When selling property or land, always haggle with estate
agents to get the best deal. Attempt to play off one against another
to get the best service at the best price. Make sure you pick the one
that is right for you.
Buy property which needs renovating/redecorating - if you
can live there whilst the work is been carried out, this will save you
money in rent.
Run the dishwasher only when it is full. A typical dishwasher
costs about £60.00 - £100.00 a year to run with 80% of the cost
due to heating the water needed to run it. Running a partially filled
dishwasher two times will use twice as much energy as running a
full load once since most dishwashers don't have different load size
Purchase a dishwasher that requires less hot water.
Dishwashers differ in the amount of hot water used in the wash
cycle. The manufacturer's specifications or the Energy Guide label
should list this information.
Purchase a home in an area with good schools. Even if you
never have children, strong school systems are a top priority for
many home buyers. This will make selling easier and increases the
chances that your property value will rise.
Get the shortest loan term you can afford. Usually the shorter
the term, the higher your monthly repayments, but you'll save
much more in the long term due to paying less in interest charges.
Avoid purchasing a home with an "incurable defect." A busy
street, no parking or train tracks nearby will most likely get you a
discount, but the house value will not increase as much as other
homes in the area, and you will have a much tougher job selling it
when you need to.
Consider carefully before carrying out house renovations that
will make your house one of the more expensive in your
neighbourhood. For resale purposes, it's better to own one of the
less expensive houses in an expensive area.
Consider re-mortgaging if you do not have redemption
penalties on your current deal. Reductions of as little as 0.5% can
save you £00's a year and £000's over the lifetime of the loan. Or
putting it another way, rather than paying the Standard Variable
Rate (SVR) opt for a discount or tracker rate, but pay the same
every month in mortgage repayments, which will cut years off your
Purchase a home in a disadvantaged area as you may avoid
If you have a small lawn, consider getting a push mower
instead of a power mower. It doesn't use any petrol, oil or spark
plugs, has minimal maintenance costs, and will do the job just as
well - and it will keep you fit!!
Replace your old thermostat with a programmable model -
they can save you £000's over the years.
Be sure to set your thermostat as low as possible in the
winter while still being comfortable. The closer your indoor
temperature is to the outdoor temperatures, the lower your overall
heating bill will be. If you're going away for the weekend, turn the
heating as low as possible - no point keeping the spiders warm!
If you don't have a programmable thermostat, you don't need
to set your thermostat at a warmer setting than normal when you
first get up. This will not warm your home any faster and it usually
results in excessive heating which costs you money.
Call your local utility company to see if they offer energy
audits. Many offer free or low cost inspections and free information
booklets that can help reduce your heating costs, or even loft
insulation at heavily discounted prices.
Check for window air leaks and repair them. You can do this
by placing a lighted candle near the windows. If there are leaks, use
caulking to repair them.
Check to see if you feel a breeze at the bottom of your doors.
Use a lighted candle and if it flickers you will know that air is
passing under the door. If so, purchase door draft excluders to help
block the flow which will keep your rooms warmer and use less
If at all possible, install double-glazed windows in your house-
Single pane windows, or windows that are improperly insulated can
account for up to 15% of your heating costs. They are often low
maintenance & can look nicer too, increasing the value of your
Turn off or lower the heating in rooms that are rarely used
such as cloakrooms. If you're having guests to dinner, turn the
heating on in that room a short while before they arrive -
cloakrooms are generally the smallest rooms in the house, so will
take hardly any time to warm up. Be careful as you need to ensure
that the thermostat sensors is not located in a room that you close
off, as you may actually make your boiler work harder as it tries to
warm a room you have effectively shut off.
Close doors to rooms that are not often used. This will keep
the boiler from heating more space than necessary.
Keep all your wardrobe doors closed. There is no need to heat
your clothes during the winter.
Once your house is up for sale, mystery shop the estate
agency and judge how it promotes your property. Ask for
properties of similar specification and see if they recommend yours,
& you will also get an idea of the competition.
Transferring assets may also be beneficial for avoiding
Inheritance Tax (IHT). Most lifetime gifts to individuals or trusts are
Potentially Exempt Transfers (PET's). No IHT is due on PET's if the
donor survives for seven years. Transfer must be outright but watch
out if the asset is sold immediately by the person who receives the
gift as this could raise doubts in the Revenue's eyes.
