What Is Title Splitting and How Do I Do It? pt.2

How to do a Title Split as a landlord or developer

Which properties are best for Title Splitting?

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

Finding pre-split properties

An easier way to get a large property without extensive building work would be to find a property that has already been split to some extent. This could include an HMO, where the landlord has decided to sell and retire. There would still be building work required, but it wouldn’t be quite as intensive. You could always keep renting it as an HMO while you proceed with development plans. That way, you would still make an income from the property and wouldn’t have to rush into anything.

Retaining the freehold for long-term benefits

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 taking responsibility for common areas and other maintenance issues related to the building as a whole, but it also gives you more control and provides various streams of monthly income.

What are the legal frameworks and requirements for Title Splitting?

Planning permission?

Property owners must obtain planning permission for splitting a property into two titles. It makes sure that the division and splitting align with local development plans. The proposal’s impact on the local area is looked at, considering factors like access, design, and if there’s a potential strain on services.

Navigating building regulations

When splitting a property, you have to comply with these regulations. Structural integrity, fire safety, energy efficiency, and access are all very important. You must make sure that the newly created units meet these standards. Seeking advice from a professional is advisable to navigate these complex requirements.

The Land Registry

The Land Registry is responsible for registering land and property in England and Wales. Once planning permission and regulatory compliance are in place, your next step is to submit detailed plans of the divided property and legal documents to the Land Registry.

How to split a property title: Starting with land

In terms of land, the first thing to note is that you need to be really careful when you Title Split it. Imagine two pieces of land side by side with each other. Often with land, you can split one side away from the other side.

What we suggest is, if you’re planning to do this and build on this land, that you do it upon sale, because you don’t know what might happen. A good example would be that you buy a house, renovate it and then have a massive free garden that you plan to build on. Many people would say, “I want to buy a property like that and get planning to build on the garden.” Some people may even be sitting in a house where they could potentially build on the garden. The reality is, if you do that Title Split too early, you may have to do it again because you’ve done it wrong. That is why we would suggest you build the house in the garden. Then, when you go to sell the old house, you split at that stage.

Title Splitting mixed-use properties and apartments

The next aspect is apartments or mixed-use buildings. Think of a commercial shop at the bottom with residential properties above. There are many of these out there that are unsplit. They physically exist, but they don’t legally exist.

You will need a whole power team of professionals around you to enable the split of that building. Those professionals need to understand it. If you are a landlord who has tried to do this before, you will have gone to your solicitor who will have told you to wait till you sell. You might have gone to your mortgage broker who may not have been able to get you the right product. You may have gone to your accountant who may have told you not to do it at all and to do it when you sell. So you, as an investor, are going round and round in circles trying to find help.

Now, lucky you. You’ve landed in the right place, as we have years of expertise here. You need a whole team – a power team, we call it – of experts. The good thing here at Title Split is that when we work with our clients, we give them access to that power team panel of experts whom we have trained to do this on behalf of property developers and landlords.

What is the value add in commercial property Title Splitting?

The value add in the residential sector is where we get the 25% to 35% capital uplift. In commercial property, the value add comes from having small units that have a higher cost per square foot when you rent them to commercial businesses. So if it’s big, it might have a smaller cost per square foot. But if it’s broken down into smaller units, it will have a bigger cost per square foot for rental, which means you are going to make more money on it. Commercial property looks at rent, yield, and square footage valuation, so you will be able to get more money out of your deal by creating smaller units.

How can I Title Split across different properties?

The great news is that the processes we teach are exactly the same for commercial property, mixed-use property, and residential property:

• If you need to get something into your SSAS, and you want to split property to get it in your SSAS, we’re the experts at that.
• If you want to find out exactly how to do Title Splitting to achieve that 25% to 35% capital growth for new blocks, we can help you do that.
• And if you want to add massive value to existing blocks, we can help you do that, too.

While this may seem too good to be true, the good news is it is true, and you can benefit just like the hundreds of people we have helped. Contact Title Split and we’ll show you exactly how to navigate Title Splitting, we’re a click away!