What You Need to Do for Buying a Second Home - Mountview Financial Solutions

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What You Need to Do for Buying a Second Home
While having a second house is still a luxury
that a selected few can afford, the number of
Britons who own several properties has increased
significantly over the years. In fact, over 10
of the adult population now owns a second house,
and the trend shows no sign of stopping
down. The reasons for buying a second home
differ, as we'll see in a moment however, the
process is usually the same as are the costs,
and we'll cover everything you need to understand
in our guide to buying a second home.
Why Do People Buy a Second Home?
As we noted in the beginning, there are various
reasons why homeowners decide to buy a second
home. However, they usually fall into one of
three categories 1 - Investments The massive
increase in multiple property ownership is due to
people buying a second home purely as an
investment. The rise of the private rental sector
has provided customers with a fantastic chance
to invest in the real estate market through buy
to let.
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2 - Houses for Vacation Another popular reason
is to buy a second home as a vacation home, which
can be purchased in either the UK or a
completely different part of the world. Weekend
retreats, usually in greener sections of Britain
far off the urban sprawl, fall into this category
as well, even if they're not whatever one would
think of as a holiday home. Also Read Buy To
Let Property Which One Is The Best Limited
Company vs Personal Investment? 3 - Buying a
Home for Someone
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Our third reason for buying a second home isn't
quite as common as others listed above, but a
considerable percentage of owners still go in
need to aid a loved one get on to the housing
ladder. However, because of the current level of
stamp duty, you must pay if you buy a second
home having another property in your name might
not have been the better decision. That's why,
before agreeing to buy the property yourself,
experts recommend carefully understanding all of
your choices and becoming their mortgage
guarantor, gifting the money, or putting up a
loan. Different Ways to Buy a Second Home There
are three basic strategies to achieve multiple
homeownership, as there are three reasons why
people buy second homes. 1 - Getting a Mortgage
for a Second Home

• It's a popular myth that homeowners should pay
  off their current mortgage before applying for a
  new one, but that's not true. You can have two
  mortgages at the same time. However, if you want
  lenders to take you more seriously, you should
  also have a few things in order. Here are a few
  of them
• You must be able to show that you could afford
  the additional mortgage.
• Having a large down payment, usually and over a
  quarter of the new home's cost
• Information on the property's earnings potential

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If you do want to buy a place to rent while
maintaining your current house as an investment,
another option to consider is a let to buy
agreement. Also Read Why Do You Need Mortgage
Broker and Perks of Having Mortgage Advisor 2 -
Buy a Second Home Using Equity If you find
yourself in a situation where your existing
property has a lot of equity, you might like to
release some to cover most of the new purchase
and deposit. It is normally accomplished by
remortgaging the main residence. 3 - Using
Money Buying a second home becomes a lot easier
if you're lucky enough to have money to spend.
Find a property you like and is within your
budget, perform the required checks, organize a
survey, and move forward.
Consider Other Key Costs When You Are Buying a
Second Home
However, purchasing is just the first step. When
buying a second home, there are additional costs
to consider. 1 - Stamp Duty Applies to Second
Houses
The stamp duty you'll pay when buying a second
home has been one of the main deterrents to it.
The buyer needs to pay additional 3 stamp duty
to purchase their second home (Stamp Duty rates
at the time of publish of this article). 2 -
Second Home Capital Gains Tax
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When it comes to selling, the costs will endure.
When you sell your home, you'll have to pay
capital gains tax, due to that any profit over
the current 12,000 allowance would be greatly
decreased. 3 - Council Tax Although if you
consider buying and selling as two sides of a
journey, there are plenty of costs to consider
all along the way. One is the local government
tax. You might be responsible to pay council tax
for your second home if it is not Buy to Let.
However, you may be eligible for a reduction if
your property fulfils certain criteria. I hope
the below information will help you when you are
buying a second home. If you are thinking of
buying a new home and don't have any idea
regarding the process, then hire Mountview
Financial Solutions, a mortgage broker in
London. A mortgage broker in London has many
years of experience to give mortgage
advice. Original Source https//mountviewfs.co.u
k/what-you-need-to-do-for-buying-second-ho me/