As both husband and wife have their own nil rate band for IHT
purposes you could share your assets, and write your Wills so that
on first death an amount equal to the nil rate band passes to your
children, and the balance to your spouse. When your surviving
partner dies the nil rate band applies again. Commonly called a
Discretionary Will Trust.
The most common route of purchasing a property with a
partner is joint tenancy. However, if you have a partner, you can
reduce your liability to IHT by over £100,000 by switching the
property from joint tenancy to tenants in common. This is where
each of you own a stated percentage of the property – normally 50
per cent. The next step is for each of you to make a Will, leaving
your own share to your heirs. When the first spouse dies, the child
or children inherit the agreed percentage of the house. Your
offspring can allow you to stay using their half of the property until
you die or the property is sold. When the second spouse dies, the
children inherit the other share of the home.
If you buy properties to 'renovate and sell', then you will be
taxed differently than if you only 'Buy and Let' properties. For
instance, if you buy and sell, your gains may be taxed as Income
rather then Capital Gains. This means that you need to establish
how and which taxes (Income Tax and / or Capital Gains Tax) will
be applied to your property investments. Once you know how tax
will be assessed on your investments, then, and only then, can you
establish a tax minimising strategy.
A cost effective way to own land is by 'annexing'. If you
extend your fence to claim a piece of waste land at the end of your
garden, then after 12 years you may be entitled to claim it as your
own. (Statute of Limitations Act 1977). This is not a simple process
though so make sure you use a solicitor.
Switch your mortgage immediately after redemption penalties
end to ensure you don't pay the lenders Standard Variable Rate.
Use draft excluders by your doors.
BTL - buy items off eBay as you can find real bargains, & if
the seller delivers, this will save you time.
30. Recycle - visit house clearance sales as there is always a
bargain to be had.
On Buildings insurance a common mistake is to cover the
house's market value (the amount it could be sold for), meaning
many people are over insured and paying too much for their
buildings insurance, when actually the amount you need to cover
(called the sum insured) should be the rebuild value. Therefore
location is less important than the value of materials, labour and
architects fees. However it's important that any building policy
covers the cost of an alternative residence for you if your home
were being rebuilt. Commissioning a survey is the most reliable
method to establish the rebuild value, but will be expensive unless
you're getting one anyway when buying a new home or remortgaging
an existing one. A less accurate, but quicker option is
ABI's calculator, or you could simply ask an insurer to give you a
rough value based on standard assumptions.
All insurance policy prices are based on risk assessments, so
to cut the cost, cut the risk. Such things as getting approved locks
and alarms, joining neighbourhood watch schemes will cut the cost
of your policy.
Increasing the excess on your policy - This can reduce the
cost by almost the amount of the excess!
Many dentists don't really need Accident, Sickness &
Unemployment insurance (ASU), and those that do can often get it
for half the price available on the high street.
As the global demand for power threatens to outstrip supply,
prices are rising. But that doesn't mean you need to be paying over
the odds. The domestic market for fuel is a competitive one and you
can change supplier with a few clicks of your mouse. Your new
supplier will take care of the formalities - you just pay less every
month. Look at www.uswitch.com
British Telecom (BT) may seem to behave like a monopoly but
it most definitely is not one. If you need a home phone there are
loads of cheaper alternatives from cable companies that package
your telephone, television and even broadband internet access to
low-cost dial-up services, & give you access to cheaper calls using
your existing BT line - sometimes even free!
If you have a mobile telephone contract with the Orange
network & are paying over £30.00 per month, they will offer you
free broadband connection as part of their service.
As a nation of obsessive DIY'ers, for around £100.00 you can
take a course at your local adult education college to improve your
skills needed to tackle most household repairs. You may even
qualify for tax relief on the cost if you have BTL properties!!
Do you pay your insurance premiums by monthly
installments? If so, you are probably being charged a premium of
between 15-20% APR for the privilege. In other words, if your home
and car insurance bill for the year is £600.00, you're paying up to
£120.00 a year in interest by paying monthly. If you are in a
position this year to save up for next year's premiums in advance,
you can save money by paying the whole lot in one go.
