Overpay main mortgage or get a BTL?

Billy182

Hello,

Apologies if the question sounds dumb. Here is my situation:
I currently have a mortgage on my property, with around 50% equity and a 2.99% rate.
I have some spare cash, enough for a 25% deposit for a BTL.
Now I can't seem to be able to do the math...
Is it better for me to keep overpaying my current mortgage in the hope to become mortgage free as early as possible, or is it financially more beneficial to get a BTL and let the property? (on a 5, 10 or 15 years timescale)
Thank you

dimbo61

Being Mortgage Free is a dream for many. While many like myself have been overpaying for years.
What are your aims in life ? Do you have a works pension ? Good Income? Savings spread across stocks and shares ( post office ) , bonds, ISA,s
Do you want to become a Landlord ? Have you been a landlord before ?
Have you got a business plan

Billy182

Hi Dimbo,

I'm still pretty young but due to health reason I know I won't be able to pursue my current career for decades.
So becoming a landlord, doing house flipping is something I'd like to do at some point. I have a good income (eventually I can save enough for a 25% deposit in a BTL every single year), a little bit of stocks (15K).
So far my savings went into my mortgage in order to reduce the interest paid. But I'm at that point where I cannot overpay without charges anymore.
So as you can probably see I don't really have a plan at the moment but I'm trying to gather information and come up with something good
I appreciate your help,

Yorkie1

It's not entirely clear from your post, but it looks as though you don't have a good pension set up? If your present career isn't a lifetime career for health reasons (and I'm making some assumptions here), it does sound important to have a pension or other retirement income set up.

The drawback with your suggestion is that it means that all your eggs will be in 1 basket - i.e. property - if you rely solely on BTL.

Landlording is not an easy business to be in and shouldn't be undertaken lightly. The days of quick profit are long gone.

Thrugelmir

As others have mentioned earlier. What's your pension provision. Far more tax effective than a BTL business.

dimbo61

" House flipping " unless you are in the building trade or have lots of family in the building trades is only for the rich in London.
House prices in the rest of the country means you need to sit on a property for 5/10 years.
As a long term investment you can buy a property and rent it out but consider it very long term and you need to put the work in!
Letting agents cost money ( Most of your profit), looking after your tenants means "on call" 24/7 just in case or again having the right person to look after the place