buy to let - how do you choose?

nat38

googler wrote: »

£125k could get you a 2-bed 2-storey house, as opposed to a flat, in the A1/rail corridor to the East of the city - a short commute in, and well-placed for travel down South.

I see, but I think we'd need something more central. Plus, 125k would actually be too much (110-115k max)

VJsmum

Yield is important, of course, but it does also come down to location, location, location

We rent a house to students. I went and did my homework around the estate agents, but particularly the letting agents in the area. It turns out there was a very narrow "grid" of streets which were easy to let houses in as they were close to the Uni. However, another consideration is size of rooms and number of bedrooms - it seems students llike houses with 5 or 6 bedrooms of decent size. Many ask for things like Wifi or flat screen TV too. (wasn't like that in my day - scraping mould off the walls, i was). The other fact is we would never, ever live in it ourselves

nat38

VJsmum wrote: »

Yield is important, of course, but it does also come down to location, location, location

thanks VJsmum
I guess that's what I was trying to get at in my original question
I understand that yield is important, but also that it depends on other factors, as you say, location etc etc

VJsmum wrote: »

We rent a house to students. I went and did my homework around the estate agents, but particularly the letting agents in the area. It turns out there was a very narrow "grid" of streets which were easy to let houses in as they were close to the Uni. However, another consideration is size of rooms and number of bedrooms - it seems students llike houses with 5 or 6 bedrooms of decent size. Many ask for things like Wifi or flat screen TV too. (wasn't like that in my day - scraping mould off the walls, i was). The other fact is we would never, ever live in it ourselves

someone else said that a good LTB property is usually one where you would not live in...
I guess that our situation is particular in the sense that we are not buying strictly to let, but to use it part-time first and then rent it. so we need/want to like the place at least a little bit. Still, considering that it should be rented at some point, I was trying to think how to choose between those that we do like....
(hope this makes sense!)

Thrugelmir

VJsmum wrote: »

Yield is important, of course, but it does also come down to location, location, location

A rental property does not have to meet the same criteria as a home. Why pay a premium for a property you aren't going to live in.

nat38

Thrugelmir wrote: »

A rental property does not have to meet the same criteria as a home. Why pay a premium for a property you aren't going to live in.

but surely a better location means higher rent? or at least it will make it easier to rent?

GDB2222

nat38 wrote: »

but surely a better location means higher rent? or at least it will make it easier to rent?

Just as an example, you may prefer a nice, quiet location, near a park. For BTL, a less nice location but with good transport links will probably be far easier to let. So, it depends what you mean by 'better location'.

VJsmum

Thrugelmir wrote: »

A rental property does not have to meet the same criteria as a home. Why pay a premium for a property you aren't going to live in.

Because there may be a better letting market in that area. As i said our BTL is to students. Within the particular grid of streets the prices are inflated but you are (almost) guaranteed to let it, particularly if you keep it, relatively smart. These particular roads are full of students and competition for lettings is high. It was worth paying the extra few thousand to guarantee the let.

nollag2006

nat38 wrote: »

but surely a better location means higher rent? or at least it will make it easier to rent?

How do you define better location?

As others have pointed out, you need to view the world from the renters viewpoint. While a nice location might be settled and suburban, the rents are likely to be lower than something near a hospital or a factory, say.

As for yield, I have three BTLs and they all offer rental yield of between 6 and 8%. You would be lucky to get something with a yield much above that.

My portfolio is in London though, so that might make a difference.

junglejim2

I agree with nollag2006 on realistic gross yields.
Point me in the direction of a 10% yield and I will be there in a flash.

nollag2006

junglejim2 wrote: »

I agree with nollag2006 on realistic gross yields.
Point me in the direction of a 10% yield and I will be there in a flash.

You could try Moldova:
http://www.globalpropertyguide.com/Europe/United-Kingdom/rent-yields

:rotfl: