But to let rather than save?

melanzana

Buy gold bars or silver.

Hoploz

There would be capital gains tax to pay when you sell as well.

It's not an easy way to make money or a substitute for basic saving. But it can work.

Personally I find it's much easier to deal with properties closer to home as when they are far away you think the agent will deal with everything but what you end up with is them calling tradesmen all the time whenever any small problem is reported, alongside Chinese whispers of the agent interpreting what the tenant tells them is the problem, all at £100 a time.
This isn't always the case but it does happen and when a property is close to home it's so much easier to be able to pop by and sort the problem yourself when the tap fails because nobody has cleaned the limescale off etc etc.

chucknorris

Hoploz wrote: »

There would be capital gains tax to pay when you sell as well.

That really isn't the problem, our CGT bill will be about £800k, oh how I wish that it was £800m (in realty I don't wish that, I'm happy with what we already have).

Sashabella

Huge thanks for all your replies. It's certainly given me lots to think about. It seems like shares might be the better option. I think part of the problem is I have a romantic idea of owning somewhere in my home town where all my family are. Definitely not a good basis for an investment!!

FBaby

What's the market like where you are and what do you want to do with the money. What you wouldn't want is to use any equity to fund their university cost to find that in 10 years time, the market has crashed and you actually are in negative equity.

csgohan4

A BTL is not quick money, OP your not the only one thinking this, we get a least 1 thread a week on BTL wannabees who think they can be millionaires from a BTL and have not clue the implications for becoming a LL.

Sashabella

The market is pretty stable. Think north east ex mining town with lots of reinvestment.

I would be thinking to potentially sell the property in 15 years when I would expect the mortgage to be paid off.

What I would do is pay the £300 that I save each month for the kids off the mortgage. Any rent received would be put in a separate account to cover insurance, maintenance, fees etc. If this money builds up then I could potentially over pay the mortgage, but I would definitely leave a decent sum to cover rainy days.

I certainly wouldn't expect to become a millionaire! I would like a mortgage free flat that I could either sell or use rental income to help fund the kids' further education.

AnotherJoe

So its a gamble between property price inflation and growth in the stock market over 15 years?

With a property you have the whole £70k appreciating from day 1.
With shares you dont, you only have what you've put in each month. So only £300 has the full 15 years for example, and the last £300 has one month.
With a property you have at the end of the term CGT to pay, with shares you wont (put them in an ISA)
With shares its hassle free and very low cost
With property its a fair amount of hassle and high cost
With property there are incomings (rent) and outgoings (mortgage & tax & maintenance costs)
With shares there are only incomings (dividends) but they will be lower than rent

You should try and model this with a spreadsheet and make some guesses at values for these.

If you cant model it yourself pay an IFA to do it, rather than jump into one or the other, its worth one months investment equivalent to ensure you arent making the wrong choice.

Crashy_Time

Take some advice from the experts!


https://www.theguardian.com/money/2016/dec/09/buy-to-let-landlord-days-numbered-fergus-wilson-tax-changes-mortgage-rules


According to some of the experts on here this guy made millions from selling up months ago.....but according to this he is still "in the process" of selling? Would be terrible to have milked the bubble all the way up only to fall at the last hurdle....wouldn`t it? :rotfl:

Crashy_Time

Sashabella wrote: »

The market is pretty stable. Think north east ex mining town with lots of reinvestment.

I would be thinking to potentially sell the property in 15 years when I would expect the mortgage to be paid off.

What I would do is pay the £300 that I save each month for the kids off the mortgage. Any rent received would be put in a separate account to cover insurance, maintenance, fees etc. If this money builds up then I could potentially over pay the mortgage, but I would definitely leave a decent sum to cover rainy days.

I certainly wouldn't expect to become a millionaire! I would like a mortgage free flat that I could either sell or use rental income to help fund the kids' further education.

You would get a bigger potential pay-off sticking it in premium bonds.