#164

Should you look in or outside Article 4 areas for your HMO?

This episode featuring Nick Smith of Saltbox Living will help you decide.

The answer depends on your circumstances.

Are you investing for the long term or are you momnetum investing where you’re trying to replace an income quickly?

Nick has the knowledge, experience, wisdom to answer this question. His property story started many years ago after he bought seven buy to lets alongside his full time job working in the printing business in his native Yorkshire.

He also has nerves of steel. He once and immediately took on £5 million of debt to turn around a failing printing business.

Another Must Listen episode.

#163

One of the most frequently asked questions I get when listeners reach out is around expat mortgages.

Do you need a broker?

Does it matter where you live or who you work for?

What kind of bank account do you need?

Can you get a limited company mortgage, or should you buy in your personal name?

What are the rules around portfolio landlords? Today, Simon Allen of Searchlight Finance answers all these questions and much much more.

This is a repackaged compilation of Episodes 15 & 16, first released in 2022.

During the episode we discuss:

- Expat Mortgage Application Process

- Different Types of Expats and Their Mortgage Qualification Criteria

- UK passport holders living abroad

- Foreign nationals with overseas passports

- Lenders Criteria for Expats and Complexity

- Countries of residence and work

- Credit history

- Types of properties for personal or limited company names

- Income Declaration to HMRC for Mortgage Approval

- Income within a limited company

- Requirement for taking a salary or providing a set of accounts

- Preparation for Remortgaging

- Timing and paperwork

- Lender selection process

- Overcoming Anti-money Laundering Regulations

- Working with specialized brokers and lenders

- Importance of a good credit file and experienced solicitors

- Importance of Speed in the Purchase Process

- Staying on top of the process with a solicitor

- Information Needed for Mortgage Decisions

- Decision in principle

- Requirements for new and existing clients

- Correspondence Address in the UK and Its Significance

- Dual representation in conveyancing

- Need for independent legal advice with limited company borrowing

- Proof of Funds and Source of Funds

- Proof of deposit

- Minimizing frequent financial transactions and emails

- Additional Fees for Expats and Foreign Nationals

- Minimum values for loans

- Differential treatment by lenders

- Considerations for Couples with Foreign National

- Role as a shareholder and not a director in a limited company

- Impact of Broker Experience and Focus

- Buy-to-let market expertise

- Documentation process knowledge

- Technology Challenges and Communication Issues

- Delays and difficulties with remote working

- Valuations for Complex Property Types

- HMOs and multi-units

- Varying criteria based on the lender

- Tax Treatment and Portfolio Growth for Expats

- Limited company mortgages' tax treatment and rates

- Challenges with portfolio growth and transitioning

- Considerations at the End of Fixed Terms

- Product transfers offered by some lenders

- Challenges of remortgaging for expats returning home

Keywords:
Expat mortgages, expat mortgage brokers, residency requirements, limited company mortgages, UK passport expats, foreign national expats, lender criteria, expat finances, property types, income declaration, limited company salary, remortgaging, anti-money laundering regulations, specialized expat brokers, credit file, expat solicitor, expat lenders, decision in principle, correspondence address, dual representation, conveyancing solicitor, documentation process, proof of funds, remote working, HMO valuations, limited company tax treatment, HMRC income declaration, portfolio growth challenges, product transfers, expat return remortgage.

#162

Did you know that commercial property usually cost less per square foot to buy than residential?

This can make commercial property a very attractive option if you’re looking to develop HMOs. And often the location of commercial stock is ideal for this strategy.

But commercial HMO conversions come with their own unique sets of risks and concerns. This episode tells you all about them.

Timothy Witt has done around 40 projects with various business partners both for himself and clients. Many of these projects were HMO conversions, so he has lots of tips, tricks and tactics to share.

