thinking about renting

confused31_2

I currently have a house, we was going to move but with the market falling we are thinking of renting our current house and buying a additional one.

Im not going to consider this yet, but if houses fall even more i think i will be able to afford to buy one house as well has keeping my current home, i think its worth it as it will be a bit of a investment for when we are older.

has anyone got any tips for me, any help would be appreciated to what cost's and mortgages i should be looking at, ive also been told about homelet.

should i rent myself or should i use a agent??

domcastro

The problem is - lots of people are thinking this. There is a glut of property to rent. (most of which are also on the market)

BTL mortgage rates are bad at the moment. You'd need a huge deposit just to get any return on your investment

Letting agents fees range from 9 -15% depending on management level.

To get a BTL mortgage the annual rent has to be (approx - depending on lender) 130% of mortgage payment and letting fees.

So (haven't got a calculator so approx)

if your mortgage payment is 500 and the fees 50. You'd need about 700 pcm for rent

confused31_2

ive looked at the buy to let mortages and i have enough equity to secure the mortgage, i would be paying 200 pounds month on the btl mortgage interest only.

I dont think there would be a problem with getting someone to rent as the area is quite sort after and not many houses come up for rent.

my mortgage would be 860 pound a month on the new property and this would be rapayment, even if i get 600 pound of therented house, it will bring the payments down to 460 pound and it would also pay the 200 pound for my other mortgage.

i need to know what would i need to do to my house before i can rent it out?

My missus thinks its a lot of hassle i suppose it is, but i think it will be worth it, if i get 650 pound rent a month how much of that will go towards my repayment mortgage and how much will the agent get??

How long do you have a contract for?? 6 or 12 mnths??

confused31_2

Im going to contact a letting agent, and let them do it all as long as i can clear 500 pound a month ill be happy, cheers for the help.

domcastro

Good luck. I think paying a LA is the best move - let them have the headache. They credit check tenants as well

EDIT: It's best not to make too much profit or you'll have to pay tax

confused31_2

Im hoping the profit will pay some towards my other mortgage.

cheers for the help.