When buying a repossessed property or PIP (property in possession) there are no transfer duties payable,unless you are a VAT vendor in which case they are payable.Transfer duties are often a major stumbling block for those who wish to purchase property in todays market,because although growth isn’t that great at the moment the prices are still pretty high for the man on the street.
So maybe buying a repossessed property will make your dream home a bit more affordable and you could proceed with any needed improvements further down the line.One should also remember that the banks are not as readily giving 100% bonds at the moment, so if this is a saving it could assist you even more.
Transfer duties account for approximately 8% of the purchase price of a home and one usually pays transfer duties unless one buys a brand new home or development.There are various other deals regarding transfer costs in the market but it sounds better to me not to have to pay them at all.
You also have to be careful,as with everything,that you do not end up paying more for your property now than what it’s going to be worth in the next couple of years.If you are offered some kind of assisted payment deal and you have it in your mind to resell that property a few years down the line try and figure out what that properties market value will be at the time you wish to resell.In some cases you will end up losing valuable growth on that property because of what you paid initially.
So even though not paying transfer duties does sound great i would investigate any deal offered to me for all long term effects on my portfolio.
Investors and buyers could contact the banks to get information regarding their repossessed property.One should investigate all opportunities even if one does not act on them.