Barclays Home Insurance is promising anyone aged over 25
who hasn't claimed in two years, if it can't beat your renewal quote
it'll match it and give you £50.00 as well. The only fly in the
ointment is the most Barclays will reduce your quote by is £100.00,
so for some it may be cheaper to remain with your current provider.
Post Office Home Insurance currently gives £50.00 cash back
with every policy taken out, effectively making the premium £50
cheaper than normal. This is only available for new Post Office
customers, and they will take back the cash if you cancel within 12
A fee of one percent of the property's value and a lock-in
period of one week after written notice is received, are the kind of
offers you should aim for.
Turn off lights.
Reduce number / wattage of bulbs.
Use energy saving light bulbs.
Check the times when your heating comes on & goes off -
shaving a few minutes each day off the time could save you quite a
lot of money each year.
Property grants are available for loft insulation & draught
proofing - contact Energy Action Grants Agency (EAGA)
Means tested Disabled Facilities Grants (DFG) up to £25,000
could be available – contact your local council.
Empty Property Grants - Payable in respect of work required
to bring properties that have been empty for more than 6 months
back into use.
Offset Mortgages - ideal for people that have good credit
balances in a linked current account.
Everyone's main home or Principal Private Residence (PPR) as
the taxman catchily names it, is exempt from Capital Gains Tax
(CGT) when sold, but any other properties you own attract CGT at
your highest rate when sold. If you live in a property, then let it
out at al later date, you will be exempt from CGT for a period.
An unmarried couple may each own a home that qualifies as
their PPR but a married couple may only nominate one property and
must elect jointly, unless you have separated.
It is possible to cut CGT bills by living in the second property
for a period of time.
Special rules apply to properties that have been a main
residence. The period when it was the main residence is exempt
from CGT, plus the last 36 months of ownership. So a period when
the home was rented out may still be exempted for CGT purposes.
On the purchase of a second home, the owner has two years
to elect which of their homes is their PPR. They do not have to be
living in it at the time. After the two years, they lose the right to
make a nomination and the onus would fall on them to prove that
they were living in the second property if they want to avoid CGT.
Many people do not realise that the two-year election period
applies and fail to take advantage, however it is possible to revive it
if a third property is purchased, or if the second home becomes
your PPR for a period. This involves transferring bank, postal and
electoral details for the period to prove that you were resident and
perhaps even renting out your main home. Moving into a second
home will mean that a person's other home becomes liable for CGT
for that period, however as this will later return to their main
residence, issues should be minimal.
For those who have previously rented out their main
residences there is the added benefit of being able to claim up to
£40,000 letting relief. This is available to anyone with a share in the
property, giving a couple, even if married, up to £80,000 between
The amount of private letting relief that can be claimed
cannot be greater than £40,000 and must be the lower of that sum,
the amount of PPR relief being claimed, or the capital gains made
during the letting period.
There are other factors to consider that could further reduce
CGT liability. These include taper relief, which lowers CGT
depending on the length of ownership, and the ability of married
couples, or those in civil partnerships, to transfer part of the
ownership to the partner who pays the lowest rate of tax.
For the right circumstances (mainly sole traders or
husband/wife/partnerships) - Offset mortgage whereby credit
balances on linked accounts are offset against residential
mortgages. These not only reduce the interest actually paid, but as
you don't pay tax on the credit interest you would have received on
credit balances, its the Gross amount you benefit from.
Flexible mortgages to use savings (e.g. for tax or holiday
funds) to reduce mortgage until the funds are required.
Repay personal borrowing ahead of business borrowing as the
latter receives tax relief against interest paid, whereas the former
Linked to the last point, raise funds in your business name to
reduce private borrowing - subject to accountants confirmation to
Insulate walls / ceilings.
Install solar panels to heat water or produce electricity - there
will be an initial up front outlay but in certain areas there are grants
available - probably more cost effective longer term although this
could also increase the re-sale value of property.
Use draft excluders by your doors.
BTL - buy items off eBay as you can find real bargains, & if
the seller delivers, this will save you time.
Recycle - visit house clearance sales as there is always a
bargain to be had.
Utilise recycling facilities as this will reduce the number of bin
bags you use.
