Month: May 2021

How to Maximise Your Investment as a South Devon Landlord

This three-minute read guides South Devon landlords to declaring their rental income in the best way possible.

If you rent out a property and receive a rental income from that, you must declare it. You have to pay tax on any profit. It doesn’t change your employment status to ‘self-employed’ though, as it’s considered an investment.

Of course, HMRC can be more complicated than a day at Hogwarts. The best advice will be to seek professional advice from an accountant but we’ve picked out some key points to start you off.

Start hoarding

HMRC unimaginatively call this ‘record keeping’. Be disciplined and keep receipts, bank statements, invoices, rent books, even mileage logs, so you (or your accountant) can easily make the deductions against your tax bill. This means you get to keep more of the profit away from ‘the tax man’ in a legal and ethical way, of course.

Expenses claims

There are a range of other allowable expenses. They are deductible only if they’re exclusively for renting out a property and if you pay for them yourself. This could include:

• Water, council tax, electricity, and gas
• Insurances
• Services of, for example, cleaners or gardeners
• Accountancy fees
• Ground rents
• Service charges

Maintenance and repairs

The definition from the gov.uk website is: ‘A repair restores an asset to its original condition, sometimes by replacing parts of it’.

If the property requires new guttering after a storm, this would be considered a repair and therefore, a deductible expense.

However, if you wanted to improve the guttering for another reason, like changing the colour, this would not be allowable.

Improvements are not an allowable expense, like replacing a laminate kitchen work surface for granite. The exception to this is updating things to their ‘nearest modern equivalent’. This could be things like changing single-glazing to modern, double-glazed windows.

If you replace an item with an upgrade, then you can claim the cost as if you had replaced like-for-like. Take the work surface example: a 2m length of laminate would be £150. The same size granite work surface could be £600. You could claim the £150, not the £600.

Domestic item replacement

Furnishings like carpets and curtains are likely to be able to be deducted, as long as you’re replacing like-for-like. Beds and free-standing wardrobes, or other items that can be considered ‘movable furniture’ are also deductible. Appliances, such as TVs or fridge/freezers, and even smaller items, like cutlery and crockery can be offset against your income.

Partial expenses

If you’re letting a property that you have a mortgage on, you can’t deduct the full amount of the mortgage payment. You can only offset the interest element of the mortgage repayment against the income. Similarly, if you use your car for a purpose related to the rental property, you can only deduct the vehicle running costs for that particular purpose. This includes mileage rate deductions.

For rental opportunities in South Devon, get in touch with us on 01626 365055. Our lettings specialists can help you consider the market and the best options out there for you.

© Chamberlains 2021

Seven Ways South Devon Residents Can Avoid Cowboy Builders

In this three-minute read, we look at how South Devon homeowners can protect themselves from unscrupulous builders.

We’ve all heard the renovation horror stories. The builder who does a runner halfway through a job, leaving a homeowner out of pocket and living in a construction site. The messy contractual dispute that winds up in court and ends in tears. Or the new roof that leaks at the first drop of rain.

The good news is that by following a few simple steps, South Devon property owners can avoid getting ripped off.

• Online research

Many websites offer consumer reviews and information about tradespeople, such as Checkatrade and Trustmark. Do some homework online to see if your chosen builder has a good track record.

2)   Membership bodies

Most good builders will be members of at least one trade body such as the Federation of Master Builders, the Guild of Master Craftsmen, or FENSA. Always double-check a builder’s membership claims. Never take their word for it.

• Check the finances

The last thing you want to do is spend tens of thousands of pounds – or more – with a company that is in negative equity. Ensure the builder is in good financial shape by reading over their annual accounts on the Companies House website.

4)   See for yourself

Ask to see examples of previous building projects. Ideally, visit the site and speak to the client (Covid-19 restrictions permitting). Also, find out where the builder is working currently and drive past to see if the site is tidy and if workers turn up on time.

5)   Get three quotes and a watertight contract

It always pays to get three quotes and to ensure contracts cover the full scope of works. Never leave detailed building projects to chance or make agreements based on a wink and a handshake.

6)   Avoid cold-callers

If someone knocked on my door and offered to do a job for me on the cheap, I would immediately be suspicious. Good builders are busy – for example, they may have clients lined up until the end of the year. Steer clear of canvassers and be prepared to wait for a good builder to start work at your property.

7)   Go on instinct

Trust your gut. If something doesn’t feel right when you talk to a builder, exercise caution.

If you would like advice about how renovations could add value to your South Devon property, get in touch with us here at Chamberlains.

© Chamberlains 2021

 

How to Help Elderly Relatives Move Home in South Devon

A three-minute read.

For an elderly relative, moving on to the next chapter of their lives can be an emotional experience. The need to move home might stem from financial needs, bereavement, health reasons, or the wish to be nearer loved ones. But whatever the catalyst, time, diplomacy, and tact are the order of the day.

Don’t rush

It’s essential to broach the subject of a move sensitively. A move in the twilight years is likely to be a final move, so it’s important to think carefully about future needs. Consider one-level living, a spare room for live-in help, and proximity to local amenities and GPs.

Size matters

For 99% of elderly homeowners, the next home is likely to be smaller than their existing home (and for some, significantly so). Prioritise the essentials in terms of furniture and belongings, being mindful of what will fit in the new home.

Clear the loft

Try to avoid simply moving the contents of one loft to another. If you can, digitise old photos and upload keepsakes to a digital photo frame. Reminders of fond memories can make a new property quickly feel like ‘home’. Shred bank statements and other unneeded paperwork to avoid any risk of identity theft.

Be respectful

When it comes to letting things go, try to help your relative make their own decisions rather than substituting your own. While you may think that their Encyclopaedia Britannica collection is ready for the skip, it may be cherished by your relative. It may be less painful for them to see treasured items go to family, friends, or their chosen charity, rather than auctioned off on eBay.

Have fun

Getting the whole family involved can help make sorting out belongings a more enjoyable experience. If you can, have a photo slideshow scrolling while you work, play your relative’s favourite music, and reward your efforts with a family meal at the end of the day.

Enlist experienced experts

On moving day itself, consider choosing a removal firm experienced in helping elderly people move home. A packing and unpacking service can lessen the load and help make your relative feel settled more quickly.

We’ve been helping elderly South Devon property owners move home for over 23 years; we understand the importance of treating seniors with care and respect.  Check out our guides for more helpful tips.

For more advice on helping an elderly relative with their next property move, contact us here at Chamberlains.

© Chamberlains 2021

 

Calculating Your South Devon Buy-to-Let Return

A two-minute read to help you quickly determine the return on a buy-to-let property in South Devon.

If you’re looking for a property to rent out, it’s important to understand the numbers involved. You may have inherited a property and are thinking of letting it. Use the information here to identify if that is a prudent thing to do or if the capital from selling the property could be better invested.

Find the numbers

The simplest way to work out your gross return on a rental is to estimate some numbers. You can have a browse on the property portals to get a vague sense of what properties in your budget sell for and let for. These figures change across the country so it’s important to start with your own research.

Quick and easy

Here’s a simple calculation to get you the basic overview. Let’s use an example of a £150,000 property that rents out for £500 a month.

500 x 12 (months in a year) = 6,000 p.a.

Divide 6,000 by the purchase price of £150,000 = 4%.

For some investors, a 4% gross yield would be sufficient. Others look for higher but it’s all rather area dependent. Here in South Devon, we normally suggest looking to achieve around 5%.

Deduct your deductions

We’ve worked out your gross figures. But it’s the net figures that are the ‘money in your pocket’ numbers. To work these out, you’ll need to employ a little more guesswork. Better still, ask a local property expert, like us, who deals with these things, day in, day out. Then you’ll be closer to an accurate estimate. The figures you need are:

• Solicitors’ costs (if you’re purchasing a property)
• Landlords’ insurance
• General property maintenance
• Agency fees
• End of tenancy cleaning costs

These can be off-set against your income for tax purposes.

Taxes, taxes, taxes

It’s reasonably straightforward to submit your tax returns yourself. They need to be done annually and submitted by the following January. It’s recommended though to use an accountant. They will be up to date with all the latest options open to you. Not only that, they can often help in other areas, like looking at your pension or investment options.

For rental opportunities in South Devon, get in touch with us on 01626 365055. Our lettings specialists can help you consider the market and the best options out there for you.

