Buy to Let Income under 25K

ACG

If house prices are rising faster than the national average that can overcome a poor return... although CGT may be applicable etc.

Personally I think its a bad idea as I would rather have a £300k risk spread out especially where the income is not enough income to support it should something go wrong.

nubbins

Leon_W wrote: »

Someone mentioned it earlier. If it's a BTL then why would somebody want such a poor return ? This is the sort of question any underwriter would be asking as it doesn't make much sense.


Returns would be greatly improved by buying say three smaller cheaper properties rather than one dirty great expensive one.

Its not necessarily a poor return, like ACG says IF that house is worth 425 - 450k in 2 years time then along with her £400 a month its better than most other investments. I would imagine that Surrey is similar to where I live in that even during 2008 - 2013 house prices didn't really drop massively (if at all) they just took longer to sell, if you are one of the HPC'ers then thats a take on things.

The fact that she already has a house worth 350 - 400k paid off makes this a pretty good way of doing things imo. The only negative is 14k per annum salary and possibly having to find £900 a month for the BTL mortgage.

ACG

I agree completely, but if you are looking at things from an income perspective there are many far better opportunities.

Its never going to the the standard BTL mortgage but if you are not looking to maximise your return on a monthly basis then its not a bad idea - but its important the OP/OP mum realises interest rates are at an all time low so the return will go down in years to come and that house price rises may be liable to CGT so the profit she thinks she will make from house price rises could have a huge bite taken out of it.

Thrugelmir

nubbins wrote: »

Its not necessarily a poor return,

It's a punt as there's no guaranteed return, potentially even a loss. BTL is a business not an investment. Tenants will know their rights far better than amateur LL's as well.