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Is this a good idea or not!!!!
wuzzbert
Posts: 54 Forumite
Right, hi to you all, i'm new here and need some advice!
I invested some money in shares 5 years ago and ended up VERY LUCKY doubling my money and decided to get out whilst the going was good.
I now have 25k sitting in a 5.3% savings account.
I also have a house that I owe 46k on but is worth 160k which I live in on my own!!
I was thinking of buying a second property with the 25k as a deposit and either renting it out OR moving into it and renting mine out in a scheme my mate told me a bit about known as 'let-to-buy'.
My question is do you think any of the above is a good idea at this moment in time. I dont know much about the property market and there are loads of conflicting speculation knocking about concerning which way prices will go.
What else could I do if not the above; buy back shares, pay more off my mortgage? Please let me have your thoughts, thanks
I invested some money in shares 5 years ago and ended up VERY LUCKY doubling my money and decided to get out whilst the going was good.
I now have 25k sitting in a 5.3% savings account.
I also have a house that I owe 46k on but is worth 160k which I live in on my own!!
I was thinking of buying a second property with the 25k as a deposit and either renting it out OR moving into it and renting mine out in a scheme my mate told me a bit about known as 'let-to-buy'.
My question is do you think any of the above is a good idea at this moment in time. I dont know much about the property market and there are loads of conflicting speculation knocking about concerning which way prices will go.
What else could I do if not the above; buy back shares, pay more off my mortgage? Please let me have your thoughts, thanks
0
Comments
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You have come out of an equity investment at a time when equities are not considered to be overvalued but are considering an investment area that is considered to be overvalued.
Doubling your money in 5 years isnt very lucky. Anything above 70% is what you would expect for that period on a medium risk or higher investment (5 years to end October was 62% for sector average returns only).
A mortgaged buy to let (or let to buy) is higher risk than equities and the potential is not much different. After all, properties generally havent doubled in the last 5 years and potential going forward isnt great. Plus you have tax to be concerned with.
If you fancy property exposure at lower risk than a mortgage buy to let then investing in property funds.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
To be honest I'm not really concerned about property, just thought it was the way to go. So what would you do in my position? (thanks a lot BTW)0
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What's the interest rate on your current mortgage? If you're playing a long game, paying off debts and thus reducing the total you'll pay is a good idea.0
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Put the 25K into making a successful business 12% per month if you can be bothered)0
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Id pay off my mortgage with that 25k. Or at least 20 of it. And invest the rest:beer: Well aint funny how its the little things in life that mean the most? Not where you live, the car you drive or the price tag on your clothes.
Theres no dollar sign on piece of mind
This Ive come to know...
So if you agree have a drink with me, raise your glasses for a toast :beer:0 -
Put some of the funds into the new REITs - commercial property has a steady growth rate and is comparatively undervalued vs. residential property. In addition, the rental income generated by the REITS has to be paid out to the shareholders. You also can get global exposure with REITS. Other advantages are liquidity if you want to sell and no hassle with tenants and all the rental regulations.FREEDOM IS NOT FREE0
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What kinda business and where do you get these 12% and 39% from0
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Wuzzbert,
I think the 39% business suggestion was a tongue-in-cheek joke.Well life is harsh, hug me don't reject me.0 -
I would pay your current mortgage completely off and then buy a nicer new place which you can afford with your salary, rent your old place out and use the rental income for the mortgage of your new place. You should then use your salary to overpay as much as possible but where there are periods that your rental place isnt producing any rent then you have the means to cover it with your salary.
You can do a similar thing with your let to buy but it just means it is slightly riskier. The above should be more sensible something you need to be in the current climate.0
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