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BTL Property
100saving
Posts: 314 Forumite
So these are the terms:
Studio in a nice part of London in very good condition.
£160,000
£250 Ground rent a year
No service charge (if anything needs doing it split with 4 properties)
Rental price PCM: £750-£850
Mortgage approved at 65% LTV.
Should I buy and follow through or pull out before spending too much money??
Studio in a nice part of London in very good condition.
£160,000
£250 Ground rent a year
No service charge (if anything needs doing it split with 4 properties)
Rental price PCM: £750-£850
Mortgage approved at 65% LTV.
Should I buy and follow through or pull out before spending too much money??
Age: 24 / London/Ireland / Salary €49,000 / 1 London BTL (8% yield) / Total savings pot £12k+
Lloyds Club CA £5,000 @4% / FD Regular Saver £3,600 @6% (12 of 12) / TSB Classic CA £2,000 @5%
Clydesdale Direct CA £1,000 @2% / Santander ISA £700 @0.5% / Premium Bonds - £100
Halifax Reward CA (£5 per month) / Santander 1|2|3 CC (cashback)
Lloyds Club CA £5,000 @4% / FD Regular Saver £3,600 @6% (12 of 12) / TSB Classic CA £2,000 @5%
Clydesdale Direct CA £1,000 @2% / Santander ISA £700 @0.5% / Premium Bonds - £100
Halifax Reward CA (£5 per month) / Santander 1|2|3 CC (cashback)
0
Comments
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Offer has been accepted at £158,000 should I proceed?Age: 24 / London/Ireland / Salary €49,000 / 1 London BTL (8% yield) / Total savings pot £12k+
Lloyds Club CA £5,000 @4% / FD Regular Saver £3,600 @6% (12 of 12) / TSB Classic CA £2,000 @5%
Clydesdale Direct CA £1,000 @2% / Santander ISA £700 @0.5% / Premium Bonds - £100
Halifax Reward CA (£5 per month) / Santander 1|2|3 CC (cashback)0 -
what mortgage rate have you got? what are the mortgage fees?0
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So using a few guesses I've got.
Invest £55k ish
Borrow £100k ish
Pay 4%ish interest
Income 12 * £800 = £9,600
So profit before tax about £9.5 - £4 - £0.25 = £5.25 ish
Profit after tax about £4.2
ROI about 7.6%
Not bad on the face of it but you also have to consider risks and other upsides.
Risks:
A few months of no rent, a big bill, nightmare tennants (read some of the stories on here). Can you cope with that? Do you want to be a their beck and call 24/7?
Upside:
Obvious potential for increase in property value.
It would be too much faff and risk for me but your choice.0 -
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Does it meet your lenders size or square metrage/footage min requirements?Studio in a nice part of London in very good conditionI am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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