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C2B

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About C2B

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    HPC Newbie
  1. For me, I only bothered taking out a pension 10 years ago as my employer was matching my contributions up to 5%. e.g. £100 gross pay, which is £60 (as I am in the 40% tax band) net .. cash in account v £200 in pension. A profit of £140 there due to matching contributions and tax relief (although you may end up paying tax on your income upon retirement) I currently have it in a global equity index (http://factsheets.financialexpress.net/scow/TCG.pdf) (was the default option my employer signed me up for, which I might change based on my risk appetite) Numerous options are available at retirement (earliest being age 55). - 25% cash lump sum withdrawal which is exempt from tax - Swap your pension pot for an annuity (of which there are many types!) - Income drawdown - Phased retirement See https://www.moneyadviceservice.org.uk/en/articles/annuities-and-other-types-of-pension-income-your-options Now to find a fund that shows a good track record of returning a % higher than inflation + fees (approx 6%+) ...
  2. Thanks Tired of Waiting for the direct link to the document. Very useful regional data there. Sorry if this is a stupid/silly request, but I've always found the Land Registry site hard to navigate/use. Is there a page where one can navigate to, to see the month by month reports? Cheers, C2B
  3. We have ruled out STR because we don't want to have to deal with the stress of moving twice. Also would not want to be at the mercy of landlords now we have a small and growing family. Regarding being treated like sh*t by the agents, yes we felt that way when bidding. I think they knew they had a property that would sell on their hands, but I'll keep an eye out for it in case it falls through. Any opinions/advice on the being a landlord bit? Would that be a bad move as I would either be paying 40% tax or the BTL rate (5%+ ?). Thanks C2B
  4. Hi, My partner and I are finding it extremely difficult to upsize from our current small mid terraced house to a bigger terraced/semi detached house. We would very much like this to be our new long term (20+ years .. possibly till we retire) home as we're expecting our 2nd baby next year (1st one is already 2). We have been fortunate enough to have bought back in 2002 having saved for a deposit and lived within our means. Over these past 8 years, we have been overpaying on our mortgage while the rates have been low and will soon have paid of the mortgage. Whilst I believe a HPC is forthcoming, our circumstances means we're having to dive in over the 6 months or so. The main drivers for the upsize is space and schools. The area (SE) we're wanting to move to doesn't seem to have been dropping much and any good properties that ticks most of our boxes are usually snapped up pretty quickly. (We had put in an offer and was outbidded, estate agent tried to get us into a bidding war the b@stards). So .. my current thinking is we have 2 realistic options: 1) Stay in current property (small but liveable) and keep on waiting for the HPC and keep an eye out for suitable properties to appear and act quick. To be ready, we have now put our property on the market and also have a mortgage offer in place. 2) Purchase a cheaper property we have identified that has potential for extending without having to sell current house. This will mean we can effectively be a cash buyer (well... no chain. i.e. savings and mortgage should cover the price of the run down property) and should give us more bargaining power. With option 1, there will be chain stress as we need to find a buyer but no DIY/building work stress. With option 2, bigger mortgage than option 1 and less savings. no chain stress (on my side) but building/DIY work to manage (at least pregnant wife will still have current home to live in while run down property gets refurbished). Once new property has been extended to be our long term home we then intend to rent out current place (or possibly still sell as we're tied in to a 12 week agreement at the moment). This is where I am a bit unsure of things as I have never been a landlord before and there will also be tax implications as I am a high tax earner. It would not make financial sense to be taxed 40% on the rent I get. Is there any way around this? One would be to release equity on the current home and report the interest I am having to pay to the taxman so the rent is offset against it. (If this was with another lender, would I need to inform the bank that gave me the mortgage for the run down property? What can they do?) Finally, there is option 3 which is STR - but we have ruled this out Any advice will be much appreciated. Cheers, C2B
  5. C2B

