Property investment is a hot topic among our users currently and they are also looking at more.
“Accidental landlords” are exploring their options
It is estimated that eighty percent or even more of the UK’s landlords are so accidentally due to inheritance, rather than them having taken up buy-to-let deliberately. The vicissitudes of being a landlord today have obviously become too much for many such individuals, as both figures reported by the press and our own experience of speaking to users keen to explore their options confirm.
The uncertain mortgage environment and new regulations which many feel favour the tenant over the landlord too much have conspired to make buy-to-let a less attractive path to regular income. As such we’re seeing an influx of those looking to either re-deploy a portion of their wealth or even to alter their strategy in a more fundamental way. Some may still want property exposure, but in another form, while others choose to boost rainy day investment portfolios and pension pots. We are encountering very different needs and scenarios.
The uncertain mortgage environment and new regulations which many feel favour the tenant over the landlord too much have conspired to make buy-to-let a less attractive path to regular income
Getting out, or indeed into, residential or commercial property letting is a significant decision and we would always advise talking through your entire financial situation with a professional wealth adviser before making any big choices. A good wealth manager will also be able to point you in the right direction to find all the professional help you need to actuate your plan correctly.
Second property sales set to soar as dream destinations shift
As we recently featured, investment migration is on the rise among High Net Worth Individuals as countries around the world continue to lure investors with very attractive packages (often at surprisingly accessible minimum investment thresholds too). Along with this trend we are also seeing increasing enquiries from those who are looking to sell a long-held property abroad and re-invest elsewhere.
An international lifestyle is certainly aspirational, but also represents a nexus of complex rules around domiciliation, domestic and international taxation and property management, making this an area where professional advice is vital
Post-Brexit changes to the property travails of owners in Europe are no doubt a large part of the problem, and in particular swingeing tax hikes. France, for instance, is to give over 2,000 local authorities the ability to charge second home owners – even those there just part of the year – council tax surcharges of up to 60%. The sums are starting to not add up for many it now seems and new destinations are calling.
An international lifestyle is certainly aspirational, but also represents a nexus of complex rules around domiciliation, domestic and international taxation and property management, making this an area where professional advice is vital. As this piece ‘The pleasures and perils of owning a holiday home overseas’ illustrates, a wealth manager will serve a valuable role in helping you weigh up your options.
The IHT conversation turns to FICs and trusts
We are experts on the wealth management market and so do not offer advice ourselves. We do, however, offer a flavour of success stories and the strategies users might like to discuss with wealth management professionals.
Inheritance Tax is always a hot topic and we’ve been having some very interesting conversations about structures like Family Investment Companies and writing life assurance policies into trust in order to protect beneficiaries from hefty bills they have to sell assets to pay. In fact, trusts have generally been mentioned noticeably more – unsurprisingly amid predictions that the annual IHT take will reach a record £7.2bn this yeari.
Trusts are a notoriously complex area of law, however, and this is one of the many areas where a full-service wealth manager can really come into its own
Trusts are a notoriously complex area of law, however, and this is one of the many areas where a full-service wealth manager can really come into its own. Such an institution will very often have all the trust professionals you need on hand or in their contact book, and maybe in-house trust company options too.
You can talk to leading professionals in the IHT mitigation field fast and free by taking our short wealth manager matching questionnaire or take a tour of our Knowledge Centre to read features such as ‘Giving to grandchildren through a bare trust’.
Broaden your wealth horizons
Our conversations with users in recent times have conveyed a real sense of people wanting to look at their wealth afresh. Things are changing so rapidly on so many fronts currently that they are recognising the need to look at their portfolio and plan very carefully indeed to ensure that they are still fit for purpose. This is something that is as common among experienced wealth management clients as it is for those who have been doing it themselves and are seeking advice for the first time.
Our unbiased matching service makes it easy to make the moves you need to in order to secure your financial future. See if it is time to hit refresh on your wealth management plan!
The investment strategy and financial planning explanations of this piece are for informational purposes only, may represent only one view, and are not intended in any way as financial or investment advice. Any comment on specific securities should not be interpreted as investment research or advice, solicitation or recommendations to buy or sell a particular security.
We always advise consultation with a professional before making any investment and financial planning decisions.
Always remember that investing involves risk and the value of investments may fall as well as rise. Past performance should not be seen as a guarantee of future returns.