During the episode, we discuss:

- Converting ground floor to commercial and upper floors to residential HMO

- Converting building to multiple commercial units

- Permitted development rights for commercial to residential conversions

- Minimum space standards and challenges

- Two-stage process of converting to residential first and then to HMOs later

- Types of mortgage needed for property with commercial space and HMOs

- Thorough financial estimation for build costs, finance costs, final rents, and final GDV

- Balancing the risk of conditional and unconditional planning approval

- Addressing objections for HMO projects

- Role of planning consultants in enhancing chances of successful planning approval

- Assessing lease terms and exploiting underutilized areas

- Zoning system for commercial valuation predictions

- Effect of zoning systems on yields and property value

- Mitigating risk in property investing

- Higher rewards with higher risks in property investing

Keywords

Property development, Commercial property, Residential conversions, HMO, Permitted development rights, Minimum space standards, Mortgages for commercial space, Lease improvement, Rental income, Financial estimation, Conditional planning approval, Planning consultant, Value addition, Refurbishments, Bridging finance, Cash flow, Zoning system, Manchester, property investment, Warren Buffett, Robert Kiyosaki, Planning approvals, Objections from neighbours, Market changes, Utility bills, Interest rates, Article 4 zoning, Property values, Yield restrictions, Commercial agents, Property investing risks

#161

Starting with the end in mind is a familiar theme in UK property investing, but it’s not as easy as it sounds when it comes to tax planning.

For this episode, we’re going back into the archives to remind new listeners and refresh the memories of the rest of you about the importance and detail behind one of the most frequently asked questions of UK property investors:

Should you buy UK property in your own name or through a limited company?

We’ll also be having another look at group structures, and we’l be tapping into the knowledge and experience of long time friend of the pod, Sean the Property Tax Accountant.

Sean is a fully qualified Chartered accountant and an expat property investor.

So he knows what he's talking about!

During the show, we discuss:

- The importance of defining financial goals early and considering future changes

- Capital gains tax and dividend tax implications

- Comparison of tax amounts for limited company versus personal ownership

- Considerations for personal ownership versus passing properties to children

- Special purpose vehicles (SPVs) and their significance

- Separate companies for different property investment strategies

- Benefits of group structures for tax efficiency and property transfers

- Overview of Section 24 changes on rental income and mortgage interest

- Explanation of the 20% tax credit given for mortgage interest paid

- Implications for landlords and tax bills for high rate taxpayers

- Age, long-term plans, future income, and reinvestment of profits

- Reinvestment of profits and potential benefits for higher rate taxpayers

- Changes in corporation tax rates and their influence on decision-making

- Concept of holding company and subsidiary companies

- Flexibility in implementing new property strategies

- Simplifying asset transfers to children through shareholding in the holding company

- Importance of setting up the structure correctly from the start

- Seeking HMRC clearance for genuine commercial reasons

- Consultation with advisors before property transactions

- Decision-making between personal name and limited company ownership

- Impact of Section 24 on high rate taxpayers

- Significance of income tax thresholds and implications for rental income

Here is the Marginal Relief Calculator for Corporation Tax for profits of between 50K & 250K

Keywords:

property investment, limited company, capital gains tax, dividend tax, personal ownership, inheritance tax, limited company structure, special purpose vehicles, SPVs, group structures, tax-efficient property transfers, Section 24 change, rental income, mortgage interest, corporation tax, high rate taxpayer, reinvesting profits, holding company, subsidiary company, HMRC clearance, genuine commercial reasons, upside-down tree structure, passing on assets, shareholders, property tax accountant, UK property, income tax thresholds, rental income calculation, property investment portfolio, tax implications

#160

Do you know what Sideways Loss Relief is?

How about the Annual Investment allowance mechanism?

And what do they have to do with Capital Allowances?

Are you familiar with the deadlines for making a Capital Allowances claim and how to find out if they’ve been claimed before without alerting a vendor to the fact that they could make a claim.

This episode covers all of this and lots more including how to use Capital Allowances as a strategic tool for growing your UK property portfolio.

This is the second instalment of a two-part special on Capital Allowances featuring CA expert Arthur Kemp of Exact Capital Allowances.

If you haven't already done so, listen to last week's Episode #159 first.

