Pitfalls to going into rented

Penny_Farthing_2

Sorry if this is long-winded but can I have your thoughts on this situation. We want to move house and have a very good offer indeed from a good buyer who wants to proceed. We can't find anything to buy. Should we go into rented? Are there pitfalls we need to know about?
Thanks

abaxas

A few pitfalls.

1) Min period of AST is 6 months
2) Evil letting agents (make my blood boil!)

Apart from that none!

littlesaint

If the market crashes after you sell you'll be laughing. Though that seems very unlikely to happen.

inmypocketnottheirs

6 months rent 'down the drain'?

abaxas

inmypocketnottheirs wrote:

6 months rent 'down the drain'?

I'm sure if he shops around he'll not be throwing money away.

Remember that renting has always been a buyers market.

inmypocketnottheirs

abaxas wrote:

I'm sure if he shops around he'll not be throwing money away.

Remember that renting has always been a buyers market.

Depends if you would rather be paying your own mortgage or somebody elses!?!?!

SSShhhhhhhh, what's that noise......


Its the price crash brigade!!!!!!:rotfl: :rotfl: :rotfl: :rotfl:

abaxas

inmypocketnottheirs wrote:

Depends if you would rather be paying your own mortgage or somebody elses!?!?!

SSShhhhhhhh, what's that noise......


Its the price crash brigade!!!!!!:rotfl: :rotfl: :rotfl: :rotfl:

Nice helpful post!

Seriously though, he needs to do his homework. Also if he wants cheap rents he needs to find a nice new build bought by a BTLer.

Get the BTL to subsidise him for a while while he moves.
(read up on the 'is renting dead money' thread to understand)

Why should be pay for things when someone else is willing to pay for him?

lynzpower

I disagree with Abaxas.

If someone has recently bought a BTLer on a new build chances are they will have a massive mortgage to meet hence higher rents.

Personally, we have found some good prices in 90s style flats, low rise developments round courtyard flats, and they have been around 300pcm less than a new build thrown up over the last 12 months, probably as ythey were bought on a smaller mortgage.

F_T_Buyer

Won't the interest on the cash from your house sale contrinute towards the rent?

Also, several places do short term renting. There was an article on this in The Scotsman a while back.

sm9ai

You will have the "crash" brigade, and the "prices will only go up" brigade. Both trying to spout loads of irrelevant crap at you.

But basically work out the costs for yourself.

Rent will not be money down the drain as generally the rent will be lower than the interest only on a mortgage.

So with interest on the money from the sale. You should be paying less each month than you would on a mortgage.

But of course work out all the figures first.

So in the short term it makes sense and will give you the chance to find a perfect house. But in the long run prices could keep increasing and run away from you. Just make sure you don't blow the equity on a 4x4 or something stupid like that.

abaxas

lynzpower wrote:

I disagree with Abaxas.

If someone has recently bought a BTLer on a new build chances are they will have a massive mortgage to meet hence higher rents.

Personally, we have found some good prices in 90s style flats, low rise developments round courtyard flats, and they have been around 300pcm less than a new build thrown up over the last 12 months, probably as ythey were bought on a smaller mortgage.

A good idea too!

However there is nothing like a 4-6month initial void to polarize a new BTLer into action.

Here in sheffield you should be able to secure a 6 month AST on a nice 2 bed flat for <£450 a month in a reasonable area. £450-£500 PM for city centre or nice area. Approx flat costs 100-150k.

Remember that an unletted property is causing pain to the landlord. You can fix that.......