Buy to let while in a council house

HouseTargaryen

There doesn't appear to be any rules to say that I can't own a property, only that this council house has to be the home I live in. So from the council side, I assume I am OK. Although please let me know if you think I'm wrong (but please no moral objections). 

From the lender side, would I come across any problems as a council house tenant? I could in the near future get a buy to let property based on online calculators and my credit rating is really good.

I know some people think this is morally wrong but will I come across any barriers? I currently pay £400 a month for my 2 bed house but I couldn't afford to buy a house in my village and my kids would be devistated if we moved area. But I can afford to buy a house in a cheaper area so thought this may be a good investment idea. 

Slithery

Finding a lender will be difficult. Most BtL mortgages require you to already own your main residence.

elsien

Have you read all the relevant information about what being a landlord involves, given the near impossibility of evicting anyone any time soon? 

There is another thread on here from someone who reckoned they managed it, and a degree of scepticism from other posters about how genuine it was.
https://forums.moneysavingexpert.com/discussion/4950858/buying-a-property-while-on-social-housing
Worth a read because it does answer some of your questions and the rules vary depending on your council/social landlord‘a policy. 

dimbo61

Everything is possible if you have the money ?
Now if you live in a council house and pay rent each month a BTL lender might assume that you want to Buy a BTL property to live in with an Interest Only mortgage.
Most BTL mortgage are also broker only so maybe you need to speak to a broker about your plans.
20/25% deposit, fees to set up mortgage so 1/1.5% and other costs.
Rent must be 125/150% of mortgage cost and you need to have a business plan, know your responsibilities as a landlord.
EPC EICR GSC Pat testing and legionnaires checks, preparing a property for rent, NRLA, Video inventory, AST and other legal documents. Right to Rent, how to rent, deposits etc

theartfullodger

Slithery said:

Finding a lender will be difficult. Most BtL mortgages require you to already own your main residence.

When I went for BTL mortgage not living in my own residence (wife's, I'm but a lodger) needed at least £25k income (pensions, ok in my case) but also had other assets, investments etc .

HampshireH

HouseTargaryen said:

There doesn't appear to be any rules to say that I can't own a property, only that this council house has to be the home I live in. So from the council side, I assume I am OK. Although please let me know if you think I'm wrong (but please no moral objections). 

From the lender side, would I come across any problems as a council house tenant? I could in the near future get a buy to let property based on online calculators and my credit rating is really good.

I know some people think this is morally wrong but will I come across any barriers? I currently pay £400 a month for my 2 bed house but I couldn't afford to buy a house in my village and my kids would be devistated if we moved area. But I can afford to buy a house in a cheaper area so thought this may be a good investment idea. 

Depends 9n your tenancy as to whether you can be evicted for doing so or not.

Assured tenancy. No you are assessed pre-tenancy and not afterwards. Unless you screw up it's a home for life pretty much.

Fixed term. Yes you are assessed at the end of the fixed term. If your situation has changed such as savings /own a property then you will be served notice to leave and they will go to court to end the fixed term. 

These tenancies were introduced because social housing is for those who need it. Not those who have the luxury of enough money in the bank to buy a home for someone else to live it, whilst saving money on a reduced rent. It gave social housing landlords the powers to reallocate to those in more need.

steampowered

If you would like to own a property in your village one day, you could consider saving into a Lifetime ISA. If you qualify, the government will top-up 25% which can be used towards a home of your own.

Also, it doesn't sound like you would have the financial resources to cope if your tenant stopped paying the rent. It is best not to over-leverage yourself with BTL as it is a business, so you will not be protected if your business goes badly.

You could consider investing in stocks & shares through a stocks & shares ISA. Simply invest in a simple diversified investment fund, like the Vanguard Lifestrategy funds. That is good way of investing for the long term - probably would generate a better return than BTL.

[Deleted User]

HouseTargaryen said:

There doesn't appear to be any rules to say that I can't own a property, only that this council house has to be the home I live in. So from the council side, I assume I am OK. Although please let me know if you think I'm wrong (but please no moral objections). 

From the lender side, would I come across any problems as a council house tenant? I could in the near future get a buy to let property based on online calculators and my credit rating is really good.

I know some people think this is morally wrong but will I come across any barriers? I currently pay £400 a month for my 2 bed house but I couldn't afford to buy a house in my village and my kids would be devistated if we moved area. But I can afford to buy a house in a cheaper area so thought this may be a good investment idea. 

I can't read your tenancy agreement from here to see if there are any terms that would prevent you from owning another property whilst remaining a council tenant.

Any potential barriers are likely to come from the mortgage lenders as you are not a home owner and there is likely to be a minimum income requirement plus a healthy deposit, at least 25% I reckon.

HouseTargaryen

Thanks for the advice everyone. 

Norman_Castle

Can you buy your current home through the right to buy?

FBaby

I got a BTL mortgage with NatWest without owning the a property I live in (in husband name) but that was in an income over £50k and high ICR. 

Why would you want to become a landlord? Do you have the every day fund and savings to deal with unexpected costs that come with it?