In this week's episode, we discuss:

- Differentiation of capital allowances from regular tax deductions

- Explanation of what constitutes plant and machinery within a property

- Breakdown of plant and machinery into constituent parts for valuation purposes

- One-time claim for capital allowances on a building, regardless of subsequent changes in ownership

- Identification and examples of new expenditure that qualifies as capital expenditure

- Impact of specific property enhancements, such as creating new bathrooms or extending the kitchen, on capital allowances

-Clarification on the eligibility of different types of property activities for capital allowances, including HMOs, serviced accommodations, and holiday lets

- Emphasis on the need for specialists due to the complexity of valuation and specific knowledge required

- Differences between regular accountants and specialists in capital allowances

- The importance of understanding if the previous property owner has already claimed any capital allowances

- Explanation of the role of CPSE inquiries and section 198 election in commercial property transactions

- Significance of leading questions to identify whether the previous owner has claimed capital allowances in residential properties like HMOs or holiday lets

- Clauses in the sales contract that establishes the seller's agreement with regard to capital allowances value within 2 years and disclosures to HMRC

- Importance of utilizing capital allowances strategically to reduce tax liabilities and reinvest in more properties

- Flexibility of transferring capital allowances to offset tax liabilities for corporation purposes or against PAYE income

- Discussion of the option to use capital allowances to offset tax from other sources of income or roll it forward to future profits

- Negotiation process with the new owner regarding the value and use of the claimed capital allowances

- Recognition of the 2-year deadline for making necessary disclosures and claiming capital allowances, with different rules for residential and trading properties

- Importance of understanding the rules and implications of selling a property with claimed capital allowances

Keywords

capital allowances, UK property investment, HMRC, property assessment services, tax savings, plant and machinery, expats, property owners, Exact Capital Allowances Limited, trading HMO, serviced accommodation, commercial property, tax liabilities, sideways loss relief, income tax, holiday lets, qualifying activities, CPSE inquiries, section 198 election, sales contract, disclosures to HMRC, corporation purposes, PAYE income, specialists in capital allowances, valuation, plant and machinery valuation, capital expenditure, building ownership, property items, previous owner, tax relief

#159

You’ve probably heard about Capital allowances. You might even know something about this generally little known area of tax relief. But I’m sure you’d like to know more, right?

If you have Commercial property, Serviced Accommodation or even HMOs, then it’s definitely worth your while listening to this two-part special on Capital Allowances because it could save you thousands of pounds. And who wouldn’t like that?

Not many people know more about Capital Allowances than Arthur Kemp of Exact Capital Allowances so, you'd be well advised to listen now as we discuss:

- Types of properties that qualify for capital allowances

- Discussion on the legislation surrounding capital allowances

- The distinction between dwelling houses and non-dwelling premises

- Qualification of commercial properties, serviced accommodations, and HMOs

- Case law and challenges related to HMO properties and capital allowances

- Identification of second fix items

- Examples of items that qualify for capital allowances

- The exclusion of structural elements from capital allowances

- Specific items that can be claimed including lighting, heating systems, security, soft furnishings, and more

- The confusion around claiming capital allowances in HMOs

- Differentiation between common areas, communal areas, and dwelling areas

- Eligible items for claiming in common areas and the challenges in the HMO sector

- The value of installations and services to the entire property

- Historically changing interpretations and the impact of case law on claiming capital allowances in HMOs

- Potential changes in legislation

- Details about recent spring budget (2024) changes and its implications

- The potential impact on holiday lets and the capital allowances for such properties

- Perspectives on the likelihood of retrospective amendments and implementation of potential changes

In Part Two (Episode 160) we’ll be discussing:

- Deadlines for applications and strategic use of capital allowances

- The mechanism of the annual investment allowance

- The role of capital allowances in building a more profitable UK property portfolio

Keywords:
Expat Property, Capital Allowances, Tax Relief, Commercial Property, Serviced Accommodation, HMOs, Tax Saving, Special, Guests, Arthur Kemp, Ideal Housemates, Kim and Aggie, Carol Vorderman, Boris Johnson, Peace and Quiet, Property Tour, Measurement Tool, Whatsapp Video, Tax Return, Legislation, Dwelling House, Communal Areas, Common Areas, Plant and Machinery, Second Fix Items, Short Term Rentals, Furnished Holiday Lets, Case Law, Spring Budget, Tax Simplification, HMRC

#158

Is social housing a business model that interests you?

Do you understand how it works?

Would you like to know how to go about building a portfolio based on providing housing for vulnerable people in all their shapes and sizes?

Have you thought about the advantages and disadvantages? Are you wondering if this might be the way forward for you?

Scott Grayson is a property veteran with more than three decades of experience so he's well placed to answer these questions!

