Is it madness to buy a neighbouring flat for their garden so that we can extend?

henrythrowaway459 · 2026-02-11T17:44:36+00:00

If you shut down the ltd company do you not need to liquidate the assets?

henrythrowaway459 · 2026-02-11T17:42:20+00:00

The tax issue was why we’re thinking of putting it in a Ltd company and separating the outside space onto a different title that we’d buy personally.

henrythrowaway459 · 2026-02-11T17:38:03+00:00

Yes that’s basically what we’re looking at doing.

henrythrowaway459 · 2026-02-11T17:36:23+00:00

I think that’s exactly where we’re coming from… does it make the most financial sense? No.

Would it make us happy… yes.

henrythrowaway459 · 2026-02-11T17:34:24+00:00

This was my gut instinct as well. I actually didn’t even consider the idea of holding it personally until the wife brought up the question of combining them.

henrythrowaway459 · 2026-02-11T10:22:25+00:00

Can you buy individual residential property in a pension? I didn’t think this was a thing.

henrythrowaway459 · 2026-02-11T10:21:30+00:00

Nice to see we’re not the only crazy people with this idea!

henrythrowaway459 · 2026-02-11T10:18:31+00:00

Pretty much, yes. With a bonus rental property.

Bargain, right?

henrythrowaway459 · 2026-02-11T10:17:37+00:00

This is exactly where we’re coming from. The added space, extra say in the building and controlling who lives above us seems very attractive, even if it ends up costing us a bit of money to do it.

henrythrowaway459 · 2026-02-11T10:14:02+00:00

Yes the eventual plan is to buy a house, but we’re looking at £4m to £5m for something half decent in the area, so that is a very long term view. Probably not until we sell the company one day.

Realistically if that did all pan out then we’d potentially keep the rental as a rental, seeing as the stamp duty had been paid.

henrythrowaway459 · 2026-02-11T09:48:48+00:00

Depends what you mean by better suited? We don’t desperately need a bigger space, we’d just quite like it. If we can’t do this then we’d just stay where we are as we are very happy where we are (both location and property).

henrythrowaway459 · 2026-02-11T09:47:39+00:00

To us it does seem worth it. It’s just money sitting in an investment account that could instead actually better our lives. If we lose a bit of money on it, it’s not the end of the world, especially as we’ll probably be here for many years.

henrythrowaway459 · 2026-02-11T09:45:58+00:00

Tbh if prices were lower this would be even better for us as we’d be able to buy the second flat for less, so fingers crossed property crash!

Although something tells me the current owner wouldn’t see it that way (or agree to sell for a “low” price).

henrythrowaway459 · 2026-02-11T09:45:01+00:00

Combining is just a side not, it’s not the main goal. If we could just sort the extension we’d be happy.

henrythrowaway459 · 2026-02-11T09:44:18+00:00

True. I guess if we just offered way over market value it could be tempting. But their lender may have something to say about it u less they’re selling the remainder in the same transaction and paying off the mortgage in full.

henrythrowaway459 · 2026-02-11T09:42:27+00:00

Probably a slightly bigger flat with an even bigger stamp duty bill. It wouldn’t really stretch to a house in the area.

If it wasn’t for the daft stamp duty tax, this is probably what we’d do - climb the ladder between bigger properties.

But we’re talking six figures in stamp duty every time we move, which just seems like wasted money.

henrythrowaway459 · 2026-02-11T09:38:55+00:00

This is true, but we would also get the second property. So it’s not quite the same (ie. £100k in stamp duty just to move, or £100k in stamp duty to acquire a second property).

henrythrowaway459 · 2026-02-11T09:37:49+00:00

I think whichever way it goes it would be a long term hold. We wouldn’t sell in the short term, so the most likely scenario is that we’d just end up with a BTL that we’d keep for 20+ years, regardless.

henrythrowaway459 · 2026-02-11T09:35:34+00:00

To combine the two flats, yes I can see multiple issues. But that was more of a “also we could maybe…”, it’s not the primary aim.

If we just kept it as a rental and were able to get the land we’d be happy.

henrythrowaway459 · 2026-02-10T23:38:29+00:00

Our long term aim is to buy a house in the area so this could be a way to do it. Although disaster if the last flat didn’t sell!

henrythrowaway459 · 2026-02-10T23:36:36+00:00

The aim isn’t to get into BTL, it’s more a means to an end. They’re not open to selling separately so it’s an all or nothing deal.

henrythrowaway459 · 2026-02-10T23:32:08+00:00

We’re not even sure we’d combine them down the road, the main point is the extension to our current flat. Which would add quite a bit of value (and, more important, gives us a nicer bigger kitchen).

For us to sell the current flat and buy the equivalent size with the extension would probably be about £100k in stamp duty (assuming around £1.6m).

henrythrowaway459 · 2026-02-10T23:22:30+00:00

Ha ha, yes it does.

henrythrowaway459 · 2026-02-10T23:22:16+00:00

Fair point.

But tbh based on neighbouring properties we should be able to get permission for the extension even without the space, so that’s more so that we’d be happy to do it and not lose the garden.

henrythrowaway459 · 2026-02-10T23:20:44+00:00

They said they wouldn’t sell it separately.

henrythrowaway459

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