All About Title Splits

Chris Richardson / January 30, 2019

Tags: Blog



Title splits are, as the name would suggest, splitting (or dividing) the title deeds of one building. As a result, that one property becomes two, three or four etc. It’s a smart property investment strategy – one which considerably increases the yield of that particular property. It can also significantly increase the size of your property portfolio.

But it doesn’t just have to be about properties which have already been built. You could, for instance, also purchase a plot of land and build two houses, rather than one larger home on it. You then record both with Land Registry.

You could also buy a property with a large garden (corner houses are good for this) and split the two. It would then be possible to build a house on the garden, and rent it out or sell it.

Best type of properties for a title split strategy

The larger the house, the more properties you should be able to split it in to. A large refurbishment property would be ideal, since it would be cheaper than buying a home ready to move in to. A former nursing home, guest house or old hostel would be ideal. Old tenement properties and large town houses are ideal too. Of course, you would have to factor in the cost of materials and labour to develop the premises in to individual flats to rent or sell. In other words, there’s no point going ahead if the refurb costs are going to be too much.

An easier way to get a large property without too much building work would be to find a property which has already been split (to an extent). This could include a HMO, where the landlord has decided he or she now wants to sell on and retire. There would still be building work, but it wouldn’t be quite as extensive – and you could always keep renting it as a HMO while you crack on with development plans. That way you would still make an income from the property and don’t have to rush in to anything.

Even if you sell the flats, it’s a good idea to hold on to the freehold and sell each individual flat as a leasehold property. This means responsibility for the common stairs and other maintenance issues related to the building as a whole, but it also gives you more control (and various pots of monthly income).

The complicated part

As you’ve probably already anticipated, there are a lot of areas to check before going ahead and buying what you consider to be an ideal property. Not only are there renovation costs, there are also legal hurdles (find a solicitor who is experienced in this type of property transaction to ensure the whole process goes as smoothly as possible). It’s also advisable to get a survey early, so you don’t waste time with an unsuitable property or piece of land.

Then, there are the planning considerations (you will have to submit building and planning applications to the relevant local authority) and the time implications (consultation periods can last months).

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Tags: Blog

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