Buy to let - some beginner questions and advice needed

poppysarah

Burnley!
http://www.rightmove.co.uk/property-for-sale/Burnley.html?sortByPriceDescending=false&sortByRelevance=false

Loads of properties for auction from £10k.

DarrenRS

Gleeful wrote: »

Burnley is an absolute shithole. Unemployment is really high, so it's likely any tenants you have will be on benefits. Don't touch with a bargepole! There's a reason why the property is only 30k

You could say that about Luton in the south as well though, but people do still live there and Luton is a lot more expensive than Burnley.

DarrenRS

poppysarah wrote: »

Burnley!

Loads of properties for auction from £10k.

They will probably sell for more than 10k at auction though and then require another 5 or 10k to 'modernise'.

Mrs_Z

I think your plan has a 'disaster' written all over it. You need to do some serious research into the subject, which I guess you have made a start by asking the questions. Still, I don't get it how you think you will be able to run a BTL without having ANY back up money what so ever. Your calculations are based on the best case scenarios - what about the worst case scenarios?

How will you manage when the property is empty betwen lettings (average 2 months per year), you need to pay the utilities in the meantime and what's your budget for repairs?, how about Letting Agent fees? Or will you manage th property yourself? (difficult if you buy in a different part of the country), what about if you need to go through an eviction process because your tenants won't/can't pay their rent? This can take months and cost you £££s. These are just a few basic things to think about. It's not just looking at a purchase price and how much rent you'll get. And if you buy somewhere that's cheap, there's a reason for it, usually because the area is no good. You will not get the ideal 'working professional' types tenants there who pay their rent on time. Why? Because they work and can afford to chose where they live, ie. to rent somewhere decent.

In your shoes I'd use the £120k to buy myself a house - enough there for a decent deposit, get a job and rent out a spare room (tax free up to a point). Far less hassle and you'll get some return for your money for not doing very much. No complicated tenancies, etc.

DarrenRS

Mrs_Z wrote: »

In your shoes I'd use the £120k to buy myself a house - enough there for a decent deposit, get a job and rent out a spare room (tax free up to a point). Far less hassle and you'll get some return for your money for not doing very much. No complicated tenancies, etc.

I had thought about doing that as well, apart from the 'get a job' bit which would be nearly impossible in the current job market. I do already have a job, just not sure how much longer for.

If I had a job then I wouldn't need to rent out anything. Just trying to plan ahead for if/when I don't have a job.

Gleeful

poppysarah wrote: »

Does Burnley have additional landlord registration requirements?

The poorest areas of Manchester (Lightbowne for one) have additional cost implications for landlords.

Just because they're poor doesn't mean they won't expect decent homes.

No need to be sarcastic. All I was saying was that someone looking for an 'easy' BTL should avoid places like that.

GDB2222

DarrenRS wrote: »

They will probably sell for more than 10k at auction though and then require another 5 or 10k to 'modernise'.

I suspect that the 5-10k modernisation figure is on the low side, but maybe you could get one completed for 30k. If you are going to have handful of 'difficult' BTLs in Burnley, then that solves your problem of deciding where to move to, because you will have to be on the spot to manage them. I suggest starting with one and seeing how that goes before buying any more.

GDB2222

This property is what is truly frightening about BTL in Burnley. http://www.rightmove.co.uk/property-for-sale/property-35440055.html

It's described as newly refurbished, but have a look at the photo - with steel shutters over the door and windows to keep the vandals out. It's pretty much impossible to let with the steel shutters on, but as soon as you remove them it will be broken into. Plus the steel shutters are expensive to rent each week and you have to pay empty rates on the property. This was somebody's failed refurbishment project - asking price £35k, done up!

DarrenRS

So tell me where is the best location to do BTL on a budget of 100k - 120k?

somethingcorporate

You could get a hassle free 5k with sensible investing or buy yourself a place and rent out a room or 2 for the extra income. BTL for your only source of income really has got disaster written all over it.