    Beckenham

    Hi, How would you compare the Beckenham to Bromley town centre? (in terms of price of 3/4 bed houses, shops, facilities, travel, green space, residents/community) We are planning to move there within the next year/2 years to hopefully coincide with the price drops we feel is coming this coming winter and at the moment we've been mainly looking at Bromley. Primary concern is the quality of state schools. The 2 schools we're considering are: Beckenham - Park Langley Bromley - The Ravensbourne School Look forward to people's opinions. Cheers, C2B
  6. I think you're right LiveAndLetBuy Thanks for the advice. There can be quite a few permutations. i.e. Qualifying for "Private Residence Relief" and also "Letting relief" Thanks D'oh for providing those links.
  7. Hi grizzly bear, Thanks for replying I've now read HMRC's HS283 Private Residence Relief (PDF 84K) and "think" I understand it better So if I sell for 3 years after moving out I qualify for the full 40k relief as it was my ONLY primary/main residence prior to that. If I sell 4 years after moving out, 1 year would not qualify for the full 40k relief (hence the fraction ) I get the 10k CGT allowance regardless. Correct? The primary reason for holding on to PROP A is to avoid a chain (i.e. having to find a buyer (who could also be on a chain)). Point taken that I also take on risk that it could continue to drop further. If I buy (what I think may be) near the bottom (Q4 2010), then perhaps there is scope for it be "back in profit" in the future. Whilst I am breaking even/making a little proft from renting it out (thinking of a 2+ year Private Sector Leasing Scheme) the risk is somewhat minimised. Is this a bad idea? Perhaps I should just sell PROP A to buy PROP B (and take on the hassle of a chain)
  8. Hi, I hope this is posted in the most appropriate section. (Apologies if it is not and could moderators move it the correct section please?) I currently have a balance of approx. 23k on my mortgage on my one and only house. (Mortgage and title deed is solely in my name. Let us call this PROP A). This can be paid off in full by Dec 2010. My wife and I currently have 1 child aged 1.5 years and are looking to buy another property (3 or 4 bed. the future family home. Let us call it PROP B.) when a further 17% drop occurs. i.e. when 300k houses become 249k. (although we could offer 249k when they get listed at 275k) Q1) Should I consider remortgaging to release 75% equity from PROP A (valued around 230k) to use as deposit for PROP B? If so, would a "offset" (CAM) type mortgage be most apprpriate as it will just sit there not being charged interest on/not gaining interest. i.e. Continue to pay off 23k, keep remaining 150k in offset account. Then use the 150k as deposit for PROP B when (maybe Q4 2010) /if we find it for approx 250k. Would need another 100k mortgage for PROP B. Approx 172.5k mortgage for PROP A. At this point, we intend to rent out PROP A by informing mortgage lender to switch to BTL/Consent to Let (with little fees hopefully) and on a INTEREST ONLY. The rent "should" cover the interest payments on the 172.5k and make little/no profit - therefore paying little/no tax to HMRC. The intention would be to sell it at some point in the future if prices ever climb back up again. Alternatively, we could sell PROP A when buying PROP B. This however will mean we forms another part of a chain. Q2) If we decide to rent it out and sell at a future date, am I right in understanding the current rules around CGT. i.e. a flat 18% deduction from the profit. I bought PROP A back in 2002 for 149k, but have spent 12k (4k on central heating, 4k on front and back garden patio/decking and 4k on double glazing). If I were to sell (say 5 years from now) for 249k, making a profit of 100k. Would the CGT be: 100k - 12k (refurb costs) - 10k (cgt allowance) = 78k profit 18% of 78k = 14k CGT payment to HMRC 249k - 14k (CGT) - 172.5k (mortgage on PROP A) = 62.5k profit The 62.5k profit would then go towards paying off the 100k mortgage on PROP B. Have I missed anything obvious? I've heard of something called 3 year grace period but don't know too much about this. Is this 3 year grace period where I can sell within 3 years of it no long being my primary residence and not be liable for CGT? Sorry for the long post, but if anyone is still reading and have any wise words of advice or opinions/suggestions, I would be happy to hear from you. Many thanks. B2C
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