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Buy to let advice - would you go ahead in the current market?
Comments
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Doozergirl
You say "I am in the process of buying a BTL at the moment. I've found the right house with the right yield"
Come on spill the beans , how much are you paying and what rental are you receiving. What is your area. I still don't believe it can be done0 -
Doozergirl
Also , sorry not very clear , have you a repayment mortgage or IO0 -
Repayment mortgage. I'm paying £69,000. Market rent is £500.Everything that is supposed to be in heaven is already here on earth.
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Anyone saying that 'buy to let is dead' is making a very general statement that isn't true of the whole market. While returns are nothing like they were a few years ago there is still money to be made in renting out property.
One of my clients recently bought a number of HMOs. He purchases them for about £190K and rents them out to students for about £1600 a month. The rent covers the mortgage, insurance and other monthly costs and gives him £500 a month profit. While the capital appreciation is negligible right now he's still taking home thousands of pounds each month from his portfolio.
It sounds like the original poster is looking at a flat as they mentioned maintenance charges. If you want to get into property investing then how about changing the property type to something like a HMO where you won't have to subsidise it each month?
Welcome to the forums.
Have I got this right? Your client rents to students for £1600 for 10 months of the year (September to June). That is £16,000 - £6,000 (his profit 500 x 12) = £10,000. £10,000 divided by 12 months = £833
Does this £833 cover his 190k mortgage plus HMO bits + insurance + EAs fees + repairs?RENTING? Have you checked to see that your landlord has permission from their mortgage lender to rent the property? If not, you could be thrown out with very little notice.
Read the sticky on the House Buying, Renting & Selling board.0 -
Wow - thats cheap, what part of the country? It wouldn't buy you a garden shed down on the south coast
I can see that making more financial sense but I guess you won't stand to make so much from property price rises?0 -
I can see that making more financial sense but I guess you won't stand to make so much from property price rises?
I could always buy three of them?!
You are on the wrong track looking for significant capital gains in the medium term. There isn't a hope in hell of property prices doubling from this point over the next 10 years.
You are relying on luck. I am looking at something that already works financially. If it goes up in value one day, then great, I've been 'lucky' I but if it doesn't, it actually doesn't matter to me. I'll have a house that is paid for by someone else.
You are laying yourself wide open. There are people on this board that won't even buy a house. I'm not one of those people and I'm telling you that you are right to have second thoughts.Everything that is supposed to be in heaven is already here on earth.
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Do you really believe this hysterical nonsense? or do you just say it for effect. If its the latter fair enough but if its the former you are a deeply dilusioned indiviual. ;-)
If RPI remains at 4%, prices falling by less than a quarter over 4 years would give you a 40% correction.
House prices are currently overvalued on an unprecedented scale. I wouldn't say that scenario is in the realms of nonsense at all.Hi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
Do you really believe this hysterical nonsense? or do you just say it for effect. If its the latter fair enough but if its the former you are a deeply dilusioned indiviual. ;-)
So presumably the International Monetary Fund is composed of deeply disillusioned individuals?
Or maybe it's composed of internationally renowned economists and you don't have a clue what you're talking about?
http://business.timesonline.co.uk/tol/business/money/property_and_mortgages/article2681755.ece
"In a bleak warning, the IMF found that homes in Britain were overpriced by up to 40 per cent — far more than the overpricing in the US before the current property slump began there."0 -
The problem here is because they say house prices are over valued at x% you then jump to the conclusion that they will then surely fall by this % to reach their statusquo. This isn't going to happen.
The more likely scenario is for prices to level off for a few years during which time this over valuation will disappear.0
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