say you had 100 grand

jamels2

I was just thinking, if you had 100 grand sat in the bank, you'd probably be gaining 2000 a year in interest. however if you bought a small flat with that money you'd be able to rent it out for about 550 where i am and that is 6600 a year.

is it no wonder many people want a buy to let property instead of leaving the money in the bank? is there any other way to make a 5/6% return on 100k?

fizio

I'd say your 5/6% is mor elike 4/5% once you factor in things like agency fees/repairs/empty-periods etc and 4/5% is get-able by sticking it in the stock market without all the hassle of owning a BTL property..

marathonic

For someone looking for a hands-off investment, which is the only way to compare to a passive alternative investment, one would need a letting agent and accountant to file their returns. Here are some conservative figures for your proposed investment, for which finance isn't required (which would add interest to the expenses).

Flat Cost: 100,000

Rent: 6600
Letting Agent: 660
Void Allowance: 660
Accountant Fees: 200
Insurance: 180
Maintenance: 1000

Total Profit: 3900
Tax: 1560
Profit After Tax: 2340

Loss of 2% Interest on 100,000 investment: 2000

Total profit: 340

ChesterDog

The answer is yes, you can do it - and beat it - in other ways.

Shares/funds/investment trusts without taking too much of a risk and without the hassle.I have some money in 'the idea' (via The Housecrowd) but without the hassle. Getting 6% plus a share of the profit on eventual sale.