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Buy to Let possible?
Options
chris163
Posts: 51 Forumite
Hi
I have been chewing over what to do property wise for a while now and may have come up with an option but dunno if its possible.
I was thinking of buying a property as a buy to let?
A friend of my fathers is looking to sell his flat very quickly to raise some cash.
Its a 3 bed flat with garage for £165k on a 70 year lease. This is very good value in the area.
We can get a rental income of £700-750p.c.m. and we believe a mortgage valuation of £175,000.
How much deposit would i realisitically have to raise in order to do this as a buy to let?
Also, in terms of how they do it - do they look at your credit rating and job status? someone told me it is done purely on deposit and rental income?
I am in full time employment with a good credit rating earning around £35-40k a year (basic of £23k). I have a car loan which I can clear if necessary.
Any advice greatly appreciated as I have to act soon on this one!
I have been chewing over what to do property wise for a while now and may have come up with an option but dunno if its possible.
I was thinking of buying a property as a buy to let?
A friend of my fathers is looking to sell his flat very quickly to raise some cash.
Its a 3 bed flat with garage for £165k on a 70 year lease. This is very good value in the area.
We can get a rental income of £700-750p.c.m. and we believe a mortgage valuation of £175,000.
How much deposit would i realisitically have to raise in order to do this as a buy to let?
Also, in terms of how they do it - do they look at your credit rating and job status? someone told me it is done purely on deposit and rental income?
I am in full time employment with a good credit rating earning around £35-40k a year (basic of £23k). I have a car loan which I can clear if necessary.
Any advice greatly appreciated as I have to act soon on this one!
0
Comments
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not a very good proposition. The rental yield will be around 4.8% gross.someone told me it is done purely on deposit and rental income?
Typically, 15% deposit minimum and rent has to cover mortgage. With such a low rental yield, that is unlikely.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
similar flats are going for around £180-190k at the moment and my valuation was being conservative.
My other option would be to live in it and rent out a room or possibly 2 rooms. Being a first time buyer, I dont know if this would be better? the problem is, I cannot raise my deposit for 3-4 months as it is in a fixed account. I can however raise about £25k-35k.
My main priority is just to get on the property ladder as the prices in our area are just going mad...0 -
The higher the value, the worse the rental yield. Your money on the savings account would be earning you more as far as the rental income is concerned.
Its a case of how you think property values are going to rise or not.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
If you do want to buy it I think buying it for yourself, as residential rather than BTL would be the easier option.
As BTL with the modest return you would be struggling to get more than about £130k. As residential you might get close to £148k.I am a Mortgage Adviser
You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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