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cavester
Posts: 6 Forumite
Hi Guy's
Hope someone can give some helpful advice as to whether my idea sounds reasonable.
I am currently looking to invest in a cheap property near to where I live (about a mile). The property in question is a 2 bedroom single story terrace in the centre of the city within walking distance of a university, hospital and good transport links etc. The cost of the property is £55k but is in need of a good refurb which I would have about £10k set asside for.
My question is this... if I buy, do it up and rent it out (students, nurses etc.) then house prices drop, would this still sound to be a good long term investment bearing in mind the tenants would in fact be paying the mortgage?
If on the other hand I buy and do it up and house prices continue to rise, hopefully I get a around £80-90K which others in the street cost at the moment.
Please let me know you wise thoughts.
Cheers, :beer:
Lee.
Hope someone can give some helpful advice as to whether my idea sounds reasonable.
I am currently looking to invest in a cheap property near to where I live (about a mile). The property in question is a 2 bedroom single story terrace in the centre of the city within walking distance of a university, hospital and good transport links etc. The cost of the property is £55k but is in need of a good refurb which I would have about £10k set asside for.
My question is this... if I buy, do it up and rent it out (students, nurses etc.) then house prices drop, would this still sound to be a good long term investment bearing in mind the tenants would in fact be paying the mortgage?
If on the other hand I buy and do it up and house prices continue to rise, hopefully I get a around £80-90K which others in the street cost at the moment.
Please let me know you wise thoughts.
Cheers, :beer:
Lee.
0
Comments
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Could go either way, only you can decide at the end of the day. how much rent will the house generate? if it will cover the rent and more, maintenance,voids etc. go for it. i would.0
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Seems a bit odd to buy an asset if you think it's going to fall in value.
Bear in mind with your calcs that if prices do fall you may not be able to remortgage on it to take advantage of fixed rates/better rates.
If you can make £80-90k on doing it up, I'd do that. That's about 3 years average income!0 -
Well what I am thinking is that whether I think house prices will rise or fall is not really of concern as long as the tenants pay the rent. Yes if they continue to rise after a refurb then quids in but if not and they go down the tenants still pay the mortgage meaning after 15 years (mortgage term) I get a free house to sell (whatever the value may be) hopefully by 15 years if they do go down soon they will have gone back up even higher by then.
The basis of my calcs is that if I have 2 students each paying £60pw (minimum) thats £480pm total. Mortgage would be about £400 so £80 can go into a savings account for any future repaires etc.
Does this sound feasable? I just want to make sure i am not missing anything here.
Thanks,
Lee.0
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