23 years old - First time buyer.. potentially BTL?

chris9393

Hi,

So I'm currently 23, still living at home and working full time in my career looking to buy my first home. I've spoken to a mortgage advisor through a scheme at my place of work and with my savings of £15,000 (subject to change the more I save) they said I can expect to be offered around £150,000.

Now where I live in London that can get you absolutely nothing. I've been looking at properties in Portsmouth near the university where you can get a lot more for your money and have seen a few 2 - 3 bedroom houses and flats around the 150k mark.

I work in central London so if I were to purchase a property down in Portsmouth, the commute to work would likely be far too much. This is where I'm now looking at BTL but you need a far bigger deposit for a mortgage which quite frankly at the moment I do not have.

Would there be anything stopping me from purchasing a property, living in it for say 6 months and if the commute does become too much then rent the property out and start living back at home again?

Unfortunately it seems the only way for myself to get on the property market nowadays is to purchase much further out of London.

If a similar question has been asked to this then I apologise..

Thanks

Giddypip

The T&Cs of your residential mortgage may allow you 'consent to let' for a short period and then you would either have to move back in, convert to a buy to let mortgage or sell.
My brother was using consent to let for about 3 years then the mortgage company said no more, he could not afford to get a buy to let mortgage so had to evict his tenants and move back in.

marksoton

Yes, the mortgage company. They'll see exactly what you've done.

Do you actually understand what's involved in being a LL?

Oh, and Portsmouth is cheap for a reason...

Marvel1

If considering a busness of landlord, research the law you must follow and rights of tenents.

booksurr

a Portsmouth to London annual season ticket (rail) is >£5,000

still think your idea is realistic, leaving aside the question of you being unlikely to get a conversion to BTL?

mrginge

When you find a property in Portsmouth and apply for a mortgage, the bank will ask you where you currently live and work.

They will then see exactly what your plan is and politely decline your request.

Planet_Switzerland

Several years ago I thought about buying somewhere cheaper to rent out because of the house prices in London.


In 2008 when the credit crunch hit, a friend of mine who lives up north bought a repossessed flat for a bargain price. He's just sold it for 4k less than he paid for it. He has paid off more than 4k capital in that time but when you add it the costs of both buying it and selling it he's actually made a loss overall. That's not to mention the service charges he's paid for over that time as well.


Over that same period, the rents in London have probably gone up by 50%, possibly even more. Fortunately I decided instead to save like mad and try to get on the property ladder in London which hopefully I'm about to do.


As you are thinking of renting out the property I take it you're happy staying at home for the foreseeable future and have no intention of moving to Portsmouth either. Therefore you're better off saving for a bigger deposit and trying to buy somewhere in London.

DCFC79

Do you have a contingency fund for say a new boiler ?

[Deleted User]

I'd not do anything til I'd checked the brokers estimation. You are living at home ( mininal expense), earning enough to get a £150k mortgage, but only have a £15k deposit. I suspect you need to look at your finances, save up a healthier deposit and wait until that happens.

As already pointed out, BTL may not be the investment opportunity you are thinking. There are costs involved. What is the rental on a £150k house in that area? What are the agency fees etc.