making money from property!!

elliotskeeper

hi all this is my first post so i apolagise if this seems a stupid question but any helpfull replies would be greatly appreciated.

me and my partner live together in a house currently on a mortgage. when we bought the house it was an empty shell, so with a friend i did the plumbing, electrics fitted the kitchen etc, pretty much did everything with my friends help although i had no prior experience.

ever since i have been waiting for the chance to buy a run down house to do up and re-sell at a profit, recently i was left around £70000 and i am really keen to use this money to to do just that. i have got some knowledge of the housing market but not enough that i am that that 85+ % i want to be before i carry out my plan.

basically my questions in the current market is it wise for me to start in my scheme? or should i leave it a while?

my long term plan is keep doing this to make a living. i am in the army and see this best way to a financially better life for me and my family, if anybody can give me any advice it would be greatly appreciated?

thanks
elliot

Rabiddog_2

So, You want to go into a business for which you are completely untrained, with start up capital of £70,000? Plus you'll be away for long period s of time? Not a great Idea especially at the present time. Sadly it seems every man woman and their Dog had this idea in the last five years, an awful lot of them are currently watching their pensions/ savings dwindling in value to 70%, 50% or even LESS than zero in the present downturn. A nice ISA for two years plus...

elliotskeeper

i am not planning on going in to this head first i am gathering as much information as possible before i start. belive it or not you do get alot of holidays in the army and i plan on do this locally to where i am based near manchester. so i will have weekend and nights.

i am just after any advice as everybody has to start somewhere?

Millburn_farm

Elliot; my trip into being a landlord started with your exact stake £70,000, but that was 9 yrs ago, I had a house with 10 yrs mortgage paid (on a £23,000) and somewhere to go rent/mortgage free (My hubby's farm cottage), oh and I live in a part of the country that seems to avoid the crashes that happen else where; we just freeze; well we did in 1991 and now.

Tennants come in many guises; some great and some soooooo bad you don't want to know (well you do, 6 yrs ago; £9,000 damages court awarded after 5 months occupancy; oh and they threatened to pursue me for theft of the remote they left behind), I had fag burns in lino, chew marks from dogs not even allowed in new hardwood windows, roofing nails at 5ft all round the living-room, emulsion all over the same colour gloss, so needed a professional to redecorate the WHOLE house, it took me, my hubby, his 2 boys and my best friend 4 days to clean up, just to see if the carpets needed replacing.


in most markets you either pay an agent 10% I think; or it's you doing the interviewing, cleaning up after (I had breeding persians once), on the interviewing side I had a girl (with blind sister) who insisted she worked for the secret service; looking after the Royal Family; I was given a moblie number only for reference checking; now she didn;t know (well why should she) that I have experience of said department, and I had a landline to contact incase of emergency; oh and the "place" she was based at, didn't exist, my solicitor checked, and someone up here would have let onto him, and from him to me.

With £70,000, and on active service, I'd talk to a proffesional, or if you have to buy a house to rent out, buy it next door to a relative who can keep a more than good eye on your investment


Basically I'm saying being a landlord is oddles of hassle and very little reward unless you get lucky

dys

the short answer is that I don't think you are wise, you are in a falling market; a market which requires a skilled and experienced property investor. I fear that you have watched too many property !!!!!! TV shows and have been sucked into the mentality that property only goes up. "Renovations" (I use that term loosely) generally over the last decade have not added value, what has added value is house price inflation. Try doing "improvements" to a run down property now and see how much value is added... if the words contain magnolia, conservatory, en suite then fuhgetaboutit.
But hey maybe you are a born renovator, try your skills out on a cheapie, ie a 20k house in Blackburn Lancashire. If you can't add value there then don't go elsewhere: it's a cheap lesson in where you skills really lie.

Millburn_farm

Actually Elliot to quantify my last sentence; income from my house last yr (with a good paying, low maintenance great tenant) £3800; out-goings in much needed new kitchen £4200; luckily I don't pay tax, but even as (apart from my 1 property/house) a none taxpayer; I'm longterm quite severily disabled it's a pretty poor return on a property I care about; it's value is a plus; from £23,000 19 yrs ago to £115,000 now, but then it will (always was a slow selling street) take at the hight a yr to sell, and now although no "real" drop 18 months to sell


I'm a landlord for emotional things; i.e. I can leave him anytime, and I'm independant of him; I don't see how anyone working fulltime, away from the property, with family can be a real profit making man

elliotskeeper

i realise we are in a falling market and i am not planning on doing this tommorrow. this for me could mean waiting 6 months... a year.... maybe longer. i have people around me who have got knowledge of the housing market. my partner has been an estate agent for 4 years but has been out of work for a while due to us having a child. also my mother is a mortgage advisor.

i also have alot of friends in the building trade.

i am not naive enough to think can make loads of money straight away!

i have read alot of the posts on topics relating to questions like mine and there is clearly alot of knowledge floating around this site.

the impression i am gettin thus far is that because i personally have not done this before i shouldn't do it. i agree that it would be stupid of me not to explore every option, of which i am trying to do.

if anybody has been in my position wheather good/bad experinces please enlighten me?

david29dpo

I started 8 years ago, like yourself, with common sense. Made a good living buying re-pros and rundown houses, did most if not all the work myself. 9 houses later i have stopped, for now. The last one went on the market the day northern rock went titts up. Had to rent it in the end, something i dont like doing but it covers its cost with a bit left over. What i am trying to say is dont take to much notice of the doom & gloom lot, you can (you should) see what happening to the housing market at the moment for yourself and I would'nt be buying anymore for the moment. But i know people who are, people a lot braver than me!

Incisor

david29dpo wrote: »

I started 8 years ago, like yourself, with common sense. Made a good living buying re-pros and rundown houses, did most if not all the work myself. 9 houses later i have stopped, for now. The last one went on the market the day northern rock went titts up. Had to rent it in the end, something i dont like doing but it covers its cost with a bit left over. What i am trying to say is dont take to much notice of the doom & gloom lot, you can (you should) see what happening to the housing market at the moment for yourself and I would'nt be buying anymore for the moment. But i know people who are, people a lot braver than me!

:rotfl::rotfl::rotfl: Err? Doom and gloom to me means property going up up and away for ever. But I think most of those you would class as doom and gloom would be saying don't buy anything for the moment.

Incisor

Millburn_farm wrote: »

Actually Elliot to quantify my last sentence; income from my house last yr (with a good paying, low maintenance great tenant) £3800; out-goings in much needed new kitchen £4200; luckily I don't pay tax, but even as (apart from my 1 property/house) a none taxpayer; I'm longterm quite severily disabled it's a pretty poor return on a property I care about; it's value is a plus; from £23,000 19 yrs ago to £115,000 now, but then it will (always was a slow selling street) take at the hight a yr to sell, and now although no "real" drop 18 months to sell ...

I think elliotskeeper is looking to do up and sell on.

Bf109

elliotskeeper wrote: »

my long term plan is keep doing this to make a living.

Wow, you want to do it for a living?

!!!!!! its not like the entire country has already had this idea with thousands of people putting it on over the last five or six years now.

Its not like we have been bombarded with lifestyle TV programs about talentless spivs doing just this three or four times a day.

Its not like the biggst housing bubble in history is in the process of turning into the biggest crash in history.

You're in the army? Were you stuck on a remote desert island for the past six years with no TV and no radio like that japanese bloke in the 70s?

Buying a house as a home now is just a bit of a bad idea, financially. Buying property as an investment now is like buying stocks in the World Trade Centre (New York) Plc on the 12/09/01.