Renting out my first property

swarby_2

yes, whats your point?

lazygoose

swarby wrote: »

the property i am buying is on a council estate so it would be rather hypocritical if they wouldn't let me rent it out to social tenants!! lol


does anyone have any experience of these council run schemes?

r u buying from the council? right 2 buy.

swarby_2

no, buying privately, think the person before me bought it off the council

---lee---

Give the guy a break - it's his first post!

Swarby, welcome to MSE - if you've not been put off posting, there's always plenty of people looking for plumbing advice in the DIY forum.

zzzLazyDaisy

remember that any rent you receive is taxable at your highest rate. So if you are working and already paying tax, there is a possibility that the rent could push you into the 40% bracket - ie you will lose almost half the rent to the taxman.

Even if you are a basic rate taxpayer, it is still a big chunk to lose, then there is maintenance, compulsory annual gas service, etc etc. What I am saying is, don't assume that whatever the council agrees to pay you for the house will all end up available to pay the mortage (although the whole of the interest is tax deductible, which is why most BTL mortgages are interest only).

meanmachine_2

swarby wrote: »

yes, whats your point?

OK, look at it this way: you're subsiding your tenant to the tune of £150pcm.

Actually it's more like £250 with voids and other costs.

Your property meanwhile is losing value - say, by £25,000 a year. Could happen - probably because interest rates have gone up.

SO IRs have gone up, your own mortgage costs have gone up, and now you're subsiding your tenant to the tune of £350pcm.

Worst case scenario. But don't let the goldilocks period of the last ten years blind you to the massive risks that property can bring.

Just plan for the good times and the bad.

cambsman

swarby wrote: »

I am in the process of buying my first place, now i hope this doesn't seem like a silly question but once i have bought it and done it up could i give it to the council on one of the 3 year guaranteed rent schemes and just go and but another place? i doubt the rent would cover the mortgage but would only be a couple of hundred short a month which i could afford to make up alongside a new mortgage, this just seems a bit easy and i fear i must be missing something as otherwise surely everyone would be doing this!!!

Wow, youve got some balls! Still, i guess its risk takers like yourself who are the entreprenuers among us that drive the economy, so good luck in whatever you decide to do.

Personally, im in a better position than most re:deposit and im still wary of buying a house for myself, let alone one to let out. Who knows though. In 20 years you could be sitting pretty on a bunch of properties while im still ooing and ahhing.