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Going buy to let: "So Sir, what's your strategy for paying back the capital?"

135

Comments

  • Mutton_Geoff
    Mutton_Geoff Posts: 3,819 Forumite
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    Thrugelmir wrote: »
    Consent to Let is normally determined on a case by case basis. Some lenders only view this as being a temporary arrangement.



    Quite, but isn't life itself a temporary arrangement?
    Signature on holiday for two weeks
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
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    pph wrote: »
    It's appreciated 70% in value since Aug 2012.. but with Trump / Brexit / Goodness knows what... hence I am being conservative with the 3% thing.

    If we sold it tomorrow we'd easily pay back the principal of the loan.


    If you can find a buyer. You need to get it on the market ASAP, and be prepared to drop the price IMO.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    Mutton_Geoff wrote: »
    Quite, but isn't life itself a temporary arrangement?

    Life is more often or not longer than say 3 years. ;)
  • BLOW_FLY
    BLOW_FLY Posts: 115 Forumite
    OP what if house prices go down? Your >3% pa growth plan is instantly obliterated.....

    Have you considered all the angles of being a LL?


    BF
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
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    https://audioboom.com/posts/5793636-sell-up-hold-or-expand
  • pph
    pph Posts: 142 Forumite
    Thrugelmir wrote: »
    Don't you want to buy a property where you move to?

    We'd have to sell the place in London:

    a) I believe that if there's one place in the UK property prices are going to be maintained / stay rising is London
    b) For personal reasons, we want out of London ASAP and don't want a 6-9 month transaction
    c) It's a buyers market now... maybe in the next cycle when the economy picks up and there's more demand we'll think about it
    d) My job starts 1st June


    Overall, no-one's got a crystal ball but we bought in an "up and coming area". Since then there has been a massive injection of cash to promote regeneration, they have pedestrianised the high street, crime has fallen, there's an HS2 station being planned for nearby.....

    Overall, we'll make a good margin on the BTL mortgage repayments on the London property and the price we rent it out for. This will allow us to offset the cost of renting in the new town.
  • pph
    pph Posts: 142 Forumite
    edited 17 April 2017 at 11:52AM
    BLOW_FLY wrote: »
    OP what if house prices go down? Your >3% pa growth plan is instantly obliterated.....

    Have you considered all the angles of being a LL?


    BF

    We can pay back the bank in 20 years if house price inflation is zero and the property is worth the same in 20 years.

    We can pay back the bank loan in 20 years if house prices fall by 60% in 2037 - but will this happen? I am willing to take the risk it won't.

    And as already said:
    ACG wrote: »
    If you plan on selling the property, that answer will be fine.
    Typhoon2000 wrote: »
    As mentioned before, sale of property is a perfectly valid answer for a BTL and you do not need to qualify anything or justify what you think the property will be worth in 20yrs at all. Banks are not interested.

    My personal belief is that after 5 years when we know where we stand in the world with respect to Brexit and Trump, that the economy will stop wobbling and prices will go up again, and more than 3% per annum on average. And the longer house prices stagnate.....

    http://www.bbc.co.uk/news/business-37864258
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
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    http://www.telegraph.co.uk/investing/buy-to-let/oxford-academics-house-prices-can-keep-rising-government-backs/
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
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    https://www.gov.uk/guidance/changes-to-tax-relief-for-residential-landlords-how-its-worked-out-including-case-studies
  • pph
    pph Posts: 142 Forumite
    Well after Mrs May's decision to call an election, looks like hanging onto the property and BTL instead of selling might prove to be the right one. Can't see house prices going up for a little while now....
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