Buy one property out right or buy two with Mortgage`s?

Jigthings

Hi I hope I'm in the right section,

I'm just in the process of buying a flat to rent out, im in a position where I could buy it outright but im wondering if I would be better to get a 50% BTL mortgage and pay off the mortgage over 10 years?  It looks like the rent would cover the Mortgage with a bit left over which could be used for repairs, Electric/gas checks.

I'm 53 paying 40% tax in my current job so im thinking rather than pay tax on the whole rent would I be better to take up a mortgage... or buy two properties both with mortgages and rent both out and sit it out until I retire.

I think that makes sense any advice welcome, Cheers Pete

GDB2222

Don't let the tax drive your decision. That's the tail wagging the dog.

You probably know that you only get basic rate tax relief on the mortgage interest, anyway.

Two properties is twice as much hassle, and twice as much risk if things go wrong. Twice as much potential profit, too, of course.

You haven't said what other assets you have. It would be better to diversify your investments.

In any case, I suggest you buy one, get used to what's involved in being a landlord, and then consider whether to mortgage the flat and buy another in a year or two.

Jigthings

Thanks for the reply GDB, sorry yep the outlay would be around 25% of my savings which not earning a great deal, another 22% are in Premium bonds and a ISA. 

Cheers Pete

dimbo61

Flat or House ?
Leasehold or Freehold ?
Ground rent/Service/Management charges ?
Buy outright or with a BTL mortgage ?
As a higher rate taxpayer do you have a good company pension ?
Can you pay more in and get extra employer contributions ?
Sorry I think your TOO Old for a LISA ISA

Oh so many things to consider in any investment.
Yield, Capital growth, 
Type of property/Size/Bedrooms/Bathrooms, Garden and Garage.
Local market, Tenants !!!!
EICR, EPC GSC etc

There are links at the top of this board about the hundreds of Laws, Rules and Regs to owning and operating a residential business