© Chamberlains 2021

 

National Children’s Day

In this two-minute read, we look at ways to promote children’s wellbeing.

The past year has been challenging for kids, so let’s make them feel special on National Children’s Day (NCD) on Sunday 16 May.

The lockdowns of the last year hit children particularly hard. While little ones often say they want to skip school, the reality is many find its structure reassuring. (Sadly, some also feel safer at school than they do at home.

Not only did lockdown mean children couldn’t be with their friends, for many, it also meant less exercise and more screen time – and their mental health suffered as a result.

Currently, about one in six children has a diagnosable mental health condition (source: Place2Be). But with the Covid-19 crisis easing in the UK, we can start to turn the situation around.

Here are eight ways you can mark NCD with your child.

Bake

Don’t feel pressured to whip up a fancy showstopper – simple cupcakes or flapjacks will go down just as well. After all, for most children, the best bit is dipping their fingers in the mixture.

Draw

There’s something incredibly calming about sitting with your child and drawing. It’s a great way for kids (of all ages) to express themselves.

Lego

You probably stepped on plenty of primary-coloured plastic bricks during lockdown, but when did you last make something with them? The internet is awash with brilliant Lego projects, from pencil holders and tissue boxes to volcanoes and monsters. Get creative with your child.

Talk

Children often struggle to put news headlines into perspective. For example, a survey of 1,000 children found that 47% were anxious about dying from Covid-19 even though the death rate among under-18s is extremely low (source: Action for Children Wales). Take time to chat to your child about their concerns. Don’t dismiss their fears but put them into context.

Exercise

One of the best ways to improve wellbeing is to get moving. Run, walk, skip or swim with your little one.

Let them teach you

Adults are always telling kids what to do. Reverse the roles and let your child teach you something, be it their favourite computer game or how to do a handstand. Watch their confidence grow when they get to play expert.

Make a playlist together

We’re guessing your taste in music is different to your child’s, but there must be some common ground. Discuss your favourite tunes and make a playlist. You’ll be able to listen to it again and again.

Plan a special meal

Celebrate NCD with a swanky home-cooked meal. Devise the menu with your child, and then make it memorable. Light a few candles, put some music on, and serve up a tasty feast (and don’t forget pudding)

From all of us here at Chamberlains, stay positive.

© Chamberlains 2021

 

 

 

Low-Fee Agents: Why South Devon Sellers Should Beware of Rock-Bottom Deals

In this two-minute read, we look at why low agent fees don’t equal top selling price.

Unless your name is Elon Musk, selling your home will probably be the biggest transaction you make in your lifetime. So, who will you entrust to get you the best deal?

Option 1: You go for the agent with the lowest fee. This agent is a doppelgänger for Del Boy, but you love the idea of saving yourself a few hundred quid in fees.

Option 2: You go for an agent who makes properties look and sound A-M-A-Z-I-N-G. The fee is a little higher, but they have a reputation for achieving sales that are above asking price.

Do the maths

The agent in Option 2 offers the best value because they will put the most money in your pocket.

When an agent cuts their fee, they’re cutting back on the time and money they invest in marketing a property.

They might sell your home, but they won’t get the best possible price for it.

Here are five ways to tell if an agent will offer you good value.

• Images

Top agents use quality photography to capture properties at their best. Grainy, shadowy photos taken on a smartphone are a turn-off for buyers.

• Property descriptions

Look at how agents market properties online. Do the descriptions create an aspirational picture? Or are you reading a list of measurements, plug sockets, and radiators? Good agents will also include a floorplan in listings.

• Bringing a property to market

If an agent brags that they can have your property on the market by tomorrow, run for the hills because they’re cutting corners. The best agents have a tried-and-tested launch strategy that takes more than 24 hours to implement – but adds thousands of pounds to a sale.

• Long tie-ins

An agent who is confident that they can sell your home doesn’t need to lock you into a lengthy tie-in (some agents push for 20 weeks’ exclusivity).

• Social media

Even if you’re not on Instagram or Facebook, many buyers are, so go with an agent with a strong social media presence. Look for engaging posts that cover more than properties for sale. Community content, mortgage updates, and sneak peeks are big winners.

We all love a bargain (that’s why Poundland exists), but with a low-fee agent, the person who lands the great deal is the buyer, not the seller.