When driving by skips, have a quick look in - its amazing what
gems can be found such as cast iron fireplaces, which can easily be
restored & fitted into your own home making it more desirable for
resale - or you can sell it on www.eBay.com
When buying houses, furniture or other household goods,
always ask for a discount.
Don't leave TV's etc on stand by as this costs £00's over the
Switch off appliances at the plug which could reduce the risk
of starting a fire,
Wear more clothes in-doors particularly in winter.
Ask your local authority whether they have a discount price
for Compost Bins - saves you money and great for the environment
Do you remember the "share a bath" suggestion? Especially
important if your water is metered.
Investigate whether a water meter would be cost effective -
some advice suggests if you have more people in your property
than number of bedrooms, you might be better off.
Don't get emotional about buying property to let. Remember,
as long as the figures add up & the property is in an area where
lettings are relatively easy, do it!
Don't worry if you personally would not want to live in the
property. Everyone's needs are different!
Think neutral décor.
Choose hard wearing surfaces as prospective tenants do not
always treat rental properties as they would their own.
Always keep receipts relating to any spending on Buy to Let
Set up trade accounts - this will give you up to 2 months
credit, & discounts in many stores. Also if the store is part of a
chain, you may be entitled to discounts at other stores within the
group without applying for a trade card at that store.
Never take out extended warranties as these tend to be
expensive for the cover you get. If you have say four items
(dishwasher, washing machine, oven & hob), this could cost in the
region of £400.00 per annum. If you didn't have the cover, this
would free up this money to purchase new goods as & when old
ones become faulty. Also remember you generally receive 12
months warranty with most new items anyway & in our experience
most goods last around 4-5 years.
If your Buy to Let rent is all inclusive of bills, don't supply a
tumble dryer - its amazing how long people dry a pair of socks for
when they are not paying for the electric bill!
Check what other houses on the street have actually sold for
to make sure you're not paying over the odds - check on www.upmystreet.com
Buy property out of season to get a bargain, most people buy
in the summer, so there is more competition. October to March tend
to be the quietest time for the housing market, & this tends to be
the best time for deals.
Build good relationships with a reputable agent - they may
point you in the direction of a good deal – don't forget they usually
only get paid when a house is sold!
Re-negotiate the price if the survey shows any problems,
however small. You may save more than the price of the survey.
Consider buying off plan, as you buy at the price of when you
pay the initial deposit, rather than 2-3 years time when the
development has completed.
Learn from property mistakes - think about why you had a
tenant who cost you money and implement procedures to prevent
this happening again.
Don't stretch yourself too much – either financially or time
Pay off residential mortgage before Buy to Let/practice debts
to save on tax.
Don't buy houses that are in perfect condition, as you will
tend to pay top dollar.
Make sure you sell a property in a better condition than when
you bought it.
Paint your house in magnolia before selling or letting - this is
a neutral colour which is less likely to offend prospective buyers &
tenants, which in turn should provide you with a sale price closer to
the asking price or a higher rent from tenants.
Rent a room relief - you can rent a room within your home &
receive up to £4,250 per annum tax free.
Use energy saving light bulbs - these are cheaper to run, &
need changing less often - electricity suppliers will often send you
Ensure that you're not paying the standard variable rate on
your mortgage - discounts/trackers can save £000's
Discount mortgages can save you ££'s if the Bank of England
(BoE) base rate does not rise against a fixed rate mortgage - if your
confident that the BoE base rate will not rise, then stick with a
discounted or tracker rate mortgage.
In the USA, check to see if the purchase of an energy efficient
dishwasher will qualify for a state tax credit. Some states offer tax
credits on your personal income tax when you purchase an energyefficient
For those people that have enquired about Buy to Let
property and are "thinking about it" - do it or forget about it!!
Set your practice mortgage up on an interest only basis and
ensure your personal debts are paid off in full before paying off any
business debt - after all you don't get tax relief of up to 40% on
your residential mortgage!
Re-negotiate your current deal with your current lender.
If they don't agree, you may be paying well over the odds so
consider switching lenders.
Have a handyman available who you can turn to at short
notice for general repairs & maintenance - if a lock breaks its better
paying a retired gentleman for an hours work than a locksmith