Buy to let landlords have been badly hit recently – with both changes to tax laws and the stamp duty increases going against residential landlords and their investments. This has therefore had an effect on the number of buy-to-let sales, for understandable reasons, but there are alternative options for an investment purchase…
Have you considered buying a commercial property as an alternative?
For one thing stamp duty taxes are lower compared to when purchasing a second residential property but also taxation is lower – so this explains why commercial lending has risen by 19%.
Costs can also be lower with tenants paying to repair and insure the building and voids are lower as leases tend to be for five years opposed to 6 months so less work for you to do.
There are also many more lenders that offer commercial mortgages which can range from buying a commercial building for rent or buying an existing business.
Commercial lenders will assess the viability of what you wish to buy and indeed as an investor you also need to know that what you are buying will be a good investment. If purchasing a business make sure to look closely at what the profits are like for the business that you are looking to buy, obviously if the profits and projections of the business are not positive most lenders will not lend!
It is certainly worth looking at what a commercial mortgage can offer you but make sure that you are asking the right questions to see if this will be a good investment.
UK commercial property lending rises 19% and Property Investor Reward Club have partnered with a large firm of whole of market mortgage and finance experts who will arrange your property finance at preferential rates if you quote PIRC and share the commission paid by the lender to the broker.
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