During the episode, we discuss:

- The process and considerations for building a social housing HMO portfolio

- Collaboration between property investors and care providers

- Lease duration and the importance of quality renovation work

- Safety standards and the need for correct certifications

- Details about full repair and insurance (FRI) agreements

- The importance of maintenance and care provider relationships

- Selecting the right property for social housing

- The role of mentors, housing associations, and support teams

- Comparing returns on investment for social housing HMOs and other property investments

- Advantages of the set and forget strategy, guaranteed income, and lease security

- Positive impact and rewards for those involved in the social housing environment

We typically work with time poor professionals get a good return on their money by investing with us. To schedule a call to discuss

Leave an honest review of Expat Property Story
Join our Mailing List to join our WhatsApp group AND access our 37 Question Due Diligence Checklist AND our 23 Step Guide to Buying Property at Auction AND our Monthly Newsletter
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Tell us the one thing you’re struggling with in UK property

As a reminder, here are the details of where to meet other Expat Property Investors (For FREE!!!):

Hong Kong: The Urban Bakery in the Landmark Building in Central on the first Saturday of each month from 11:30 am

Dubai: Holiday Inn, Science Park on the first Wednesday of each month (from 7pm

Singapore: The Providore at VivoCity on the first Saturday of each month from 10:30 am

Keywords:

social housing, business model, portfolio, housing, vulnerable people, advantages, disadvantages, HMOs, high cash flowing assets, remote investors, standard buy to lets, student HMOs, coliving HMO projects, social housing HMOs, property veteran, care sector, Winston Churchill, Pep Guardiola, Stevie Wonder, leadership, mentorship, rental income, lease, planning permission, housing associations, registered provider, local authority, refugee schemes, investment strategy, guaranteed income, cash flow management, positive impact

#157

You may have heard people talking about sustainability, Net Zero, future proofing, institutional funding, socially conscious investing, Environmental and Social Governance or ESG and thought what’s it all got to do with me as an expat property investor.

Well hopefully, after listening to this week’s show, you’ll be a little closer to finding out.

Anna Clare Harper is an expert in sustainable property investment and co-founder of Green Resi which helps institutions to future proof and grow UK residential portfolios.

In fact she’s so knowledgable about sustainable portfolio building that not only has she written three books about it, but she’s regularly invited by the likes of The Financial Times, Forbes and the BBC to give her opinion on the subject.

Anna also hosts a podcast: The Return of Anna Clare Harper.

During the show, we discuss:

- Increasing interest in sustainable property investment

- Impact of regulations on the private rental sector

- Shift towards professionalization and regulated bodies

- Political will to improve property standards and reduce non-decent homes

- Potential decline in part-time landlords due to regulatory challenges

- Supply-demand imbalance and housing shortage caused by new regulations

- Effect of regulations on housing stock availability and rental market

- Institutional investors and pension funds' interest in professional portfolios with sustainable features

- Introduction of net zero emissions and focus on existing homes and construction

- Skills gap in retrofit and shortage of rental housing

- Rollback on regulations and issues with EPC ratings for retrofitting

- Practical challenges and skills shortage in achieving net zero

- Importance of diagnostic assessments and practical skills for energy-efficient buildings

We typically work with time poor professionals get a good return on their money by investing with us. To schedule a call to discuss

Leave an honest review of Expat Property Story
Join our Mailing List to join our WhatsApp group AND access our 37 Question Due Diligence Checklist AND our 23 Step Guide to Buying Property at Auction AND our Monthly Newsletter
Follow the Show on Instagram
Tell us the one thing you’re struggling with in UK property

As a reminder, here are the details of where to meet other Expat Property Investors (For FREE!!!):

Hong Kong: The Urban Bakery in the Landmark Building in Central on the first Saturday of each month from 11:30 am

Dubai: Holiday Inn, Science Park on the first Wednesday of each month (from 7pm

Singapore: The Providore at VivoCity on the first Saturday of each month from 10:30 am

Keywords:

sustainability, net zero, ESG, socially conscious investing, property, sustainable property investment, Green Resi, regulations, EPC ratings, cost exemptions, professionalization, section 24, private rental sector, net zero environmental requirements, landlords, institutional investors, pension funds, supply-demand imbalance, housing shortage, vacant homes, housing stock, property taxes, professional capital, Green Resi, EPCs, net zero emissions, minimum energy efficiency standard, retrofit, skills gap, shortage of rental housing, apprenticeships