Buy to let

gonzalo

gonzalo

Central Defender
I’m going to be moving back up Sunderland this summer, and my plan is to buy a house to let it out when I get home, and live in my Mam’s annex (anar anar shameful but she lives on her own now since me Step Dad died and my brother who lives nearby is useless frankly).

Obviously I’m going to do my research, however I’m aware buying to let is very different to buying ordinarily. Any advice?
 


1) Check & double check potential tenants
2) Get a bond on minimum 1 month's rent, and get rent by 31st of month for the next month
3) Make sure the return (after costs) exceeds interest available with a bank (house price growth should happen but ain't guaranteed).
4) Consider using an agent, fees are tax deductable and stops you getting calls if they're locked out or there's a problem.

Good luck
 
A lot of small investors with buy to let's want to get out. There have been a lot of tax changes which make it far more difficult to make money than it used to.

Interest payments are no longer tax deductible. Capital gains no longer gets taper relief and the allowance from this year is only 3k. As above, you'd be better off putting your money in an ISA unless you get an absolute bargain.
 
I’ve got one. Was our first house, not an investment. There’s loads of costs associated that people don’t think about. Boiler certifications, electrical certifications. Mortgage is way higher than it was a few years ago.

The years profit we get after costs would he more or wiped out if the boiler went.

I wouldn’t bother
 
Lot of good advice. Are you getting a mortgage or using cash from previous house sale.
Mortgage rates for btl are higher as are set up/ legal costs than those for buying your own house.
I only do commercial property for a reason…seems easier.
Residential net yield is usually 8-10% if you don’t engage an estate agent to run it for you and have incredible good luck with tenants and maintenance
 
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Epping said:
Live rent free and just bung your money in a bank and get 4% return
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The correct answer.

If you are in the higher income tax threshold it’s a waste of time / effort. Hoy it in an ISA / high interest saver and enjoy being home for a while with no stress.

Got a great tennant atm and wouldn’t pull the rug from under them but the second they give notice the place is going on the market.
 
Deckchair said:
The correct answer.

If you are in the higher income tax threshold it’s a waste of time / effort. Hoy it in an ISA / high interest saver and enjoy being home for a while with no stress.

Got a great tennant atm and wouldn’t pull the rug from under them but the second they give notice the place is going on the market.
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I've spent all weekend clearing out a flat Inlet out tenant had been in 10 years.. had very little investment in over 20 years so now expecting it the empty 3 months

It owes me bugger all from when I bought it but still va hassle
 
Epping said:
I've spent all weekend clearing out a flat Inlet out tenant had been in 10 years.. had very little investment in over 20 years so now expecting it the empty 3 months

It owes me bugger all from when I bought it but still va hassle
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I know plenty have made fortunes in equity etc for minimal effort but it’s not for us.

Accidental landlords. 11% management fees plus costs etc. High maintenance tennants will bleed you dry with the slightest of issues. Tax inefficient load of hassle.

The equity from the property properly invested would dwarf the rental income with zero effort.
 
gonzalo said:
I’m going to be moving back up Sunderland this summer, and my plan is to buy a house to let it out when I get home, and live in my Mam’s annex (anar anar shameful but she lives on her own now since me Step Dad died and my brother who lives nearby is useless frankly).

Obviously I’m going to do my research, however I’m aware buying to let is very different to buying ordinarily. Any advice?
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Check your potential yields against potential easy interest. There's never any guarantee of capital appreciation really as house prices up here haven't kept up with overall inflation over the last 15-20 years or so.
 
genewolf said:
A lot of small investors with buy to let's want to get out. There have been a lot of tax changes which make it far more difficult to make money than it used to.

Interest payments are no longer tax deductible. Capital gains no longer gets taper relief and the allowance from this year is only 3k. As above, you'd be better off putting your money in an ISA unless you get an absolute bargain.
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And BTL repossessions are on the rise.

People who saw easy money getting their arses tickled.
 
I wonder when we're going to be due another round of huge house price increases in the north east? The last one was about 20 years ago now.
 

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