Buy to Let Property

Grumpy_chap

Miranda, I think you need to be clearer about what your financial objectives are and then to consider how these can be met.

I really do not think that BTL is the best route for you at this time as you really have not done the research required and seem to have a very poor understanding of the risks and rewards.

Not to mention the confusion about "owning" a property abroad that you "gave" to your mother (so you no longer own that property?) But also wanting to use HTB and FTB allowances where not within the rules of those schemes.

If you still want to follow the BTL route, then start with professional advice as you need far more than can be gleaned from a forum such as this.

AlexMac

Miranda25 said:

AlexMac, I brave enough :-)) I was away from parents home at age of 16 (distance between me & my parents was 6 hours flight) and I was by myself (not with relatives). I even was brave when I came to the UK without speaking English at all (as I learned French at school-university).
You know I looked at prices in Dartford/ Gravesend as I want to find house for myself too. I noticed that prices are lower compare to other areas in south-east. But forumites told me that Dartford is not such a good area to live, although it might be fine for investment.
Don't you think that it might be a good option for me to buy a property and pass it to a social landlord (to avoid maintenance problems)? Can I avoid squatting problems too? :-))

Miranda; with this attitude, you are my kind of brave woman.  Thankfully I am already married, immensely happily to a wonderful person,  and probably 40 years too old for you, or I would be stalking you!

Anyway, I guess that whatever you do, you will be successful, as you have the right attitude, and clearly, much determination.

So you don't need my advice - you will make the right investment decisions...
...(although on the basis of my experience, the HA (Housing Association/)- social landlord idea might fly.  But you say you don't like flats; whereas my 2 ideal BTL properties are ex-local authority flats, which are obviously perfect social rentals. The HAs know that a Council freeholder will always ensure the building -  in both of my cases, a small block of flats - is safe, insured and well maintained.  Something less certain with freehold properties whose condition is dow to the individual freehold owner- some of whom are negligent graspin' bestids?  So ask around in any area you choose to invest in, to ask if there are HAs or Councils desperate to find properties...?)

So although you don't need my advice, may I ask one challenging question?

DO YOU WANT AN INVESTMENT, OR A FUTURE HOME?

You hint that you would like to buy a property to let out; a BTL (Buy to Let).  But, almost in the same breath, you imply that you want to buy a property for your own, eventual future use?   The two might not be compatible?

I did just that; once, and got away with it!  20-odd years ago. I was living with my (then) girlfriend (now the forever partner, wife and love of my life) and I bought a nearby wreck at auction, on a mortgage (nearly losing my deposit, as I was daft enough to think I could  buy an auction property on a mortgage with a completion deadline of 28 days!).  Anyway, it came off, and I bought, then renovated the wreck.    When, a couple of years after, we married, I paid off the loan and turned it into a rental... But usually, I wouldn't confuse a BTL and my primary residence...  Although that time, I got away with it... immensely profitably.

So, as Clint Eastwood says in the film Dirty Harry, you gotta ask yourself, "Punk- do you feel lucky? "

Bonsoir ma p'tite

Miranda25

AlexMac said:

Miranda25 said:

AlexMac, I brave enough :-)) I was away from parents home at age of 16 (distance between me & my parents was 6 hours flight) and I was by myself (not with relatives). I even was brave when I came to the UK without speaking English at all (as I learned French at school-university).
You know I looked at prices in Dartford/ Gravesend as I want to find house for myself too. I noticed that prices are lower compare to other areas in south-east. But forumites told me that Dartford is not such a good area to live, although it might be fine for investment.
Don't you think that it might be a good option for me to buy a property and pass it to a social landlord (to avoid maintenance problems)? Can I avoid squatting problems too? :-))

Miranda; with this attitude, you are my kind of brave woman.  Thankfully I am already married, immensely happily to a wonderful person,  and probably 40 years too old for you, or I would be stalking you!

Anyway, I guess that whatever you do, you will be successful, as you have the right attitude, and clearly, much determination.

So you don't need my advice - you will make the right investment decisions...
...(although on the basis of my experience, the HA (Housing Association/)- social landlord idea might fly.  But you say you don't like flats; whereas my 2 ideal BTL properties are ex-local authority flats, which are obviously perfect social rentals. The HAs know that a Council freeholder will always ensure the building -  in both of my cases, a small block of flats - is safe, insured and well maintained.  Something less certain with freehold properties whose condition is dow to the individual freehold owner- some of whom are negligent graspin' bestids?  So ask around in any area you choose to invest in, to ask if there are HAs or Councils desperate to find properties...?)

So although you don't need my advice, may I ask one challenging question?

DO YOU WANT AN INVESTMENT, OR A FUTURE HOME?

