Owning a Second Property- what to consider

Owning a Second Property- what to consider

Owning a Second Property- what to consider:

​It is estimated that around 10% of home-owners have a second property, either to use as a holiday home or as a rental property.  If you are looking to purchase an additional property, that won’t be your main home, here are the key things to consider:

  1. If you are purchasing with a mortgage you will need to make sure that the mortgage product you have is suitable and that the lender knows what you plan to do with the property. Be aware that a common feature of buy to let mortgage offers is the requirement that any renter be independent i.e. not family.
  1. Stamp Duty Land Tax (‘SDLT’) will be more expensive. On a first property purchase you will not pay any SDLT on the first £125,000.  From £125,001 to £250,000 you will pay 2% and as the purchase price increases so does the percentage payable, in small increments.  With a second property you will pay an additional sum on top of the typical SDLT payment.  Meaning a £400,000 purchase goes from £10,000 to £22,000.
  1. There will be tax implications on sale with Capital Gains Tax likely being due. This is an area that you will need to discuss in detail with your accountant.
  1. It has been reported that the seaside town of Whitby in Yorkshire is looking to pass legislation that reduces the opportunities for investors to purchase holiday homes/ second homes. It is worth noting that not everywhere will welcome a resident that only comes when the sun shines.
  1. If you are looking to rent the property out (to long or short term tenants) you will need to be prepared to meet the costs of running the property during any time it is empty. These costs can rack up quickly: council tax, gas and electricity plus any insurance.  If you have insurance (which will be a requirement of any lender if you purchased with a mortgage) you will need to make sure you can visit the property regularly or hire help to assist you as the insurer will want to make sure no post has built up at the door (fire hazard) and that pipes haven’t burst during any cold spells.
  1. As a landlord you have safety obligations that you must fulfil- you must fit and test fire alarms and carbon monoxide alarms.  Every year all gas installations (boiler, cooker, gas fire) must be checked and serviced.

Having a holiday home is a great luxury but if you are not fully aware of the reality it can ruin the dream.

If you have any questions about renting out your property or purchasing a second home please contact the team on 01206 577 676 or email [email protected]

For more information on owing a second property

Contact us by calling 01206 577676 or you can email [email protected]

Alzheimer’s Society – Forget Me Not Appeal

Alzheimer’s Society – Forget Me Not Appeal

Alzheimer’s Society with their Forget Me Not Appeal.

​Throughout the month of June, the Private Client team at GoodyBurett will be spreading awareness and raising funds for Alzheimer’s Society with their Forget Me Not Appeal.

The team know first-hand how important support and understanding is to not only those living with dementia, but their carers and loved ones. The team assist and advise clients and their families almost every day on matters of capacity.

The Forget me not Appeal was launched by Alzheimer’s Society in 2021 after an increase in their demand for services during the pandemic. Those individuals living with dementia, their carers and family often feel they are forgotten or cast aside.

This is something that the team know too well and understand it can be a challenging time for our clients and their family. But by taking advice at the earliest opportunity is most beneficial. The team fully appreciate that each individual client has their own unique circumstances, and they ensure they can adapt to all the client’s needs.

Our Solicitors are qualified Dementia Friends and are always looking into ways as to how they can promote a dementia friendly society by raising awareness and understanding within the community. They feel that it is important to spread information and awareness to those affected by dementia, that it is always beneficial to obtain legal advice on Wills, Lasting Powers of Attorney and matters surrounding Court of Protection.

The team will wear their Forget Me Not badge with pride this June to honour our clients and their families affected.

If you would like to know more about how the team can support you or your loved ones, please feel free to contact our Private Client team at the Colchester office on 01206 577676 or any email enquiries can be sent to: [email protected]

For more information on how we can help

Please feel free to call our office on 01206 577676 or you can email [email protected]

Changes brought by the Leasehold Reform (Ground Rent) Act 2022

Changes brought by the Leasehold Reform (Ground Rent) Act 2022

Changes brought by the Leasehold Reform (Ground Rent) Act 2022

If you are a leaseholder or if you are considering purchasing a leasehold property, keep reading.

The Leasehold Reform (Ground Rent) Act 2022 comes into force on 30th June 2022 and brings with it major changes to the rules governing ground rent and lease extensions. The Act is part of the government’s plan to make leasehold properties more affordable and fairer. In effect the Act will prevent the Freeholders from charging more than a ‘peppercorn’, also know as ‘zero’, ground rent on all new residential long leases granted after the Act comes into force. This new rule equally applies to lease extensions, effectively bringing the ground rent to a ‘peppercorn’ as it would with a new statutory lease. However, for lease extensions, the ground rent will be set at zero once the period for the new lease starts and will not have effect immediately as it would in the case of an all-new lease. Therefore, you will still be liable for the ground rent set in the old lease until the new period added to the lease by the extension commences.

The Act does not affect any short-term tenancies, business leases, community housing leases, home finance leases or any leases that are already in existence. Nevertheless, from 1 April 2023 the rules set in the Act will also apply to retirement properties.

Freeholders need to be careful when granting new leases and/or extensions as the Act brings with it strict penalties of up to £30,000 if Freeholders are still charging ground rent or any administration fees for collecting the ground rent after 30th June 2022. Developers need to be equally aware of the new rules if they intend to sell the properties as separate leaseholds and grant new leases as it is crucial to ensure they are compliant with the Act.

If you are looking to buy a new leasehold property or to extend your existing lease or you would simply like to know more about how the new rules affect you, please contact our Conveyancing Team. You can call us on 01206 577676 or send us an email at [email protected]

For more information on leasehold property

Contact our Colchester office on 01206 577676 or you can email [email protected]

Does the snail still prevail?

Does the snail still prevail?

Does the snail still prevail?

A recent case prompted me to look further into the new rules as to how the court send out any application for divorce.  Until relatively recently, all applications for divorce had to be sent on paper to the regional divorce centre at Bury St Edmunds.  Once the family court went ‘on-line’, although the application required the receiving party’s e-mail address and used to communicate with users via e-mail, the court still used to send out the divorce petition by Royal Mail, (snail mail??).  This was their default method.   If you wanted the other person to receive the papers in any other way, you had to make an application.

Most people now want to receive documentation by e-mail – it’s  paperless and its immediate.  Have the court moved with the times and changed this default method of service? Has the introduction of the new DivorceDissolution and Separation Act 2020 made any difference?

Yes and no.

It is important you provide the respondent’s e-mail address so the court can serve documents to them by e-mail.  They will receive all correspondence via email.   You have to make sure it is not your own e-mail address and is nor is it the other person’s work e-mail address.   It needs to be their usual personal e-mail address.   If you don’t give an e-mail address,  the papers will be served by Royal Mail paper post which of course will take longer.

But, although the court say that all correspondence is sent by e-mail, you still have to provide a postal address too, for two reasons.  First,  so the court legal staff or judge can see whether or not the person receiving the application lives within the jurisdiction of England & Wales; secondly,  so that in addition to sending the application for divorce by e-mail, the court can also send out a paper version of the Notice of Proceedings.  If the court just sent the application out by e-mail alone and it had gone into a junk or spam box, it could go unnoticed, so the court have to do their best to bring the application for divorce to attention.

If you can only provide an e-mail address, you’ll still have to make a separate application to the Judge requesting the court’s permission to serve by e-mail only.  Separate application…….another court fee……delay…….best avoided if at all possible.

See a solicitor and get it right first time.  Contact Susan Devereaux, our Family Solicitor for more information and advice.

Our Family Team are available for appointments so please do give us a call on 01206 577676.

Any email enquiries can be sent to [email protected]

For more information on Divorce or any family matters

Contact us by calling 01206 577676 or you can email [email protected]