Interesting idea regarding investing in property

Crown

findingmyownway wrote: »

sounds like a cracking way to get into debt, not out of it!

Yes it is. Since im having to sell my property under market value if it ever finally goes through at least £20k of my debts are due to this flat.

Also please dont think it wouldnt happen to you and Crown is obviously some type of plank. I did he home work and on paper it looked sound.

Yes I am a plank by trying to take a short cut on the road to debt elimination. If I hadnt done this I would be debt free next year :mad:

peb

Aaaargh No no no!

Mortgage Lenders have 1 big criteria which is frequently ignored by buyers, especiailly first time buyers just putting their foot on the property ladder. You must not have recourse to further borrow to fund the purchase - I know that many of my clients are, shall we say being evasive with teh truth when answering this question and I have had people state quite blatantly that they have got a loan for the deposit but that doesn't count! I have seen a lot of posters who have mentioned borrowing, maybe within family, for the deposit and it does really worry me. The Lender works out what they think you can afford to repay and they have their reasons - add on n extra £200 for a loan and there are problems. Sorry. Rant over.

PS you would never guess I am a property lawyer now would you?

ManAtHome

Kaz2904 wrote: »

Your post wasn't here when I posted! You have the points right.

LOL - I keep doing that - open up a few threads, then by the time I've replied we're on page 6...

thebillet

It strikes me that you would be doubling (at least) your risks; firstly by buying property in the hope that it increases in value while funding itself through rental income. Secondly the risk is further compunded by wanting to invest in overseas property. I am lucky enough to be the owner of a house abroad and while it has gone up in value, on paper, the chances of it selling quickly are in my opinion remote. I would endorse what has been said about tenants, they can be good they can be dreadful. I have even had recommended to me that I take a loan out against my own house in the Uk and invest in a country with 18% interest rates, the only problem with tha suggestion is I can't see into the future.

As indivduals we will all make our own minds up about what to do but i have enough to worry about getting simple things like DDs sorted out and stopping BT putting up my monthly DD by 230% and that is when both parties speak English.

Finally one very sad tale about some folks who "bought" an apartment near ours only to find out the partner to whom that had given the money was not the one whose name is on the title deed. The choices they face include buying it again from the other partner or suing the person they paid in the first place. if they do sue it will be abroad and not in english either.

Apart from that it should all be plain sailing. Ahem!

Archangel

Crown wrote: »

Hi, I actually did buy a BTL property hoping that I would I cash in if we got the olympics and after doing some research and attending a few courses and reading the books I brought the property.

What they dont show you on these TV shows were everyone is making money left right and centre is that Tenants can be complete pains in the !!!! and stop paying there rent. What do you do then? the Mortgage company are not interested and just want there monthy installment.

Since buying the flat I have had the worst 3 years of my life and am now in majot debt buy borrowing and consolidating, and buying again.

I know it works for some people and I do intend on getting back into the property market at some point but I will do it when I actually have a proper deposit and a Emergency fund when the tenants miss there payments.

Just to add before I brought the property I had small amounts of debt but reasonably good credit. I now have terrible credit High, Debts, and a Repossion Order on my flat.

My advice would be to stay clear.

But this idea was holiday letting, not renting per se. With holiday renting you would get the payment before they go to stay there, not afterwards.

I think you could've done that with your property in London as a lot of people go to stay in London for holidays, etc.

I think that's where you went wrong.

Also, having a agent do the hard work (for a cut) would be a better bet as they can do the chasing up in those instances. They can also handle the changeover, cleaning, etc.

Luke.

findingmyownway

Archangel wrote: »

Also, having a agent do the hard work (for a cut) would be a better bet as they can do the chasing up in those instances. They can also handle the changeover, cleaning, etc.

Luke.

for a very substantial fee i would assume!!

lynzpower

Archangel wrote: »

But this idea was holiday letting, not renting per se. With holiday renting you would get the payment before they go to stay there, not afterwards.

I think you could've done that with your property in London as a lot of people go to stay in London for holidays, etc.

I think that's where you went wrong.

Also, having a agent do the hard work (for a cut) would be a better bet as they can do the chasing up in those instances. They can also handle the changeover, cleaning, etc.

Luke.

And what happens when people dont want to rent your place?

Check out the voids in June alone here http://www.holiday-rentals.co.uk/europe/s/5/fa/find.squery/urvs/21 8163 villa owners have voild in June, what makes you think youd be any different? And thats only one website- there are hundreds.

lynzpower

I think you could've done that with your property in London as a lot of people go to stay in London for holidays, etc.

Yes they do indeed. But youd be competing with 5* hotels at 50 quid a night and travellodges at a tenner a night.

No offence mate but I tihnk you are living in a dream world.

Crown

Archangel wrote: »

But this idea was holiday letting, not renting per se. With holiday renting you would get the payment before they go to stay there, not afterwards.

I think you could've done that with your property in London as a lot of people go to stay in London for holidays, etc.

I think that's where you went wrong.

Also, having a agent do the hard work (for a cut) would be a better bet as they can do the chasing up in those instances. They can also handle the changeover, cleaning, etc.

Luke.

Hi again,

Just to follow up I did have a letting agent taking care of the property for a 8% a month fee what pretty standard in London. I also made sure that I had tenants in the property when I brought it. As I have already said some people do make money and I will get involved again at some point WHEN I am debt free.
4 Family friends also have been involved in the property investment shemes and 3 of them are having to sell or have incurred debts in the 3 years though have owned them.

The Property Ladder type programs have a lot to answer too as it isnt so straight forward. If you do decide to go ahead I wish you the best of luck. I can only offer you my own personal opinion and experiences.

Also if you brought a property to let out in the holiday season what will you do the rest of year with it? How are you going to be able to afford the upkeep as the agent will still need paying to keep an eye on the property and make sure it is kept clean and in working order?

Unless you have a big deposit or lump sum to invest you should really think hard.

lynzpower

does no one else have any pearls of wisdom here ? I hate to be the only voice of doom maybe im just being overly negative as usual? Am I?