How much money to be landlord?

FrankR

How much money does one need to make a living out of being a landlord?
To start with? To build a property portfolio?

Slithery

It depends what you mean by living.

The extreme leveraging of yesteryear is no more so at least a couple of million would be a good start.

FrankR

Slithery wrote: »

It depends what you mean by living.

The extreme leveraging of yesteryear is no more so at least a couple of million would be a good start.

I mean, living in an apartment and owning 3 - 4 terraced houses. Charge £700 per month rent.
700 * 4 (four houses) x 12 = around £33,000 per year.

That seems OK to me.


Are you saying this is no longer possible? Or are you trying to put me off being a landlord *he's just another meanie landlord sucking people dry*!!

Of course, who knows what will happen to the housing market after Brexit. It looks like a NO DEAL is likely. Could we see a 40% drop in prices? I don't think so because demand still exceeds supply, and until that changes, I don't think house prices will decrease... What do you think?

Comms69

FrankR wrote: »

I mean, living in an apartment and owning 3 - 4 terraced houses. Charge £700 per month rent.
700 * 4 (four houses) x 12 = around £33,000 per year.

That seems OK to me. - What about taxes, mortgages, repairs, void periods, evictions, legal fees?


Are you saying this is no longer possible? Or are you trying to put me off being a landlord *he's just another meanie landlord sucking people dry*!! - You asked the wrong questions, so you will not be a good landlord I think

Of course, who knows what will happen to the housing market after Brexit. It looks like a NO DEAL is likely. Could we see a 40% drop in prices? - no I don't think so because demand still exceeds supply, and until that changes, I don't think house prices will decrease... What do you think?

The sun will rise on the 1st November, people will still go to work. (though some may be crying as they do)

Slithery

FrankR wrote: »

I mean, living in an apartment and owning 3 - 4 terraced houses. Charge £700 per month rent.
700 * 4 (four houses) x 12 = around £33,000 per year.

That seems OK to me.

So you're just choosing to ignore tax, tenant referencing, contract setup fees, maintenance, deposit protection, 2 months of voids per year, EA fees, extra SDLT, etc, etc..

What do your detailed budget calculations for these particular properties give as a final income after taking all of the above into account?

And how much will it cost to buy these properties outright?

PS - I was previously a homeowner and now rent. I've never been a landlord.

FrankR

Slithery wrote: »

So you're just choosing to ignore tax, tenant referencing, contract setup fees, maintenance, deposit protection, 2 months of voids per year, EA fees, extra SDLT, etc, etc..

What does your detailed budget calculations for these particular properties give as a final income after taking all of the above into account?

And how much will it cost to buy these properties outright?

PS - I was previously a homeowner and now rent. I've never been a landlord.

I understand there are costs. But there are a lot of but to let landlords around. This tells me it is profitable. So these costs must be less than the money you get in rent. So it is profitable.

Question is, will it be as profitable after Brexit? Or will these costs increase, house price value decline, leaving the landlord out of pocket, or with very tight margins?

Slithery

FrankR wrote: »

I understand there are costs. But there are a lot of but to let landlords around. This tells me it is profitable.

No it doesn't. It also may be only very slightly profitable, with a far lower return than investing in your pension, or a balanced portfolio.

A lot of these landlords are currently trying to sell up all of their properties before the new tax rules come into force. Whereas others already own a large number of properties outright due to the no longer feasible leveraging.

You need to read the following thread and all of the links that it contains, and then prepare a detailed budget for your chosen properties.

Only then will you know if it's a feasible choice and what your actual income will be.

[URL="https://forums.moneysavingexpert.com/discussion/5180214in Eng/Wales: Guides for landlords and tenants[/URL]

Gycraig

How longs a piece of string. No one knows how brexit will affect things

eddddy

An online agency published its Net Rental Yields by region, a year ago:
https://www.simplelandlordsinsurance.com/landlord-hub/news/best-buy-to-let-yields

Their findings were:

• The Midlands performed best with net yields of 6.6%
• London performed worst with net yields of 3.7%

So if you can match their performance (noting that they are experienced professionals, and probably have economies of scale) to end up with the £33k that you're looking for ...

• In the Midlands you'd need £500k
• In London you'd need £890k

Slithery

Gycraig wrote: »

How longs a piece of string.

It's this long.

FrankR

Slithery wrote: »

No it doesn't. It also may be only very slightly profitable, with a far lower return than investing in your pension, or a balanced portfolio.

A lot of these landlords are currently trying to sell up all of their properties before the new tax rules come into force. Whereas others already own a large number of properties outright due to the no longer feasible leveraging.

You need to read the following thread and all of the links that it contains, and then prepare a detailed budget for your chosen properties.

Only then will you know if it's a feasible choice and what your actual income will be.

[URL="https://forums.moneysavingexpert.com/discussion/5180214in Eng/Wales: Guides for landlords and tenants[/URL]

How does the new tax rules affect landlords?
What is leveraging? Why is leveraging no longer feasible?