where would you buy to let??

peter1000

So where would you buy to let? or buy to renovate and sell?

I got 70k for deposit or go for very cheap?:D

theartfullodger

Not too close to where you live (at least a couple of miles away): Not miles away (I have 3 houses 10hours each-way drive away: Not recommended...)

Buy if it appears a good deal. Do not believe the vendors, the agents or the people selling courses /training on how to get-rich-quick from buy2let.

ognum

In an area you know well and understand. Know the demographic of the likely tenant, know how much different types of property lets for and if you can get a decent return.

Somewhere that traditionally has had good capital growth.

hostie

I would recommend Aberdeen. Anywhere within 10 mins walk to the University campus will be a good earner. Near Aberdeen University there is a council estate called Kittybrewster where house values are low and property yields are high (11%). If you rent to students, you can make more money as they tend to work out the price they can afford by 'room' so a three bedroom flat will get you 3 x 400 or at least £1000. Each additional double room will bring you another £400 on the rent. The only issue in Aberdeen is that you will need an HMO licence to rent to 3 or more unrelated people. This will cost you initially and in principle, I think it is a good thing. Unlike other cities, though, the Aberdeen HMO people tend to always come up with new things that you have to do to your property every three years, which is a pain (because you will have made it super safe the first year, so these added things are just to perpetuate their jobs in my opinion). If you want any more info, just PM me.
The problem as the OP mentions above is that you probably live 10 hours from Aberdeen. So you may wish to look at somewhere closer to you. Close to a university is always a good start.

hostie

Also, I would split your 70k and invest in two properties at least if you are going to do buy to let. They should bring you in a good income if you get places with a good rental value (the more bedrooms the better).
If you buy one place and keep it ten years, and it has gone up in value by 100k, you will have made 100k plus the rental value. If you buy ten and they each go up 100k, you will have made 1 million. It depends how much risk you are prepared to take, but I'd use your money as a deposit for two buy to let places. Buying to renovate and sell on pays for some people. But if you are a novice (which I guess you are) then I'd avoid that as it could go wrong and you would have lost your big opportunity.

Hoploz

Hostie makes some good points above.

I have done btl in two areas. In Surrey it is expensive to buy and therefore there is little if any monthly profit but a good deal of capital growth so it is a long term winner and short term loser.

I have another property in a seaside town which wins hands down on monthly profit, I am clearing a good couple of hundred a month on that one instead of losing money, but I know the capital growth will be slower. I am happy with this as it is an up and coming area showing great signs of business and tourism investment, so with these added green shoots I am confident values will rise and I am in for the long term do even without the up and coming bit prices tend to rise over time.

However, this one is 2 hours drive away so when the tenants say they have some stupid little problem I do get a bill from a tradesman (organised by letting agent on full management) instead of being able to pop round and show them myself how the bl00dy tap works.
(sorry, sore subject lol)

hostie

Hoploz, you would make more money if you managed the places yourself. British gas do a cheap home care package (I think I pay about £40 per month for their top landlord's package). If the tenants email you to say the tap / central heating / light isn't working, you just reply with the phone number for British gas and it is free for call outs (and minor tap repairs). The only thing you have to be super careful of if you are managing yourself, is that you have a suitably sound and legally robust tenancy agreement. I always pay the same solicitor to draw mine up each year. It costs me about £180 but is worth it. Squatters are the biggest headache a landlord can ever face in my opinion.

I'd like to add that while I see Aberdeen as a good prospect for buy to let for the next 10 years or so (because it is the oil capital of Europe and so rents are high, yet it is in the north of Scotland so property values especially in council estates are fairly low), I wouldn't recommend it as a long term prospect. When the oil runs out in 20 - 30 years, there will still be an oil industry in Aberdeen but I suspect it will be much smaller and there may be a house price crash. Properties near any university are a safe bet in most cities, but you do have to keep an eye on how much student accommodation the University nearby is building.

Pixie5740

Hostie do you actually know Aberdeen? It is not a cheap city to buy property in, far from it. The slump in oil price hadn't filtered through to the housing market. A friend of mine just sold a 1 bedroom flat valued at £115k for £135k within weeks of it going on the market last month.

The oil is not going to run out in 30 years either.

I don't know where your obsession with squatters comes from. Squatting is when someone deliberately enters property without permission and lives there, or intends to live there. This is sometimes known as ‘adverse possession’.

Anyone who originally enters a property with the permission of the landlord is not a squatter, eg if you’re renting a property and fall behind with rent payments you’re not squatting if you continue to live there.

hostie

Hello, I think there are still bargains to be had in Aberdeen especially in council estates since many people in the oil industry prefer fancier flats or three bed houses. The yields tend to be higher, since you can still get say a three bed flat for £120,000, whereas down south in places with similar rents to Aberdeen, you would need to pay much more.
My obsession with squatters comes from experience. Squatter may not be the technically correct term. I refer to people who for one reason or another refuse to move out of a property or seek to claim that property as their own. I think that most other issues can be easily dealt with by a landlord, but evictions can be lengthy and costly.

I agree that the oil might not run out in 30 years, but I do think that Aberdeen property prices are linked to the oil industry and that any problems in the oil industry (such as there were in the 80s) would cause property prices in the city to drop. So if OP is looking for reliable capital gain, their 75k would be better spent somewhere with more solid long term prospects. This is just my opinion, but I think this is the kind of answer Peter1000 was looking for.

Pixie5740

I'd love to know where you can find a 3 bedroom flat for £120k in Aberdeen. The ASPC website has one 3 bedroom flat in Dyce at offers over £125k and that's the closest I can find.

hostie

Just had a quick look and there is one with three bedrooms for £107,000
It is under offer.
https://www.aspc.co.uk/search/property/324915/5-Gardner-Crescent/Aberdeen/
I didn't say the OP would get a 3 bedroom flat for £120k any day of the week. Property investment involves a lot of boring leg work, such as watching the market every day. Yes there are reasonably priced properties in Aberdeen but they get snapped up. It took me a year for my first flat to appear on ASPC with the amount of bedrooms I wanted at a price I could afford. I put my offer in the day of the viewing, the day after it appeared on ASPC.
The one you saw in Dyce would also be a good prospect. I saw another one with 3 bedrooms in Dyce. Remember that Dyce is where a lot of the oil workers want to be based. I have a cousin that lets out rooms in Dyce and he gets a lot more money per room than you would get for students.
This one is also under offer, but I think it proves my point (to people based down south, looking for investments that will bring in over £1k per month in rent).
https://www.aspc.co.uk/search/property/324665/13-Garmaddie-Lane/Aberdeen/