I have done a few of these through a limited company over the years and I have to say the business model does not really work anymore. Unless you buy the property that you intend to renovate at a incredibly discounted price the profit margin is very small and not worth the aggravation and risk. By the time you factor in paying the extra stamp duty, paying 20% more for materials and labour (no vat relief) corporation tax on the net profit plus the costs you have already hi-lighted, there is not much left. In fact if you reverse engineer the numbers as you illustrate and add in the costs I mention I doubt anyone would start the project. Its definitely not scalable. The only way this strategy works in my mind is if it is your main residence and you self build one at a time. Even then unless you are a builder or take on a lot of the work its very high risk.
Very true. Its working for us but we are very selective about what we buy, and do a lot of work ourselves to keep costs down. With corp tax and dividend tax if you actually need the money it's tough.
I agree with most of comments that this does not work anymore,there is no property that is truly below market value,once you factor in costs of finance and time to do the project,£0 profit I have done for many years unless in or around london you will straggler to make any profit at all, I understand buying at a good price,but who will sell a lesser price that advise to sell,so how do you find a good price property very unlikely, I thinking stock and shares is a better way to make money passively, I have several properties and don’t get any better value if i had invested in stocks and shares, Soon as the market returns to sellers market i will be shifting my portfolio,
I've ben flipping for 5 years now ( as a side hustle). My biggest challenge is finding the 1% or 2% of properties that have enough fat in them to make enough profit.
@@YEEAAHHBAABYY not sure if you're serious or not, but it's fundamentals, buy a run down property, do it up and sell it. There's a million you tube videos on flipping..watch those.
@@JamieYork at 3.40 "you cannot use a mortgage"... 1.I sold house and ported my mortgage to get my new property( got it very cheap as it needed full refurb) 2.Took me over 12 months to do it . 3.Now is 18 month since I purchased house and ready to put on the market (after 12 months home become your primary residence and as far as I know i am entitle to full private residence relief and no capital gains would be due . 4.I am ready to sell it and port my mortgage again to purchase my new home which again will need to be renovated and do same proces all over again... Ps.this is the only property I own,I lived there while I was doing it up,the circumstances I am at right now allows me to do it few more times and would like to use this opportunity while I can without breaking any law ... Thank you for help(if there is possibility to contact privately that would be great if not then I do understand and once again thank you for help and advice)...
If they’re in your personal name you will get a tax exemption in place and you’ll pay it in one location (probably the uk). If they’re are in a Ltd company you will still pay uk corp tax
You can’t reclaim VAT on property flipping unfortunately. I’ve done 11 flips in the past 2 years, I do it through an SPV and still can’t claim back the VAT
@@SWEDSHECKER corporation tax but with BTL held in a ltd company the mortgage interest is deductible. I’ve only got 4 so I’m not exactly a tycoon lol but does save you a nice bit of cash
I have done a few of these through a limited company over the years and I have to say the business model does not really work anymore. Unless you buy the property that you intend to renovate at a incredibly discounted price the profit margin is very small and not worth the aggravation and risk. By the time you factor in paying the extra stamp duty, paying 20% more for materials and labour (no vat relief) corporation tax on the net profit plus the costs you have already hi-lighted, there is not much left. In fact if you reverse engineer the numbers as you illustrate and add in the costs I mention I doubt anyone would start the project. Its definitely not scalable.
The only way this strategy works in my mind is if it is your main residence and you self build one at a time. Even then unless you are a builder or take on a lot of the work its very high risk.
Very true. Its working for us but we are very selective about what we buy, and do a lot of work ourselves to keep costs down. With corp tax and dividend tax if you actually need the money it's tough.
I agree with most of comments that this does not work anymore,there is no property that is truly below market value,once you factor in costs of finance and time to do the project,£0 profit
I have done for many years unless in or around london you will straggler to make any profit at all,
I understand buying at a good price,but who will sell a lesser price that advise to sell,so how do you find a good price property very unlikely,
I thinking stock and shares is a better way to make money passively,
I have several properties and don’t get any better value if i had invested in stocks and shares,
Soon as the market returns to sellers market i will be shifting my portfolio,
I've ben flipping for 5 years now ( as a side hustle). My biggest challenge is finding the 1% or 2% of properties that have enough fat in them to make enough profit.
teach me your ways
i’ve got the cash
just need guidance
@@YEEAAHHBAABYY not sure if you're serious or not, but it's fundamentals, buy a run down property, do it up and sell it. There's a million you tube videos on flipping..watch those.
100%. It’s all about direct to vendor for me
@@thepropertyflipper i’m deadly serious
i just need guidance
end of this year i’ll be sitting on about £50/60k
You cannot get it with a remortgage. We tried that avenue, and ended up getting a BTL instead.
Not sure what you mean. If you’re selling you wouldn’t put it on a mortgage
So i can't do this if i have mortgage on my ONLY house ???
You absolutely can
@@JamieYork at 3.40 "you cannot use a mortgage"...
1.I sold house and ported my mortgage to get my new property( got it very cheap as it needed full refurb)
2.Took me over 12 months to do it .
3.Now is 18 month since I purchased house and ready to put on the market (after 12 months home become your primary residence and as far as I know i am entitle to full private residence relief and no capital gains would be due .
4.I am ready to sell it and port my mortgage again to purchase my new home which again will need to be renovated and do same proces all over again...
Ps.this is the only property I own,I lived there while I was doing it up,the circumstances I am at right now allows me to do it few more times and would like to use this opportunity while I can without breaking any law ...
Thank you for help(if there is possibility to contact privately that would be great if not then I do understand and once again thank you for help and advice)...
Hello mate I have 2 rental properties in the UK and I'm about to move to live in the U.S any idea how the tax would work for me?
Joshua tharby
If they’re in your personal name you will get a tax exemption in place and you’ll pay it in one location (probably the uk). If they’re are in a Ltd company you will still pay uk corp tax
@JamieYork thanks for that mate that's helpful! Loving your videos
From what you say its best to do one at a time and keep each property as you'r main residence. To avoid tax issues. Can you reclaim VAT on a refurb?
You can’t reclaim VAT on property flipping unfortunately. I’ve done 11 flips in the past 2 years, I do it through an SPV and still can’t claim back the VAT
@@james-tm2jq what's your tax liabilities for this setup?
@@SWEDSHECKER corporation tax but with BTL held in a ltd company the mortgage interest is deductible. I’ve only got 4 so I’m not exactly a tycoon lol but does save you a nice bit of cash
If you’re vat registered in the business then yes you can 100% claim it back
@@JamieYork SPVs can’t be registered for VAT though can they
How soon can you flip a property that you bought in your name after you purchased it.