You hint that you would like to buy a property to let out; a BTL (Buy to Let).  But, almost in the same breath, you imply that you want to buy a property for your own, eventual future use?   The two might not be compatible?

I did just that; once, and got away with it!  20-odd years ago. I was living with my (then) girlfriend (now the forever partner, wife and love of my life) and I bought a nearby wreck at auction, on a mortgage (nearly losing my deposit, as I was daft enough to think I could  buy an auction property on a mortgage with a completion deadline of 28 days!).  Anyway, it came off, and I bought, then renovated the wreck.    When, a couple of years after, we married, I paid off the loan and turned it into a rental... But usually, I wouldn't confuse a BTL and my primary residence...  Although that time, I got away with it... immensely profitably.

So, as Clint Eastwood says in the film Dirty Harry, you gotta ask yourself, "Punk- do you feel lucky? "

Bonsoir ma p'tite

I want a future home -house near London which I cannot afford. 
That's why in order to utilise "mortgage allowance" I thought about investment (flat) and to try to turn debt into equity.

But everybody here is telling me that it is not a nice idea and maybe they are right. But in order for me to assess a feasibility criteria I need to figure out the area which I am going to look at and this is was my initial question.

Mutton_Geoff

AlexMac said

Miranda; with this attitude, you are my kind of brave woman.  Thankfully I am already married, immensely happily to a wonderful person,  and probably 40 years too old for you, or I would be stalking you!

...

Bonsoir ma p'tite

Surely you’ve been on internet forums long enough to know everything may not be as it first appears?

Slithery

Miranda25 said:

That's why in order to utilise "mortgage allowance" I thought about investment (flat) and to try to turn debt into equity.

You've mentioned this 'mortgage allowance' a few times now. That phrase has no legal meaning so none of us know what you are referring to?

There is no magic way to turn debt into equity, you need to pay off everything that you owe, then build up 10's of thousands in savings, and just maybe then you'll be in a position to start looking at running a residential lettings business. It's not the 90's any more...

hazyjo

Was also about to query 'mortgage allowance'. By having a mortgage, it doesn't make you more credit worthy to take on another one. You'll still have to earn enough, which may mean selling any BTL (which you probably won't be able to get in the first place) which may be in negative equity or you may break even. Prices have barely moved in the last 4 years.

Miranda25

Slithery said:

Miranda25 said:

That's why in order to utilise "mortgage allowance" I thought about investment (flat) and to try to turn debt into equity.

You've mentioned this 'mortgage allowance' a few times now. That phrase has no legal meaning so none of us know what you are referring to?

There is no magic way to turn debt into equity, you need to pay off everything that you owe, then build up 10's of thousands in savings, and just maybe then you'll be in a position to start looking at running a residential lettings business. It's not the 90's any more...

Slithery,
I am wondering what was in 90's in the UK? Am I missing something :-))

Or you don't have to wait for 10's of thousands in savings... You can just figure out nice home in a nice location for the nice price and rent it from agency, then rent out every room to other people. Is it legal as I know people do it?

Miranda25

hazyjo said:

Was also about to query 'mortgage allowance'. By having a mortgage, it doesn't make you more credit worthy to take on another one. You'll still have to earn enough, which may mean selling any BTL (which you probably won't be able to get in the first place) which may be in negative equity or you may break even. Prices have barely moved in the last 4 years.

I thought it is my own terminology but google also said "mortgage allowance" (see attachment)
I meant amount of money which bank can lend me.

[Deleted User]

Miranda25 said:

Slithery said:

Miranda25 said:

That's why in order to utilise "mortgage allowance" I thought about investment (flat) and to try to turn debt into equity.

You've mentioned this 'mortgage allowance' a few times now. That phrase has no legal meaning so none of us know what you are referring to?

There is no magic way to turn debt into equity, you need to pay off everything that you owe, then build up 10's of thousands in savings, and just maybe then you'll be in a position to start looking at running a residential lettings business. It's not the 90's any more...

Slithery,
I am wondering what was in 90's in the UK? Am I missing something :-))

Or you don't have to wait for 10's of thousands in savings... You can just figure out nice home in a nice location for the nice price and rent it from agency, then rent out every room to other people. Is it legal as I know people do it?

It’s almost certainly a breach of the tenancy agreement. Could even fall foul of HMO legislation too. 

Grumpy_chap

Miranda,
I am quite concerned that BTL is not for you and your lack of knowledge on the subject could mean disaster looming if you go down this route.
Maybe it would be easier to assist if, rather than focusing on having a BTL, you changed tack to focus on your current position and your goals.  This might be easier for people to suggest suitable paths from "now" to "there".  It is also hard when, half way through the discussion you reveal that you bought a property in another country that may or may not be yours now (given to mother).