If you’re thinking of putting your home on the market, get in touch with us here at Chamberlains. We’ll exhaust every possible avenue to secure the best price for your home.

© Chamberlains 2021

 

A three-minute read for landlords

Having a rental property can be a great way to earn some extra income. Like anything, there are a variety of things that can go wrong. We break down five of the most common ones. 

The wrong property

Being a landlord means running a business. You’re not buying a property for you to live in. Tenants often have very different expectations when looking for a rental property. Don’t turn down a great opportunity because you wouldn’t like to live in it.

The wrong tenant(s)

Choosing a good tenant is the second most important decision you’ll make as a landlord, (selecting an excellent letting agent being the first). Rushing into it without applying the correct referencing and selection process could put you at risk. You can end up out of pocket with unpaid rent, no deposit to cover damages, or even squatters.

The wrong timing

Unexpected maintenance is a normal part of owning property, as you may well know from your own home. Tenants often don’t notice little things that need immediate attention. This is because they’re not the homeowners. What can start out as a small leak can quickly turn into a massive problem if not attended to promptly.

The wrong tradespeople

If your rental is not in the area where you live, you might struggle to find decent tradespeople. One common problem, even when you’re local, is finding someone who is great at their trade and available at short notice. You can end up with shoddy work that you have to repair later. We can recommend trusted local traders. 

The wrong paperwork

In the UK, there are over 300 rules and regulations governing property rental. These can vary across the different countries. If you don’t have the right paperwork in place, if things go wrong and you end up in court, you will always lose. It doesn’t matter the ‘rights and wrongs’ of the situation at that point. If you don’t have every box ticked, the judge will always award against you.

The solutions

Treat your rental property like a business. Don’t buy with your heart. Find great tenants who understand and accept the correct referencing procedure. Don’t let to a friend’s “cousin who really, really needs the help right now, pretty, pretty please!”. Carry out regular property inspections, especially at the start of a new tenancy. Don’t fall into the trap of doing it all yourself. The government regularly changes the paperwork requirements. The advice online is often out of date. Don’t risk it. Use a lettings agency with the three Es – Experience, enthusiasm and expertise.

We’ve been helping landlords in South Devon for years. We know the pitfalls and how to help you avoid them. With regular training and professional bodies, we stay on top of the inspections and paperwork so you don’t have to.

© Chamberlains 2021

In this three-minute read, we celebrate those working in the noblest of professions – nursing.

As it’s International Nurses Day next week, we thought we’d share this brilliant quote with you: “Save one life, and you’re a hero. Save 100 lives, and you’re a nurse.”

International Nurses Day is on 12 May (the birthday of Florence Nightingale, the founder of modern nursing). It’s a chance to thank a profession that has given so much during the pandemic.

Nurses have served on the Covid-19 frontline for more than a year, delivering high-quality professional care along with unstinting compassion and kindness.

This was most apparent at the height of the UK crisis when hospitals banned visitors to stop the spread of the virus. It fell to nurses to provide soothing words and comfort to the critically ill.

And let’s not forget the nurses who work in other parts of the health system such as care homes, hospices, cancer units, and paediatric wards. They truly bear witness to birth and death and the journey of life in between.

To mark #NursesDay, here are four inspiring nursing stories:

– When East Londoner Laszlo Kelemen isn’t working as an NHS nurse, he volunteers as a Red Cross emergency responder. Laszlo has attended car crashes, house fires, and major incidents including the 2017 London Bridge attack and the Grenfell Tower blaze.

– Vasu Lingappa is a senior nurse with University Hospitals Coventry and Warwickshire NHS Trust. Earlier this year, Vasu won praise from the Duchess of Cambridge for his compassionate care throughout the Covid-19 crisis. During one patient’s final moments, Vasu held his hand while playing music by the man’s favourite band, Bon Jovi.

– Alma Ainslie-Davies is a nurse with the end-of-life charity Marie Curie in the Grampian region of Scotland. Alma spent 24 years in the Army but changed careers after witnessing Marie Curie nurses care for her late mother. Alma now works to ensure the terminally ill enjoy respect and dignity in their final days.

– Viveki Kapoor works in a Delhi hospital. She has nursed for 22 years but has never seen anything like the Covid-19 crisis currently engulfing India. She told the BBC: “I’m so tired at the end of the day that I can fall sleep anywhere. I don’t even need a bed anymore.”

