flat purchases in salford quays

slipthru

Dithering_Dad wrote: »

I'm assuming that prior to signing up for these properties, you did sufficient research to ensure that the rental demand was there and I'm also assuming that this was always going to be a long-term investment.

If this is the case, then I'd suggest you hold onto the properties than to just throw away £24k of your hard earned cash. Use the time until they are built to get as much money together as you can as buffer for non-rental periods and then continue with your rental plan. The value of the apartment is immaterial provided your rent covers the mortgage and if not, as long as you can afford to cover any shortfall.

To turn it around, had you bought the properties and they had gained £24k, would you then be rushing to sell them to grab this profit, or would you just carry on renting them long term until they were paid off (and then provided rental income in your retirement)?

Try and remember why you entered into the BTL market. If it was for a quick buck, then you've been burned. If it was for the long haul, then the value of the property doesn't matter a jot as long as you can afford the mortgage.

If these property's were to lose £40k over the next 3-5 years and there was to be a stagnation for say another 5 years and then slow rises to the price you paid over another 5-10 years is it still worth the hassle?

That's a hell of a long time for you to hang onto an investment, is it really worth it?

Dithering_Dad

slipthru wrote: »

If these property's were to lose £40k over the next 3-5 years and there was to be a stagnation for say another 5 years and then slow rises to the price you paid over another 5-10 years is it still worth the hassle?

That's a hell of a long time for you to hang onto an investment, is it really worth it?

What's the hassle? I'm assuming the chap was going to rent out his BTL's for more than 5 - 10 years anyway. The value of the flat has absolutely no bearing on the 'hassles' involved in renting the accomodation. There are no more and no less hassle involved when house prices are falling then when they're rising.

5-10 years is not a long time to invest at all, especially in property. My pension has been going 13 years so far and has another 26 years to go. Many people purchase BTL's to supply a retirement income, in which case 10 years is a drop in the ocean. We're not talking about someone's home, where they're stuck in neg. equity and can't move for 10 years. This is an investment property.

People should focus on why they bought their BTL's. If it was short term gains in property prices then they should get out now. If it was for the 'long-haul' to provide retirement income via property rental, then a drop in the market is immaterial.

If they have to supplement tenants or pay down the mortgage to get onto a safer footing, so be it. It'll be hard and perhaps they might have to make some cut-backs in their lifestyle, but in the end they'll reap the benefits when they retire.

girleight@

Hmm though if the studio concept is flawed maybe there is a long term problem. I feel claustrophobic just thinking about living in an apartment like that.

neverdespairgirl

Dithering_Dad wrote: »

What's the hassle? I'm assuming the chap was going to rent out his BTL's for more than 5 - 10 years anyway.

The rental yield on these looks dire, though, don't you think?

Dithering_Dad

girleight@ wrote: »

Hmm though if the studio concept is flawed maybe there is a long term problem. I feel claustrophobic just thinking about living in an apartment like that.

It depends on the market you're aiming for. I'm currently working down in London on a 6 month contract and rent a studio apartment. I'm there from Monday evening until Friday morning and it's totally fine for my needs.

I certainly wouldn't want a larger place because of the extra cost in rent, council tax, heating and due to the extra effort in cleaning.

neverdespairgirl wrote: »

The rental yield on these looks dire, though, don't you think?

Dunno, I haven't done the sums but I'm assuming the OP has, and is happy with the returns?