Hi All,

I'm currently renting in London but I'm thinking of buying. Possible early next year when prices have dropped off. I'm thinking about buying a 3 bed house or apartment and renting out a couple of rooms.

I'll hopefully be able to cover the mortgage with at least one room rented out including my own salary etc. There is an element of risk involved in this. If I'm out of work or one or both of the rooms are vacant for a period of time I could have a problem paying the mortagage. Given the demand for rental property in London I don't think I'll be stuck for tenants. I also plan to keep a stash of cash to help me out if I'm stuck.

Its quite common for people to rent out a single room, but by bumping this up to two the element of risk also increases given the fact that I will be relying on the income to pay the mortgage.

I'm interested to hear peoples views on this. Also interested to hear from people who have had a bad experience with renting out rooms in terms of the tenants themselves and relying on the income.

Cheers,

TheAztec

That's done a lot in the USA.

My question is: how hard is it to get your roommates out if you can't get along with them? Check your local law so that you know the answer to that before you buy.

Can you qualify for a mortgage if you can't make the payments by yourself?

Have a contingency fund for when things go wrong. You should be able to avoid dry spells of any more than a couple of months for a room, but having a contingency fund of perhaps 3 or 4 months rent will give you peace of mind and mean that you don’t rent a room to someone you wouldn’t normally just because you have to rent the room.

Its good that you are staying in the house. It means you are there to see what’s going on. If anything is happening that shouldn’t you can nip it in the bud quickly. This will appeal to potential renters, so slip it in when you have them round to view the place.

As for selecting people to rent from you, go with your gut feel. If they sound rough over the phone then you probably don’t want them in your house, just say you are sorry, room has been rented. If you have them round and something just doesn’t seem right about the person, or if don’t like them, then don’t rent to them! There will be plenty of other potential renters along soon. That advice is from experience. This is your home (not a B2L property) so you don’t want little things they do or don’t do niggling you. You want the people to respect the property and those they are sharing it with.

It can also be worth having your other renter present for viewings. They don’t need to be there all the time, perhaps just bump into the viewer in the corridor and introduce themselves. They’ll get a feel for whether they will get on.

I’ve been fortunate when renting rooms. My worst renter was slow with the rent and boy did he have opinions that the liked to view. (Not particularly well informed views at that!) He was out on his ear shortly after breaking a tumbler and leaving that tumbler in the kitchen sink. Muggins was clearing up his mess (number of plates etc that needed cleaned in the sink) and didn’t see that it was broken. Tumbler shattered when I was cleaning it. I required stitches from A&E after they had removed splinters of glass from my hand. Other flat mate had been away that weekend, so I knew it was he who had left the broken tumbler in the sink. He didn’t apologise. Anyway, gave him his month’s notice and he moved on. I told him I was selling the property and wanted the flat empty so I could give it a lick of paint and sell on. The other flatmate played along with this as he wanted him out too. Otherwise flatmates were fine. They all paid on time and treated the place with respect.

One final note that I’m sure you will have thought of. If you charge a little less than the competition you can be more elective with who you rent to.

The Soup Dragon,

Thanks for your input. I would be even more worried if it was your other flatmate who cut his hands on the broken tumbler and not you. If a tenant injures themselves on your premisis can you be held liable or do you normally get the tenant to sign their life away on the lease? Not sure if thats possible?

Good work on pushing the difficult tenant out. It can be hard to do that without causing disruption in the flat. I'm living with someone whos very difficult to live with at the moment. We wont be getting him to sign the next lease. Just have to hold out for another month or so before the lease is up.

TheAztec.

TheAztec. It could have been worse if other flatmate had cut his hand on the tumbler, but all depends on the flat mate. If you selected well then you probably get on well with them and they’ll see I has been the other flat mate’s fault and not yours. However, it will still be possible for them to sue you / push for compensation. I didn’t have them signing anything in contract to exonerate myself of responsibility.

Getting on well with flat mates is key. They are likely to help you get rid of the new tenant if things aren’t working out.

I'm currently considering a similar thing, and in my exploring so far I have found that if you are intending to live in and rent the premises you may struggle to find a buy to let mortgage. in the words of my friendly mortgage advisor, this just means you would have to lie if you wanted to, but it may still present a problem if you were considering that course of action.

it's blatantly the best way to do it though isnt it?

It's naughty and I wouldn't want to say it's best for you.

Multiple occupany wise it will help if you are related to one of the lodgers as their is a maximum of 2 unrealted people before multiple occupany license would be applicable. (For multiple occupancy read costs. Cost of making necessary saftery changes to your flat, cost of license and tax on rental income (not certain of that part - its a long time since I've looked into it.))

In my student days I can remember visiting a flat where the owner asked one of his flatmates (friend from Uni) that he say they were related if authorities came round to inspect the flat. (Being in student area the authorities knew that most flats had several unrelated parties living together.)