How to rent out your house
I'm moving abroad, but I'm considering renting out my house so I don't have to sell it. What do I have to do to rent out my house?
Renting out your house when you move abroad can be a very sensible idea. With ever increasing property prices in the UK, getting off the ladder can be a bad idea if you intend to return to the UK in the future. Even if you have a mortgage, you can offset any monthly payments with rental income and not be subject to tax in the UK as a result.
If you are intending to rent your house out while living abroad, there are a number of key things you need to consider.
If you've never rented before, you should research your local area to see current rental values, also research potential letting agents and finally research the rules around letting your property.
2. Mortgage options
If you have a mortgage, you will need to speak to your mortgage provider and potentially an independent mortgage adviser to understand what your options are, any potential costs and investigate whether you can switch to a buy to let mortgage.
3. Furnished or unfurnished?
You need to decide whether you want to offer your house as a furnished property, and if so wish items you intend to leave in your house. The other items which you are not planning to take abroad with you will need to be put into secure, long term storage. You will need to research the most cost effective ways of doing this. You may also wish to sell some items.
4. Tax considerations
When you rent your house, this will be classed as income and therefore subject to income tax. There are certain costs which can be offset against your income to reduce your tax liability, and you may have a personal allowance which means you can earn a certain amount before being taxed. However, if it is a UK property, you will have to complete a self assessment tax return. Your income may also be subject to income tax in your new country of residence. Therefore, before making any decisions you should speak to a qualified tax adviser.
If you decided to sell your house at any time, you may now be subject to capital gains tax as well.
5. Agent vs no agent
If you are moving abroad, it is sensible to find an agent who can manage the property and tenants in your absence. Managing this yourself may require regular trips to the UK which can be very expensive, whereas paying a professional to manage the property in your absence can reduce your stress and keep the costs to a minimum.
They will also be able to create a robust tenancy agreement, something which paying for a lawyer to do can again be very expensive.
When you rent your house, it is important you have the correct landlord insurance in place. Your existing home and contents insurance will not be sufficient. This can be expensive so it is important to shop around.
For more information about how to rent your house, please read our detailed guide to renting out your home.