The primary focus when selling a buy-to-let is achieving the maximum price.
Landlords need to make their best effort to present as decent a product as possible. My advice, think Housedoctor, think clean, tidy and light. It's all about maximising the sense of space.
In terms of decoration it's usually best to keep things safe and neutral so that it appeals to the widest market, whether that be other landlords/investors looking for something that will easily rent out or for residential buyers wanting a home.
Statement wallpaper or outlandish patterned carpets don't tend to be to everyone's taste, so my advice is simple - light, bright and preferably white.
It's worth sorting out any repairs that need doing. Fill and paint any rotten window frames, repaint walls, unblock gitters, tidy any outside spaces /gardens/ driveways, and replace tired old carpets with something neutral and cheap. These carpets only need to look good for the few months of the sales process.
All that said, this simple formula is very much a generalised view, and certain property markets might require slightly different approaches. Landlords need to identify and understand their target buyer, then act accordingly.
Different properties in different areas are going to require different treatments to achieve their maximum price. If a landlord is unsure it's worth then consulting withlocal estate agents on what to do to maximise values before spending on any innapropriate refurbishment.
In terms of timing, spring is a good time to market a buy-to-let property. Buyers traditionally start surfacing in February, so if a landlord is under no specific time pressure to sell, it's a good time to aim for dropping a BTL onto the sales market.
Selling a buy-to-let property brings a potential capital gains tax liability.
If a landlord has lived in the rental property for a period of time they may be entitled to the Private Residence Relief (PRR). PRR is a great way of mitigating some capital tax liability, and landlords who has lived in their buy-to-let at some stage will be eligible to Lettings Relief of £40,000.
Download the Government's guidelines on Private Residence Relief
A landlord who has never lived in their buy-to-let property may not be able to claim any PRR but they still have a number of allowances available to set against their capital gains tax liability.
The big one is obviously their personal capital gains allowance. This is an annual allowance availiable to everyone. In the tax year 2014-15 it stands at £11,000, and tends to rise each year, roughly in line with inflation.
A landlord will need to make sure that they claim all their expenses in relation to any capital costs relating to improvements to the property.
For example, if they have improved the property through an extension, loft conversion along with the original costs of acquisition and disposal such as legal and estate agent fees.
Read more about a landlords’capital gains liability
The size of any Capital Gains Tax bill will be dependent on how much the property has gone up and how much money has been spent on its development over the years. I have a property that was purchased for £83,000 back in 2005, that has probably cost me the best part of £20,000 to do up and yet is still onlu worth a little over £100,000. One positive about this poor performing property is that I would have little to no CGT liablility if I came to sell it. ( every cloud has a silver lining ).
This might be the case for many of us northern landlords, whereas, London landlords are fortunate enought to be cursed with sky high CGT liablilities ('you poor things' - sympathy spat from between my bitter, pursed northern lips)
Those landlords blessed with Capital Gains Tax liabilities will need to work out their base costs and claim fully for all their allowances and deductions to minimize their potential capital gain liability on disposal of the property.
This is an interesting one.
The reality is that residential property despite some ups and downs continues to outstrip inflation.
The house price data from Nationwide indicates that since 1975 UK residential property has out-gunned inflation by 2.9%. Not bad in any investors books, and this of course doesn’t include any rental profits during this period, nor factors in the gearing of borrowing to ratchet up these returns.
All in all, residential property has made a very good long-term hold and I personally see no reason it won't continue to do well in comparison to other investements - although nobody can predict quite what's around the corner and all investments are a gamble.
I'd advise landlords who do want to realize their investment to take time to think carefully before selling. Their might be a large capital gain sat there but remember BTL property is an asset that keeps giving, unlike a yacht or a Porsche or whatever you might want to splash your sale profits on.
FORMS FOR LETTING PROPERTY
FINANCE AND TAX ON RENTAL PROPERTY
RENTAL PROPERTY REGULATIONS
FURNITURE AND FURNISHINGS
HMO (HOUSE IN MULTIPLE OCCUPATION)
TENANCY DEPOSIT SCHEME (TDS)
ENERGY PERFORMANCE CERTIFICATES
COMMUNAL HEATING REGULATIONS
INVESTING IN BTL PROPERTY
A GUIDE FOR NEW LANDLORDS
WHICH PERIOD OF PROPERTY
BUYING OFF PLAN
KNOWING THE RISKS
PROPERTY INVESTMENT CLUBS
MANAGING RENTAL PROPERTY
GIVING NOTICE TO LEAVE
NON - PAYMENT OF RENT
GETTING YOUR MONEY BACK
THE TENANT WONT MOVE OUT
THE TENANT DOES A BUNK
RAISING THE RENT
REDUCING THE RENT
REPAYING THE TENANCY DEPOSIT
FAIR WEAR AND TEAR
MOULD AND CONDENSATION
MAINTENANCE OF A RENTAL PROPERTY
LETTING RENTAL PROPERTY
TEN STEPS TO LETTING
WRITING A LETTING ADVERT
FURNISHING A PROPERTY
LETTING AGENT OR DIY
SELECTING A LETTING AGENT
TENANTS ON BENEFITS
LETTING TO STUDENTS
PREPARING AN INVENTORY
RIGHT TO RENT GUIDANCE
TERMS OF A TENANCY
LENGTH OF A TENANCY
RESPONSIBILITY FOR REPAIR AND MAINTENANCE
TENANCIES IN SCOTLAND
LETTING TO TENANTS WITH PETS
LEGISLATION OF LETTING PROPERTY
TENANCY DEPOSIT DISPUTES
ALTERNATIVE DISPUTE RESOLUTION
HOUSING ACT APPEAL DISPUTES
THE LANDS TRIBUNAL
RIGHTS OF LIGHT APPLICATION
APPEALS FROM LEASEHOLD VALUATION TRIBUNALS (LVT's)
POSSESSION - SECTION 8 NOTICE
POSSESSION - SECTION 21 NOTICE
SECTION 21 TIMETABLE AND PROCESS
GROUNDS FOR POSSESSION
PREPARING FOR A POSSESSION HEARING
HARASSMENT BY LANDLORDS
RENT DISPUTES BETWEEN LANDLORD & TENANT
FAIR RENT (RAC)
MARKET RENT UNDER AST
LEASEHOLD VALUATION TRIBUNALS
MODIFICATION OF RESTRICTIVE COVENANTS