Buy to Let

Purchasing a property as a Buy to Let?

Letting out a property is a business. You will look at yield - interest rates and the likelihood of the property being unoccupied are relevant. Capital appreciation is important. There can be issues over damage and deposits. Nowadays landlords are also coming under increasing legal responsibilities.  So, there can be a lot more to think about than just buying and finding a tenant. 

Our lender connections have led to our having an increased involvement in Buy To Let transactions, both purchases and re-mortgages. We act for a significant number of investors many of whom have multiple properties in their ownership and some of whom have portfolios in excess of 100. Changing vehicle from personal to corporate ownership is something we also deal with on a regular basis.

I want to 'Buy To Let' a property, what should I do?

Start by giving us a call on 0800 103 2600! 

Our property team will be able to guide you through the entire process but here are some of the questions we are often asked:

• How much stamp duty is payable on the purchase of a buy to let property?

  From 1st April 2016, anyone who owns more than one property is subject to an additional 3% surcharge on top of the stamp duty due. If this applies to you click here to link to the Inland Revenue’s Stamp Duty Calculator. This will help you understand the additional amount you’ll be required to pay. Alternatively, you can call us on 0800 103 2600 and we can do it for you.

• What documentation do I need?

  If you are mortgaging you need the following information and copy documentation:

  • ASTs;
  • Tenancy Deposit Scheme (TDS) and evidence of compliance; 
  • Electric and Gas Certificates;
  • EPCs; 
  • Copies of any consents required as stipulated in the deeds to the property;
  • Planning and Building Regulations;
  • Other relevant Local Authority consents.

  If you are buying (or selling) in addition to the above the seller also needs to provide: 

  • Proof that each rent is paid up to date and confirmation there have been no issues with the current tenant;
  • Sellers signed letter of authority instructing the tenant to pay the rent to the new owner.

• Can I advertise a property I’m buying after I exchange to secure a tenant before I complete?

  In principle you can. That way you will reduce the risk of the property standing empty for any length of time.

• Is sub-letting allowed in a buy to let property?

  If you wish to allow sub-letting then you’ll have to check the following to ensure you can do it:

  • Any covenants or stipulations contained in your deeds. If you have a flat or leasehold property it’s quite common to see a stipulation that you’re not allowed to sub-let or it may require the consent of the freeholder or original developer. There may also be a provision that a property can only be occupied as a single private residence which rules of a HMO;
  • Again, if you have a flat, any regulations that may be in place with the other flats and management company;
  • Planning permission or local authority requirements generally. Certain areas of towns and cities have strict conditions as to letting which can affect houses of multiple occupation and sub-letting;
  • The mortgage conditions to ensure the type of letting you propose is acceptable to the lender. 

• What is a house in multiple occupation (HMO)?

  Also known as a house share, it is a property that is rented to at least three people who are not from the same family, but share the facilities - the bathroom and kitchen for example.

• If I’m buying a house of multiple occupation what should I look out for?

  As a landlord, you’ll need to know whether the property has planning permission, a licence (if renting to more than three people in one property who aren’t family members, although this number changes depending on location) and whether there’s a fire alarm system to name a few. You should speak to a solicitor to understand exactly what you’ll need to check for as it can differ depending on the area on where you’re buying.

• Will Russell & Russell provide a written fee estimate for my buy to let property transactions?

  We always provide a written estimate at the outset of a transaction based on the information provided to us at that time, so that you know where you stand and to ensure that there's no misunderstanding between us at a later time. 

  In the case of residential property transactions, we are usually able to offer a fixed fee for our time.  We will quote a fixed fee for the work normally undertaken in a standard case and will provide you with a list of additional fixed fees that we would charge if you require additional work to be undertaken. Examples of this would be arranging a Title Indemnity Policy, preparing a Declaration of Trust or dealing with a Deed of Covenant. 

  We will always honour the fixed fee quoted unless the information relied upon by us at the time of the estimate was incorrect or it subsequently becomes apparent that there's an aspect of the transaction that will significantly affect the amount of time that has to be spent by us – in either case we will notify you of any such development before we proceed further. Examples of circumstances that might change the cost would be if the property is a flat, not a house as you initially informed us, if a lease extension is required or if the ownership is defective and remedial action is needed. For a free quote and breakdown of related third party fees (disbursements) known at this time, please use our quote enquiry form.

  In addition to receiving instructions direct from buyers and sellers, we also work alongside brokers, referrers and property agents who refer clients to us. If we have agreed to pay to them a referral fee for recommending us to act for you then we will disclose the amount to you and we will pay the amount involved to the referrer out of our fee.

• Will I have a direct contact number and email for my conveyancer?

  Yes, we will let you know the name and direct contact details of the person who is primarily dealing with your case when you become our client. That person will have support and also a Supervisor.

• What happens if I need to speak to someone out of normal office hours or at a weekend?

  We operate an out of hours, seven days a week service so you can speak to us in the evening or at weekend if you need to. The number to call is 07884 067 920.

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