Buy To let mortgage help please!

hearts

btloptingout wrote: »

Check this out:
http://en.wikipedia.org/wiki/Yield

Wikipedia is great....I also though this appropriate on reading your post.
http://en.wikipedia.org/wiki/Terry_Fuckwitt

I miss your point dafty ;-) Does the first one not confirm what I say.?
And therefore does the second one not more describe yourself? ;-)

sikejsudjek

OK you want advice ? Don't do it. Pay off some of your debt, save some money at the bank. Why ? Because yields are lower from BTL at present than a savings account !

But wait - isn't everyone getting into BTL ? Yep - because they have no clue about market timing. 40% of BTL has been bought in the last 3-4 years, after 300% house price rises. Meanwhile wages aren't keeping up with inflation, interest rates are going up, and there is a glut of rental property. Which suggests what ? CRASH !!!!!!!!!!!!!!!!!!!!!!!!!!!

The smart money is getting OUT of BTL, not into it. When the music stops, don't get caught with a large pile of debt.

mr.broderick

sikejsudjek wrote: »

OK you want advice ? Don't do it. Pay off some of your debt, save some money at the bank. Why ? Because yields are lower from BTL at present than a savings account !

But wait - isn't everyone getting into BTL ? Yep - because they have no clue about market timing. 40% of BTL has been bought in the last 3-4 years, after 300% house price rises. Meanwhile wages aren't keeping up with inflation, interest rates are going up, and there is a glut of rental property. Which suggests what ? CRASH !!!!!!!!!!!!!!!!!!!!!!!!!!!

The smart money is getting OUT of BTL, not into it. When the music stops, don't get caught with a large pile of debt.

when the music stops...

A chap on here had this as his signature, he was a legend...He'll be back...

grey_lady

You lot are rotten.
Do the sums carefully and decide for yourself, ignore 'tipsters' on bulletin boards.

mr.broderick

grey_lady wrote: »

You lot are rotten.
Do the sums carefully and decide for yourself, ignore 'tipsters' on bulletin boards.

snootchie bootchies..this is a sign..

hoglet

Why it's too late to jump on the buy-to-let bandwagon:

http://money.uk.msn.com/Mortgages/BuyToLet/article.aspx?cp-documentid=5120518

Interesting reading.

Hoglet.

Generali

hearts wrote: »

I miss your point dafty ;-) Does the first one not confirm what I say.?

I think this is quite a common mistake. Yield is measured WRT the current market price, not the price paid.

For example:

You buy a flat in Elephant and Castle for £100k and rent it out at £800pcm.
Yield = annual income/market value = £9,600/100,000 = 9.6%.

The government announces a clampdown on 'horrid people being horrid in horrid bits of South London'. For once it manages to carry out it's policy quickly and efficiently (in a happy accident, Patricia Hewtt is horribly humiliated at the launch and retires from politics). House prices and rents soar in South London.

You can now sell your flat for £300k. Rents have gone up to £1,600 pcm.
Yield = annual income/market value = £19,200/£300,000 = 6.4%.

The idea of measuring yield against current market price rather than price paid is to make it easier to measure investments against each other. If flats in Brixton were yielding 10% in the 2nd time period above, you might decide to sell your investment in E&C and buy in SW2 instead.

hearts

Generali wrote: »

I think this is quite a common mistake. Yield is measured WRT the current market price, not the price paid.

For example:

You buy a flat in Elephant and Castle for £100k and rent it out at £800pcm.
Yield = annual income/market value = £9,600/100,000 = 9.6%.

The government announces a clampdown on 'horrid people being horrid in horrid bits of South London'. For once it manages to carry out it's policy quickly and efficiently (in a happy accident, Patricia Hewtt is horribly humiliated at the launch and retires from politics). House prices and rents soar in South London.

You can now sell your flat for £300k. Rents have gone up to £1,600 pcm.
Yield = annual income/market value = £19,200/£300,000 = 6.4%.

The idea of measuring yield against current market price rather than price paid is to make it easier to measure investments against each other. If flats in Brixton were yielding 10% in the 2nd time period above, you might decide to sell your investment in E&C and buy in SW2 instead.

Thank you I stand corrected, that seems to make sense ;-)
Although I still don't understand how this would work in a falling market. Asuming everything the same but value drops to 90k?

Generali

hearts wrote: »

Thank you I stand corrected, that seems to make sense ;-)
Although I still don't understand how this would work in a falling market.

As the price of the asset falls, if the income stays the same, the yield rises.

Off to some da.mn BBQ but will try to post later about yields.

PS Went to St John Restaurant on St John Street last night. Best meal I've had in a very long time. Not cheap but very, very good. My mate had pigs ear with dandelion, delicious!

Melissa177

Hang on Generali, you're going to a BBQ on a sunny day, and you're complaining?

I've bought bread from St John's in Spitalfields - their sourdough bread is delicious.