BTL on Studio flat

shane42

i have been told it is not possible to get a BTL on a studio is this a new thing, and is there any way round it please,

declaration

I applied for a mortgage on my flat which I rent privately (it's 2 bedrooms, not a studio) and was told that the banks were very reticent to lend on new build properties (my flat is 18 months old).

I don't know how old your studio flat is, but the banks don't seem keen on studio flats or new build flats. I think there was a lot of fraud involved in new build properties at the height of the market, so this may be an influence.

seven-day-weekend

I personally don't think it is a very good investment with a studio.

Old_Git

difficult to tell the real value off a new build flat .
Developers where giving gifited deposits to landlords ,only for the landlord to discover the real value was the price they had paid .
As for a studio ,who will buy it off you when you want to sell ,only another landlord will buy it .

Conrad

One of my previous B2Ls was a studio and was AN EXCELLENT INVESTMENT. Here in the real world, it's quite useful to own the keys to the first wrung on the ladder and as such a studio can be a particularly good investment in terms of low rental voids as rent demand is consistent - what else will the many not so well off tenants be able to rent?. One local millionaire investor only invests in studios, indeed he's just built a block of them and let the lot.

Mortgages are possible on these too - a decent independant mortgage ONLY broker should be able to help.

Studios sell just as well as other flats, again you will be offering the first wrung on the ladder and there will always be people in the market. Only caveat would be to perhaps be wary around high density new build areas where tenants have much choice which drives rents down / leads to voids.

shane42

Old_Git wrote: »

difficult to tell the real value off a new build flat .
Developers where giving gifited deposits to landlords ,only for the landlord to discover the real value was the price they had paid .
As for a studio ,who will buy it off you when you want to sell ,only another landlord will buy it .

the first property i bought to live in many years ago was a studio because its i could afford, i sold it 4 years later easily for a big profit

shane42

seven-day-weekend wrote: »

I personally don't think it is a very good investment with a studio.

please can you say why, is it because rents are low? or difficult to rent?
thanks

shane42

Conrad wrote: »

One of my previous B2Ls was a studio and was AN EXCELLENT INVESTMENT. Here in the real world, it's quite useful to own the keys to the first wrung on the ladder and as such a studio can be a particularly good investment in terms of low rental voids as rent demand is consistent - what else will the many not so well off tenants be able to rent?. One local millionaire investor only invests in studios, indeed he's just built a block of them and let the lot.

Mortgages are possible on these too - a decent independant mortgage ONLY broker should be able to help.

Studios sell just as well as other flats, again you will be offering the first wrung on the ladder and there will always be people in the market. Only caveat would be to perhaps be wary around high density new build areas where tenants have much choice which drives rents down / leads to voids.

thanks for the reply
so far the studio offers the highest % rental yield...

Conrad

Shane - I've been dealing with investors a long long time. Some swear by houses, others only invest in studios, and some only invest in 2 bed flats.

It's a bit like banks - 1 person will tell you Abbey are fabtastic, the next will say they're dire.

Or hollidays - I'd hate a cruise, but some love them.

Or cars - I'd never buy a Vauxhall vectra when a slightly older AUDI makes a much better overall proposition in temr sof residual value, safety, quality and reliability. Someone else would think thwe opposite.

Studios are a great investment as long as there is'nt an oversupply of them for your local tenant demand.

shane42

Thanks Conrad for your advice ..
shane

socrates

seven-day-weekend wrote: »

I personally don't think it is a very good investment with a studio.

Not true

LHA rates (Housing Benefit) are the same for a studio flat as they are for a one bedroom flat - so in certain areas of London that can amount to a decent sum of money.

I am not going to post loads of links to back this up as I cannot be bothered but its how the rules work on LHA