You can show your support for nurses by sharing #NursesDay on social media on Wednesday.

All of us here at Chamberlains, would like to thank the nursing community for their dedication and service.

© Chamberlains 2021

 

In this two-minute read, we look at ways sellers can identify genuine buyers.

With demand currently outstripping supply in the housing market, sellers are in the driver’s seat, but there is still one hazard that could derail a sale: the flaky buyer.

In a hot market, it’s not uncommon for panicky buyers to make an impulsive offer or go beyond their financial limits.

A buyer might do this because they fear that prices are rising and the market is getting away from them. Or perhaps they’ve been outbid in the past and don’t want to lose out again.

Whatever the motivation, the result is the same: the buyer isn’t committed and drops out weeks or months into the sales process.

Not only is it frustrating for the seller but it could also cost them financially if they’re part of a chain which then collapses because the parties involved grow impatient.

Here are some tips to help you identify genuine buyers.

–         Arrange a second viewing. If the buyer makes an offer after the first viewing, your agent should arrange a second visit to see if they are still as keen as mustard. The buyer should be quizzed about their plans for the property to see if they’ve thought through the purchase.

–         Do the admin. Ensure your agent gets the buyer to fill in an offer form that includes details about their mortgage provider and solicitor. It’s preferable to go with a buyer who already has their ducks in a row.

–         What’s the story? Chat to the buyer about why they are moving. If they’re expecting a baby and have family in the same street, it’s a fair bet that they’re the real deal. If they know little about the area or their story keeps changing, question if they are committed to the sale.

–         Ensure the lines of communication are open. Ideally, your buyer will keep you informed of their progress on the survey, searches, and chasing solicitors. Be wary if things go quiet quickly.

–         Work with an experienced agent. Even though it’s a buyer’s market, a good agent can streamline the process for you. They’ll be good at spotting the genuine buyers from the chancers.

For more advice about selling your home, contact us here at Chamberlains

© Chamberlains 2021

 

In this three-minute read, we look at how landlords can avoid getting a bad insurance deal.

If you’re a landlord looking to take out insurance or renew a current policy, there are a few things you should know.

The insurance market is “hardening”, or in other words, insurers are tightening their belts.

The rising costs of claims due to extreme weather events such as last year’s Storm Dennis and low interest rates (meaning insurance firms make less on their investments) have hit the industry hard.

As a result, insurers are upping the cost of premiums and employing other – less obvious – tactics to increase their bottom line.

But first, a quick reminder

Landlords need specific insurance; a standard home and contents policy will not suffice. Landlord insurance is usually a condition of a buy-to-let mortgage, but even if you’re debt-free, it’s worth getting. (You hope the worst won’t happen, but if it does, you’ll be covered.)

Standard policies include buildings and liability cover, although you can also opt to include things like legal costs, accidental damage, or loss of rent.

Insurance tips for South Devon landlords 

Follow this checklist to get the best deal

– If you already have a policy, read it thoroughly before you start your research. It might not be the most exciting few hours of your life, but your diligence could save you time and money in the long run.

– Note in your diary when your policy is due to expire and leave yourself enough time to shop around. You won’t get the best deal if you’re in a last-minute panic.

– Look at what the premium covers. Is there a gaping omission that could leave you exposed? If it’s an existing policy, has your coverage been reduced?

– Check the standard excess (excess rates have been creeping up). The policy premium might be appealingly low, but if the excess is high, you could wind up paying more in the long run.

– Be aware that some types of claims have a higher excess. For example, escape of water (which covers leaks and burst pipes) has a higher excess as it’s a more common occurrence.

– Check the rules around vacancy as some policies become void if the property is empty. As there could be a rise in tenant turnover when furlough ends later this year, ensure your policy gives you a bit of leeway on vacancy periods.

– Have your paperwork to hand when talking to insurers. They’ll want to know (and see proof of) the age of the property, state of repair, and claims history.

– Some policies only cover certain types of tenants – for example, professionals – who are viewed as low risk. It may pay to include other tenant groups, such as students, in your policy to give you more flexibility.

For more advice about protecting your rental property, get in touch with us here at Chamberlains.

©Chamberlains 2021