Buy to Rent Advise Please!!

pappadruid

Hi

I am considering buying a flat to rent. I was wondering if any intrepid moneysavers had any pearls of wisdom to offer as to the best way to go about it, things to avoid etc. All advise is greatly appreciated!!

I currently own my own home and would be looking to use this as security for the second property.

Many thanks!!

Tassotti

No offence, but I think you need to do a whole lot of research before you buy a second property.

Don't use you home as security for the second property (in fact I am not sure if you can!)

First of all, check out local house prices, then rental prices. See if the figures stack up.

You will need a BTL mortgage, so you will need 15% deposit to put down. BTL mortgages typically need the rent to be 125-130% of the interest payments.

You need to speak to a good independent broker to discuss the best deal for you.

Once yoy decide if it is worth doing, then there is a whole lot more research to do after that (ASTs, letting agents, insurance, etc, etc)

Tass

F_T_Buyer

I think you're a little late for capital gains. So to make money, you will need to find a high yielding property. Aim for 7.5% to 8% minimum, i.e. aim to receive 8% of the purchase price as yearly rent.