Tips for selling your rental property in London
In the past few years, landlords haven’t had an easy ride. Many statutes have been implemented that have trumped hard on the landlords’ heads.
From Section 24 of the Finance (No.2) Act to the Stamp Duty Surcharge to the strict Energy Performance Certification requirements, the regulatory restrictions surrounding this sector have made many investors consolidate their buy-to-let holdings to reduce their exposure.
Others who are completely frustrated by the disruptive changes have opted to sell their properties and exit the market.
Unfortunately, selling a rental property can just be as challenging as managing one. If you’re looking into selling your rental property, we’re here to help. This post will explore some handy tips and tricks that will make the process easier.
1. Figure Out the Right Price
Pricing is very important when it comes to selling your rental property.
A high price may deter buyers causing your property to stay longer in the market while a low price may make you lose big on capital gains.
The trick is to hit a sweet price spot that will give you significant capital gains without putting off buyers. Research comparable rentals in your neighborhood that have sold recently to get a rough idea of an ideal price for your property.
If no rentals have sold out recently in your area, you could observe real-time property valuations of comparable properties on sites like Property Price Advice, Mouse Price, and Nethouseprices. You could also use the pricing tools integrated into property websites like Zoopla.
2. Decide Whether to Sell with Tenants in Situ
This is a big choice to make, and one that could have legal consequences.
If you decide to sell the property with tenants in situ, you’ll need to know your eviction rights as a landlord as well as the tenant’s rights. If the tenancy permits, you can evict the tenants using a Section 21 or Section 8 Notice.
If not, you may have to wait till the tenancy ends, then sell the property with vacant possession.
Weigh both options heavily as each comes with its own pros and cons. Once you’re ready to sell, you could use the services of a property buying company that property buying company that helps Londoners sell their homes fast and get a guaranteed offer with no fees to pay.
3. Understand the Capital Gains Tax
Before you make a move to sell your property, it’s important to first understand all the legal laws governing the sale of rental property and the taxes therein.
It’s important to note that if you sell your rental property for profit, you may be liable for capital gains tax. But whether the profits are taxable or not depends on how you have used the property.
For instance, if you’re selling a property that is your main residence, then you may not be required to pay capital gains tax. However, if you’re selling a property that you have either moved out of before selling or have rented out, then you’ll be liable to pay capital gains tax.
4. Notify Your Mortgage Provider
If you haven’t cleared the mortgage on your rental property, make sure to notify the mortgage provider of your intention to sell the property.
Doing so is important for the release of the title among other reasons. Ask the lender for the remaining balance and let them know whether you intend to clear the balance from the proceeds of the sale or transfer the mortgage over to a new rental property.
We hope these tips will help you sell your rental property fast and with ease. Feel free to comment and share.
