Buy-to-let investments

ACG

It can vary massively.

If you use a letting agents then your looking at around 12% management fees - some will charge more, some less.
You will still have to do various bits of upkeep to the property but these may be included in the fees. I never used a lettings agency so i cant comment too much on that side.

I self managed, so you have the annual gas safety checks, any upkeep, tenents references (although i passed these on to the tenent). You also have to leave their deposit in with one of the deposit safety schemes, i forget their fees now but its not a lot.
Any empty periods.
An accountant - to keep on top of expenses income and ensure your paying the correct tax and ni.
costs of finding a tenent, some letting agencies charge a fee - which can be 1 months rent. When i did it i found a company who charged £200 + VAT.

OH and being on call for daft tenents. I had a tenant who locked himself out after 2 weeks....fair enough new home, it happens. 1 month later he did the same again, i was passing so i dropped it off. 3rd time, he locked himself out in his PJ's...i told him he would have to come and collect a key as its sunday, im hungover and im not leaving the house....he never did it again, trapsing 20 minutes down a main road in PJ's.

Also another person who left and there was an iron mark in the carpet...he said it was there when he moved in and only backed down when we shown him the invoice that had shown it was fitted the day before he moved in.

And we had another tenant who left having drilled a 5inch hole in the wall to allow ventilation for a canabis farm she had in the basement.

Its not all plain sailing, i only had 1 property (in a nice area!) and a full time job, it was hard work which is why i got rid of it. I think if i had the money i would do it again though.

Thrugelmir

WickyWickyWa wrote: »

Profit - very roughly

As others have said. Rent less interest does not equal profit.

You are treating BTL as an investment whereas it is a business. With all the risks and rewards that go with it.

Suggest you seek professional advice and guidance. As possible that buying for cash and holding the property(ies) within a limited Company structure could be beneficial.

Whilst initially you obtain your desired level of income. Growth of income is very dependent on the general state of the UK economy. So potentially may lag.

May be either buying an entire block of flats or a property that could be converted in an HMO would provide a better return. Than a multitude of single properties. As you could maintain the value of your investment by maintaining the property to your desire level. Thereby maximising income. Buying single flats leaves you at the whim of poor management companies, and the expense of unbudgeted communal repairs.

Mrs_Z

Just to add a few items to add to your calculations....

property buying costs (surveys and solicitors, etc), service charges (if buying flats), repairs and maintenance between and during tenancies, letting agent fees, landlord's gas safety certificates, annual boiler checks, EPC, bills during voids, mortgage payments during voids, insurances, provision for bad debts, your time, lost interest that you'd oterwise be earning on your investment....

How does the profit margin look now?

WickyWickyWa

Again - thanks for all the responses. I'll try to answer some of your questions:
Phoenixring21 - Initially thinking of trying to avoid letting agents as I want to keep as much of the money for myself as I can. I have however, though that if I have to get a "proper" job to suppliment my income, a letting agent would probably be a good idea.
My figures were from an afternoons searching on rightmove in various areas. Off course I plan on doing a lot more research before committing to anything.
RenovationMan - Not at all sure there will be enough income to replace my current income. That's why I asked for advice lol. I have been thinking on this a little over the weekend and if I do it and gives a decent income, I may be able to suppliment the income in other ways (e.g. part-time work, delivery work, etc). Gas and electricity have to be checked yearly (cost is about £50 each year). One of my thoughts was getting qualified to do the electricity checks - I could then not only check my own, but it could be another source of income.
Full letting agent service seems to be 15% of rent.
A certain amount of upkeep is tax-deductable (a percentage of the property value per year - cant remember the exact figure of the top of my head)
Empty periods - other sites advised to account for 2 months a year.
I am not sure I would need an accountant - I am confident I could keep my own books.
Thrugelmir - Not intending to treat as investment - intending to treat as business/job. Do you know of anywhere to seek the professional advice/guidance? I like the idea of buying a block - not sure if there is any easy way to search for that though.
Mrs Z - Profit margin still looks pretty good. Whats EPC?