Double your money in 5 years?

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  • benoodbenood Forumite
    1.4K Posts
    Of course if the property falls 10% you lose your equity stake just like investing in the stock market. But as property only ever goes up you're quids in.:rolleyes:
  • Ian_WIan_W Forumite
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    Part of the Furniture 1,000 Posts Photogenic
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    EdInvestor wrote:
    And of course someone else (the tenant) pays the cost of servicing the loan.
    If you're lucky Ed! :eek:

    This is on sale near a local hospital where you'd expect good rental potential
    www.rightmove.co.uk/viewdetails-15568145.rsp?pa_n=1&tr_t=buy
    90% = £105,300, which on a BTL IO mortgage @6% would mean repayments of £526.50 pcm. Based on 11 months occupancy you'd be out of pocket with the most expensive one on RM for rental:
    www.rightmove.co.uk/viewdetails-15403819.rsp?pa_n=2&tr_t=rent
    Even with no voids the next most expensive, and probably more realistically priced for the area, would see you several £100 out of pocket over the year - just on the mortgage repayments.
    www.rightmove.co.uk/viewdetails-8140578.rsp?pa_n=3&tr_t=rent

    Then of course you've all the associated costs like agents fees, gas certs, repairs, insurance and on the capital side [where you'd be looking to double your money] there are significant buying and selling costs to cover and CGT etc before you turn a profit.

    Now I realise you don't consider costs important when it come to investments ;) but in many areas BTL purchasing doesn't make much sense at the mo unless you're really looking very long term and are prepared to subsidise the tenant at least for the foreseeable future.
  • dunstonhdunstonh Forumite
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    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
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    but in many areas BTL purchasing doesn't make much sense at the mo unless you're really looking very long term and are prepared to subsidise the tenant at least for the foreseeable future.

    or a builder or someone who can do enough DIY to turn a cheaper, low quality property into something a bit more desirable at low cost.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • EdInvestorEdInvestor
    15.7K Posts
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    The query on this thread was how to double your money in five years.

    There are still plenty of properties around which will yield enough to cover costs, though not these days with much of an extra margin.

    But the target is very undemanding.To get 100% return on capital invested, you only require the property market to rise by 2% a year.
    Trying to keep it simple...;)
  • benoodbenood Forumite
    1.4K Posts
    If it's your own home then you have ppr relief as well so will avoid CGT at your marginal rate.
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