Buy to Let Gibraltar

Last activity 18 April 2014 by Andy1964

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GrumpyOldBlokeSerial expat18 July 2013 05:44:52

344

This post has been prompted by comments on another thread.
Buy to Let
Water Gardens 2 bed smaller flat.
Purchase price in a letable condition £240,000

Rent £1000 / month =£12,000
Expenses
Rates £400
Service Charges £1100
Insurance £100
Repairs and Agents fees, Agents charge one months rent per let , repairs will depend on many factors including the tenants , but for this exercise lets put this combined figure at £1250 pa.

So annual income £9150 Taxable

This is assuming continuous occupancy and in order to obtain this a slightly lower rent would be advisable.

£240,000 in the bank.

Government Debentures pay 5% interest

So annual income £12,000 pa, no expenses and Tax free.

The future.
Investing in property has always been looked upon as secure long term, however I do not believe it is likely that property will increase in value at anything like the rate it did a few years ago.
Money in the bank, the figures above indicate this is the best investment, but what does the future hold for interest rates???

avocastreetrandwickActive member23 July 2013 10:52:49

Hi Grumpy,

Instead of buying property to rent out in Gib after we sell our UK house, your interesting post made me check the Govt notice on
5 year Government Debentures paying 5% interest annually. Are these limited only to certified residents of Gibraltar, is there a residency limit eg 3 or 5 years?

thanks NIck.

GrumpyOldBlokeSerial expat23 July 2013 11:48:37

344

Hi Nick

To the best of my knowledge they are available to residents only but I know of no time limits.

Grumpy

PS

Just read the application form again and it would apper that residency is not a requirement for the 3 & 5 year bonds but it is for the 10 year ones. :-

If you are not resident in Gibraltar, interest earned on your holding of debentures may be subject to either
withholding tax or exchange of information in accordance with the Taxation (Savings Income) Act 2004 and the
Income Tax (Savings Income) (United Kingdom) Regulations 2006

avocastreetrandwickActive member23 July 2013 13:47:21

Hi Grumpy,

thanks for the very valuable info! You've made another grumpy old bloke very happy. Instead of buying property to rent out in Gib after we sell our UK house, your logic seems irrefutable, we buy 5 year Government Debentures paying 5% interest annually, tax free. Property might have a marginally higher return but as you say there are unforeseen costs - untenented periods, upkeep, maintenance, wear & tear, & of course the estate agents' letting fees. Sounds good! Incidently would you say a flat, lettable at £1k/mth would cost as much as £240k? Some of the flats whose details I saw, admittedly on DTRd, were well below that to buy, eg Wellington Crt & Northview Terr, both on the main Rd etc, but for others which were to be let, the asking price was usually £1k/mth.

NIck.

GrumpyOldBlokeSerial expat23 July 2013 15:14:59

344

Hi Nick

You are paying £1k per monthfor this type of flat

http://propertygibraltar.com/details/fo … 3_G/936/RS

The kitchen is the original tiling from 20 yrs ago.No photos of bathrooms???

So maybe a few extra expenditures, but you may get a bit knoced off.

Grumpy