Buying to Let? Advice, help!

kzzhar0

So my partner are expecting our first child in a couple of months. My partner owns the house we live in and we have lived here for the past few years. We are looking to move into our forever home however I know that with covid etc everything has slowed down quite a lot. We've had our house valued and are putting it on the market however new properties are coming up and selling VERY quickly (advertised on a friday, gone on a monday). We know that we'll probably not be able to move until the baby is a few months old or even after. I have managed to save about £8k so far and he will obviously have quite a big deposit from this house (he bought it very cheaply, renovated and now its worth quite a lot more with a lot of the mortgage paid). 
My question is about buying to let. Could this be a worthwhile investment for myself whilst we are still looking? I have enough of a deposit to buy a flat in one of the desirable areas near us (both for students and young professionals) and I'm wondering whether it could be a good investment and although I'd spend buying the property and possibly doing a little work on it, it could be a good revenue to have and enable us to save a little extra. Or is it a bad idea? I know it can obviously be really stressful and maybe don't need this on top of having a baby too. Its just a fleeting idea really but wanted to know if anybody has done this before? Thanks

EDIT - this isn't something I'd be looking to buy and sell in the space of a couple of months but could be a good long term investment.

princeofpounds

You sound like you are suggesting that you BTL for a few months until you have finished looking?

If so, that would be a stupid idea.

grumiofoundation

As a ‘fleeting idea’ it may seem great but have you looked into:

 the financials of running this business, taxes, agents fees, money to cover void periods/repairs, potential legal fees. also factoring in the increased stamp duty costs and potentially lower affordability for your next home. 

being a landlord - it’s not easy - all the rules and regulations you most follow. 

If you really are suggesting doing it for a few months then that’s going to cost you money simply due to the cost of buying and selling. 

kzzhar0

princeofpounds said:

You sound like you are suggesting that you BTL for a few months until you have finished looking?

If so, that would be a stupid idea.

I don't own property and would like to be able to invest in something that may give me a bit of income on the side and potentially sell on a few years down the line when we eventually find somewhere to move as at this rate it could be a long time until we find anywhere. To be honest, who knows what will happen as it may be a really good investment to keep for a lengthy amount of time. I'm just looking for advice of people who have bought properties to let. 
This post is someone with little knowledge of the property market asking for help and I think your reply is a bit unnecessary as its quite rude and doesn't give me any advice. Thanks for taking the time to reply anyway though.  

kzzhar0

grumiofoundation said:

As a ‘fleeting idea’ it may seem great but have you looked into:

 the financials of running this business, taxes, agents fees, money to cover void periods/repairs, potential legal fees. also factoring in the increased stamp duty costs and potentially lower affordability for your next home. 

being a landlord - it’s not easy - all the rules and regulations you most follow. 

If you really are suggesting doing it for a few months then that’s going to cost you money simply due to the cost of buying and selling. 

Thank you. I've edited my post as it wouldn't just be for a property I buy and sell in a couple of months - can see how it looked confusing. I'm looking at it from an investment point of view. I know about the stamp duty which we would have from my partners side as he isn't a first time buyer but would this double if I also owned property? 

foxy-stoat

Stamp duty is the least of your worries/expenses.  I would research being a landlord and come back with any specific questions.

Personally I would keep it simple, work towards having a lower mortgage as possible, 1 property ( your home) and try to keep your life stresses to a minimal.

Once your in a strong financial position - 6 months salary saved up + 25% deposit for the BTL property, then look for business investments.

Caz3121

to clarify....are you planning on using your £8k as a deposit and to cover buying fees or do you have a larger deposit? what sort of price properties would you be looking at?
BTL mortgages often look at 25%+ deposit and decent yield, not owning a property of your own could limit lenders

grumiofoundation

kzzhar0 said:

grumiofoundation said:

As a ‘fleeting idea’ it may seem great but have you looked into:

 the financials of running this business, taxes, agents fees, money to cover void periods/repairs, potential legal fees. also factoring in the increased stamp duty costs and potentially lower affordability for your next home. 

being a landlord - it’s not easy - all the rules and regulations you most follow. 

If you really are suggesting doing it for a few months then that’s going to cost you money simply due to the cost of buying and selling. 

Thank you. I've edited my post as it wouldn't just be for a property I buy and sell in a couple of months - can see how it looked confusing. I'm looking at it from an investment point of view. I know about the stamp duty which we would have from my partners side as he isn't a first time buyer but would this double if I also owned property? 

If you buy a second property (alone or jointly) you pay an extra 3% stamp duty on top of the normal amount (can reclaim if sell first property within 3 years -EDIT - this is incorrect as pointed out as not a previous main residence).

Even a few years (say 5-10) is quite a short term for this type of investment. 

If you are eligible why not open a lifetime ISA - offers 25% bonus on up to 4000 per tex year (so 8000 by this time next year)- much better than any investment. LISA also has to be one for 12 months before use so might not be appropriate but you can always open with £1 today and see where you are at next march (just before end of 2020/2021 tax year) https://www.moneysavingexpert.com/savings/lifetime-isas/

kzzhar0

If you buy a second property (alone or jointly) you pay an extra 3% stamp duty on top of the normal amount (can reclaim if sell first property within 3 years).

Even a few years (say 5-10) is quite a short term for this type of investment. 

If you are eligible why not open a lifetime ISA - offers 25% bonus on up to 4000 per tex year (so 8000 by this time next year)- much better than any investment. LISA also has to be one for 12 months before use so might not be appropriate but you can always open with £1 today and see where you are at next march (just before end of 2020/2021 tax year) https://www.moneysavingexpert.com/savings/lifetime-isas/

Ah right I see! Thanks so much, I'll look into that. 

macman

Having a baby is just a walk in the park compared to the potential stress and sleepless nights that being an amateur landlord will bring...

[Deleted User]

kzzhar0 said:

So my partner are expecting our first child in a couple of months. My partner owns the house we live in and we have lived here for the past few years. We are looking to move into our forever home however I know that with covid etc everything has slowed down quite a lot. We've had our house valued and are putting it on the market however new properties are coming up and selling VERY quickly (advertised on a friday, gone on a monday). We know that we'll probably not be able to move until the baby is a few months old or even after. I have managed to save about £8k so far and he will obviously have quite a big deposit from this house (he bought it very cheaply, renovated and now its worth quite a lot more with a lot of the mortgage paid). 
My question is about buying to let. Could this be a worthwhile investment for myself whilst we are still looking? I have enough of a deposit to buy a flat in one of the desirable areas near us (both for students and young professionals) and I'm wondering whether it could be a good investment and although I'd spend buying the property and possibly doing a little work on it, it could be a good revenue to have and enable us to save a little extra. Or is it a bad idea? I know it can obviously be really stressful and maybe don't need this on top of having a baby too. Its just a fleeting idea really but wanted to know if anybody has done this before? Thanks

EDIT - this isn't something I'd be looking to buy and sell in the space of a couple of months but could be a good long term investment.

What yield do you expect to make from letting such a property?