This week, I have just invested in my first property investment. I thought it was too good to miss out, but am not experienced, but am in a position to learn as I go along. 2 years ago, I was fortunate to win a sum of money to pay off my mortgage. My house is worth £210,000. Was going to upgrade but thought otherwise when I saw a house that I have now bought for £124,000 (definitely worth between £135,000 and £140,000 - close to me and good area). Because I paid off my house, I have had to remortgage for 15% desposit which comes to interest only payments of £96 (5 years term). The BTL mortgage is interest only £507 pcm (again 5 years term) which comes to £603pcm and I can rent it out for between £550 and £580. Is this good? I know this may sound silly as I don't know how to be a landlord but it was just too good for me to miss out on, I felt anyway??? Can anyone tell me if as a BTL investment I have made the right choices with fixed terms etc.. Any advice would be well received. To do the property up, I have a budget of £700 as it only needs a new bathroom and bits and pieces. I have no debt at all (well........didn't have!). The solicitors will cost just under £950. The biggest question is should I have just bought and sold or do what I have done and see how it goes for the next 5 years??? (thought 5 years would let me see if house prices contine on upward trend). Thank You all!

Hi there,

interesting article you have writtenm regarding your acquisition of a BTL property. One thing i did not is that you have probable been really stung on by your solicitors as you would ahve been far better investing the money you saved using a firm like ours elitec onveyancing back into the property. Our service would be far less that £400 and therefore you could ivest you saving of £500 back into your property.

Regards

D

dingram

If you have made a good investment is yet to be seen... you have bought roughly at 15% below market value, which is not too bad, but you have outgoings of over £600 a month, with a rental expectation of only £580, not good economics.

If you found a buyer tomorrow and sold it for £135K, then you would be in a good position, but longer term is very doubtful... what happens if you get bad tenants, or have a 3 month period with no tenants??? yu still have £600+ outgoing with zero incoming. What happens if you have a major repair problem? will you then need to increase income to cover the costs?

i would suggest trying to put the rent up to cover the mortgage. That or sell it for more than you bought but you'd have to get rid of the tenants. You'd struggle to sell it for full market value if the rent won't nearly cover the cost of the mortgage. My advice would be to ring around afew letting agents in the area and see how much rent you can get for it (or did you vale a rental val done by a surveyor?) then either get the rent to cover the mtge payments. Or get rid of tenants and sell to make back the 15%.

Hi,

I have web directory of estate agents from which you can get help a lot, The web site are given above in title.

Thanks

Can you tell us whereabouts in the country the property is? That way I can offer a less generalised answer.

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Michele Andrew
Editor of Square Foot Magazine

hello
iam new to this estate agenciy
how to get clients any clue?

I would be looking for at least 20% BMV in this market and the rent to cover mortgage, with cover for gas certs, insurance, maintenance.

1 is ok but for a model you would need to work to greater margins.

.
Simple - Do not do it - far too risky -

why are sales down by so much - you may get fingers burnt.

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My personal opinion is that with the UK market at the moment, the best and safest option is
to buy Below Market value Properties (BMV) from motivated sellers.

That way you get a discount straight away and your rental yields are higher, which is important I feel if you want to be cash positive...especially with mortgage rates as high as they are.

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Robert Gavin
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