Buy to Let - One for cash or 2 mortgaged?

seven-day-weekend

Pixie5740 wrote: »

Yeah, because house prices have never fallen. :cool:

But I will still have the property. It's not going to be worth nothing. Another investment might disappear completely.

Pixie5740

seven-day-weekend wrote: »

But I will still have the property. It's not going to be worth nothing. Another investment might disappear completely.

Unless you go for something high risk involving a Nigerian prince trying to get his millions out of the country it's unlikely you'd lose all your money overnight. Besides you shouldn't put all your eggs in one basket.

Property isn't bulletproof. Buy in the wrong area and you could end up with a property no one will want to buy, or there could be something wrong with the property that means future buyers can't get a mortgage, or several things can go wrong.

Pixie5740

Stevo2800 wrote: »

It is possible to achieve 8% returns through other types of investments and given that the government is taking steps to make BTL seem less attractive in might be worth investigating other types of investments before sinking the lion's share of your money in BTL.

This has been stated several times, what types of investment are they then? To reiterate, I am Capital & Property rich, income poor. I need a few hundred quid a month to live on. Part time work that I can fit in is very variable. Carers allowance, if I get it, is hardly a king's ransome.

That very much depends on your appetite for risk. There's a whole board dedicated to savings & investments. It might turn out that BTL is right for you but you should at least investigate the alternatives. Maybe go see an IFA.

Person_one

Stevo2800 wrote: »

I don't pay tax at the moment because I spend most of my time caring for my dad, mother in law and grand-niece. I'm waiting for carers allowance to be agreed.

With that level of caring responsibility, will you have the time and energy to run a business too? Especially one that may well require your time/attention at all times of day or night or at weekends? Will you have the cashflow to deal with issues that may crop up such as leaks, broken boilers, fires, floods etc. until your insurance pays out weeks later?

As landlord, even if you use an agent to manage the property, its still a lot of work and everything is still ultimately your responsibility.

seven-day-weekend

Pixie5740 wrote: »

Unless you go for something high risk involving a Nigerian prince trying to get his millions out of the country it's unlikely you'd lose all your money overnight. Besides you shouldn't put all your eggs in one basket.

Property isn't bulletproof. Buy in the wrong area and you could end up with a property no one will want to buy, or there could be something wrong with the property that means future buyers can't get a mortgage, or several things can go wrong.

I do have other money elsewhere.

And my property is not in the wrong place, I made sure of that before I bought it.

Pixie5740

seven-day-weekend wrote: »

I do have other money elsewhere.

And my property is not in the wrong place, I made sure of that before I bought it.

Maybe you could give the OP a shot of your crystal ball then.

The point I'm trying to get across is that like any investment there is risk attached to letting property. I'm not sure it's helpful to make out like you could lose all your money overnight with other types of investments but that you can't lose with property. Get it wrong and letting property can turn out to be a very expensive lesson. Get it right and it can be a nice wee earner. Either way there is risk involved.

seven-day-weekend

Pixie5740 wrote: »

Maybe you could give the OP a shot of your crystal ball then.

The point I'm trying to get across is that like any investment there is risk attached to letting property. I'm not sure it's helpful to make out like you could lose all your money overnight with other types of investments but that you can't lose with property. Get it wrong and letting property can turn out to be a very expensive lesson. Get it right and it can be a nice wee earner. Either way there is risk involved.

Yes your house can devalue and if you sell it for less than you paid for it you have lost money. But you won't have lost ALL your money. That's the point I'm trying to make.

I admit I am a novice with investments. I'm just saying that was my reasoning. Of course there are risks with any investment, I persoanlly don't think property is as big a risk.

mumps

Person_one wrote: »

With that level of caring responsibility, will you have the time and energy to run a business too? Especially one that may well require your time/attention at all times of day or night or at weekends? Will you have the cashflow to deal with issues that may crop up such as leaks, broken boilers, fires, floods etc. until your insurance pays out weeks later?

As landlord, even if you use an agent to manage the property, its still a lot of work and everything is still ultimately your responsibility.

I have a good agent and have very little bother. They use a team of builders/electricians/plumbers and you don't have to pay upfront, they take it from the rent at the end of the month unless it is a really big job.