BTL query

[OpenToSuggestions]

Hi all.
I am in my early 30s. I overpay my mortgage and now some loans have cleared I am in the position where I can invest.

One of the routes is a buy to let (BTL) property, with the plan of splitting things down the middle with my brother. It would be a year or so until we had the required 25% deposit.

Following a light/medium level of research it has become clear that the newly imposed tax laws completely shaft landlords.

A summary of which can be found here:
https://www.moneysupermarket.com/landlord-insurance/buy-to-let-tax-relief/

Is it even worth buying a house to let out anymore? Both myself and my brother would be getting slammed for 40% tax.

I don't mind if it doesn't make a monthly profit, but the thought that I could be in an annual shortfall makes me question whether the hassle is worth it. The intent is that I am young enough that by the time I am 60 the house would be mortgage free.

I wondered what my fellow OcUKers thought?

 

[BUDFORCE]

You make money in the long term by appreciation.

Also and I very much could be wrong, but I thought the tax thing didn't apply if it was only 1 BTL?

If not just do what everyone else does which is setup a limited company, and purchase the property with that, then you run it as a business and only pay corporation tax on any profit.

 

[Destination]

Tax thing applies if you have only one buy to let.
The tax doesn’t apply to the big rich ******* who have hundreds, it is a farce.

Buy the house, but by it using a limited company which you and your bro setup as your investment company.
Then the tax thing doesn’t apply.

 

[BUDFORCE]

Tax thing applies if you have only one buy to let.
The tax doesn’t apply to the big rich ******* who have hundreds, it is a farce.

Ain't that the truth.

 

[tom_nieto]

Buy the house, but by it using a limited company which you and your bro setup as your investment company.
Then the tax thing doesn’t apply.

This is sound advice and might help if you want to buy one another’s share out or invest further.

Having had this thought recently, we decided it wouldn’t be worth buying a BTL property. Did the accidental landlord thing when I moved, it made a small amount of cash. It caused huge headaches and the money would have been just as well invested in something like Vanguard.

The return every month just isn’t worth it unless you have loads of properties and speculating on capital gain is risky unless you are very confident with the market or know a really good team of builders and buy fixer uppers.

 

[chroniclard]

Not necessarily about making money each month, long term its about getting someone else to pay the mortgage for you.