Help with mortgage advice please

hogwarts

Hello, my current mortgage will finish in 2012 and I may have the opportunity to purchase my late mother's house. It has been valued at £60,000.00 and I have two sisters who are entitled to equal shares. With their agreement I could give each of them their rightful share and I was wondring if anyone could advise me of the best way to borrow the money.
My wife and I work full time, she is 50 and I am 53.
Thanks and I look forward to hearing from anyone who can offer advice

Regards

Adrian

getmore4less

Why are you buying it?

hogwarts

I'm thinking of buying it as an investment and to rent out.

Adrian

getmore4less

Whats the projected rent.

Any other costs, refurb, funishing to rent.

Existing furniture may not meet fire regulation

Do you understand the costs and regulations of a landlord?

hogwarts

Thanks for the replies.
The house will need refurbished slightly, but I work in the construction industry and I can do the necessary work myself. The electrical and heating I would use competent people . I haven't considered my obligations as a landlord and perhaps I should look into this before jumping in. Looking at similar sized propereties in similar areas the rent is approx. £400/pcm. Also, I hadn't thought about the furniture and fire regulations. I'm glad that I posted this message as you have given me food for thought in areas that I hadn't given thought to.
Regards
Adrian

getmore4less

£400pm on £60k is a gross yield of 8% which look on the ok side, 10%+ would be better but hard these days.

This will reduce with the costs to get into a rentable state(which will probably give you a higher potential exit price.

Whats the build cost against potential sale cost that will give a new potential gross yield( a measure of keep or sell).

Running costs will reduce this further a BTL mortgage for £40k will be heading towards 5% so not much room for a margin

If after looking at renal business there may still be room for a DIY project.
quick turnaround and sale might be atractive to the others without having to borrow.

hogwarts

Thanks for your advice. I didn't realy expect to make much on the rent, but I thought that it was too good an opportunity to miss. I'll probably never again be in a position where I can buy a house for £40,000. I was thinking that if the rent could pay the mortgage until house prices have risen and possibly I could make a profit by selling some time in the future, if I need to.

Regards

Adrian