Spare 35k Buy to let maybe??

Catbells

If I get the house I'm putting an offer in on today I will have around £30k left over. I was wondering what to do with it. Its part of a retirement pension scheme which I won't need for around 6 years. I thought I could maybe buy a small flat to rent out. I know a 25% deposit is required. Is this for all borrowers? Is it a good idea to btl at the moment? I wouldn't want to buy in London so lastly is it viable to btl in an other area some distance from where I will be living. Would I get a mortgage or could I get the renter to pay the mortgage. Never done this before so completely green about it. Thanks for any ideas or personal experiences.

heretolearn_2

You would need to get a mortgage and pay it. The idea is to find a property where the rent is more than the mortgage/other costs, at a level that makes it worth while. Not easy to do these days, you need to do a lot of research into the rental market in the area you are looking at.

theGrinch

can you see yourself as a landlord, with calls at any time? Even if you use a letting agent, you will still get calls. why not just place them in some high yield blue chips and take it easy?

mjdh1957

I'd say 6 years is too short a term to consider something like BTL, which might not give you any capital returns for ten years or more.

theartfullodger

bullau wrote: »

You tried finding a mortgage for a BTL flat with 25% deposit? Fortunately for you the banks are not as stupid as you are.

Err.. not true,, those sharks @ "The Money Centre" currently list 2 BTL mortgages @ 75%[5.4, 5.95%] & even 2 @ 80%..[4.99%, 5.49%] - yes I know those %ages look the wrong way round - you have to look at fixed term period, fees etc etc..

However, only become a landlord if you have the emotional & financial reserves to cope with the "tenant from hell" who you can't get out for 7 months whilst you keep paying the mortgage, and the legal bills, who then phones up asking you to fix something & you have to do it or possession order judge will decide you've been harassing him...

Also, interest rates are currently at an all time low (0.5%): I remember paying off a mortgage when Bank of England base rate was 17% (!) within a year of Thatcher grabbing power.... Do your sums on that basis & then see what you can afford...

Cheers!

Artful

GDB2222

bullau wrote: »

Fortunately for you the banks are not as stupid as you are.

You seem to be having a bad time at the moment. We all feel sorry for you, so try not to take it out on other users of these forums.

GDB2222

I don't want to psychoanalyse you, but you made two hurtful comments to other users this morning. The most likely explanation is that you are hurting inside in some way. I hope that whatever is troubling you clears up soon and you are able to resolve your personal issues.

mynameisdave

bullau wrote: »

a very odd and incorrect assumption to make.

the guy has saved money on a purchase because prices have fallen.

And where does he say this? He could be buying a smaller property because of a relationship ending, or the kids moving out and a large house not needed (entirely possible given he is 6 years away from needing his pension)

That he has 30K spare makes no reference to his original purchase price, sale price, asking price of new place or sale price of new place.

To accuse other people of assumptions is a little pot kettle IMO.

theartfullodger

bullau wrote: »

is the money centre a bank?

http://www.themoneycentre.net/

They are a bunch of self - important loan-brokers who's fees ain't cheap. I'm not recommending them, simply using them as an example...

Cheers!

Artful

mynameisdave

bullau wrote: »

He states
"If I get the house I'm putting an offer in on today I will have around £30k left over."

£30k left over means left over from the money he had available to purchase with.

I never said it was £30k off the place he is buying.

I have no interest in why he is buying it, his personal situation is irrelevant to the figures.

I did not make any assumptions, certainly not personal ones like the arm chair psychologist above.

If you have nothing of relevance to add then why bother typing?

Yes, he has 30K left over after he is buying. This 30k could come from any possible combination of scenarios. However YOU decided in your original reply that he has saved the money because it was a falling market. You have no idea when the OP bought, you have no idea what he is buying, you have no idea what he is selling.

How do you know the potential house is lower than at peak?

You didn't make any personal assumptions? Nah, you're right, just outright abuse.

Nothing to add? Well why don't you actually give him proper advice on the potential pitfalls of being a LL, such as voids when nobody is in the flat, unpaid rent, gas checks and calls to fix a leaky tap. Cost of paying somebody to go round and fix it along with management fees for paying an agent if it is a long way from where you live?

That would be more fun and you can save your posts calling people stupid for the house prices board where you can argue to your hearts content with people that dont want to contribute anything worthwhile until they have peddled their own agenda till they are blue in the face, ok?

sinbad182

Bullau is having a nightmare in here!