortgage company to ask permission and they could put my interest rate up as I will be letting the property out.

But also what I need in place legally and what needs to be done. Any help will be appreciated.

cricketman

Yes I did it. You have to notify your mortgage company, they made me switch products which cost me the expensive admin fee, then after 3 years they made me switch products again to one with a higher interest rate

We simply contacted our estate agent. They found tenants. We had to fill a form in saying we were non-resident. We still have to declare tax in the UK because of the income from the rental.

In terms of estate agent comission. We pay 8% per year for finding the tenants. We manage the property ourselves as it is a small flat and anyway, it is only a question of calling workman if things go wrong. The estate agent can manage it for you, but they charge usually another 10%, and then they will use the vendors they want to which may not be the cheapest.

Thats it, we found it very simple

missile

We rented our property. It can be difficult to manage from overseas. We did employ an agent and took out maintenance contract but owner is still responsible.

One tenant phoned to say central heating would not work. We have a baby so we need an emergency repair. Try finding an electrician, Friday evening on a bank holiday weekend. One hour later another call, shouting, then tears. When the electrician got there, it turned out they had messed up settings on the time clock!

There are many things you need to consider, like tax should be deducted by tenant for overseas LL.
See here> http://www.direct.gov.uk/en/MoneyTax...me/DG_10013347
I would suggest you join http://residentiallandlord.ipbhost.c...ndlords-forum/.

cricketman

Yes there are annoying things. And your heart sinks when you get a call saying the boiler doesnt work (potentially very large bill).

Make sure you do your finances well to see if it is worth while. It is a fair amount of work and stress if the rent you'll be getting is say, only £500 per month, while if it were £2k per month, then it is easy money.

There are times when I wish I sold our place in 2007 when we left for Spain because firstly it was the peak of the housing market, and secondly we'd have saved the hassle over the past 4 years.

snikpoh

Personally, I think the best thing to do is to have a fully managed let where, if things go wrong, then the agent has to find the plumbers/electricians etc. This can cost around 9-10% but (in my mind) is well worth the extra.

If you have a decent agent, then they will have the forms to allow you to take the rent TAX FREE (ask for the green form).

They then notify the tax office and you pay the tax here in Spain - far more sensible.

missbad

Hi all

Thing is I am overseas but Gary will be spending most of his time in the uk.

cricketman

Sure it may make sense to some, but the management fee can be a huge chunk of the rent.

For example, in 4 years, we've done about £1,500 worth of repairs which includes a new washing machine and cooker and repairs to the boiler. All were very easy to fix as we use the same repairmen as when we lived in the flat.

4 years of management fees would have cost me £6,500 (at 10% of rent). So spending £6,500 to ask someone to arrange £1,500 worth of repairs is complete madness.

jackytoo

After a bad start (rented to friends of a friend!) we used an agent. In a decent market the extra fee can be factored in the rental price. We had a service contract for gas and electric. Anything wrong and the tenants only had to call them.

snikpoh

I agree but it's like insurance ....

Also, for 10%, we are covered for periods of no tenants i.e. we will always get rent!

missile

So where will Gary live?

fionamw

Know nothing about organising from Spain, but on a very specific note, a UK estate agent recently advised me most strongly to let UNFURNISHED and with NO WHITE GOODS (hot water boiler obvious exception) to avoid punitive costs/problems when something goes wrong. Even no cooker, he suggested.

cricketman

That's an excellent deal then!

missbad

He will be in the uk with the business and then coming over to spain once a month!

missile

My question was where will he live if you rent your property?

jay01

When we moved over here just over 12 months ago we looked at renting our house out, good area(St Albans) rental would have given us about 1200 a month on 2 bed bungalow, which we thought was ok, enough to live on but then you have to take everything off your income, agents fees as you live abroad ok not compulsory but recommended, property insurance as a rent out not as an owner occupier or you may find your insurance invalid, contingency plan for repairs (best to put a little aside every month than get a huge expense), tax on all income and not just after out goings, appliances have to be pat tested, electrics have to have a certificate as does the gas boiler, mortgage company has to know because they technically own your house and all the little bits and pieces that stack up (unpaid bills, someone has to pay them).

It worked out that in the end we would be getting about 500 a month so in reality not worth doing, also how ever good your agent is it is always a risk renting your house out, does not matter how many checks they do nothing can prevent redundancy, illness or plain wont pay then what do you do, take them to court to get them out (extra expense), repairs if they trash the place and all the heart ache if it is a treasured home.

In the end we sold the house invested the money and live off the return on the investment at least we can afford to live all be it modestly, but we have no worries regarding the house and no regrets for doing it.

Hope this helps if you do look at renting out you are best contacting as many companies as possible as their fees are all different and how much they think you will get will be different, but remember what they tell you, you can get may not be the real value of what you will get, check out companies as a potential renter first and for most, see what questions they ask and what references they ask for, see what properties are available and how much they are and how long they have been empty, the longer they have been empty the chances are they are charging to much and you only have 6 months (if it is totally empty) to not pay council tax, if you are renting out part furnished then you are still liable for council tax, so then it costs you money while sitting empty.

Take everything the agent tells you as questionable they want your money and not always fussy how they get it, if you have family close to the area of the house you may be best to have a client vetting clause so that you or your delegated representative has the last word on the tenant but some companies may take the huff with you for doing it.