Buy to let



Frankel said:
If something goes tits up, are you in a position to fix? Or would you benefit from getting an agency to do it for you?

Do you have a tenant lined up?

What sort of deposit do you have? Most banks will only lend up to 80%.
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We renting at the moment and the way the landlords insurance policy works is you had to find the fault yoirself before you fixed it. For instance we had a leak and the insurance company wouldn't touch it till the landlord found where the leak was coming from then there'd fix it
 
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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Just a buy a house and live in it ffs.
Unless your Mam needs you there as a carer.
 
Ciro_DiMarzio said:
Seems daft to keep it now then if you have any equity in it, although if we had kept our first house it would have came in handy for me now.
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I’ve got the option of overpaying on it, which I will, but need a pot of money built up for things going wrong first. I’m not far off that. The tenant is no bother & it’s in a fixed rate, so I’d have to pay to get out now, but selling it is a consideration for when the time is right.
 
Buy and live in a house as close to your Mam as possible. Have the annex ready made up with some things in there in case you need to stay at short notice.
 
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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Another option is to buy the house and ‘rent a room’ out… pay the council tax yourself but get the ‘rent a room’ to pay for all the other bills and pay you rent. Think you can get about £7500 tax free this way.
 
42 said:
Humble brag there?

So if you're a basic rate tax payer, then it's fully tax deductible
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My humble brag is I've been losing money hand over fist on a rental property for a number of years. I'm now trying to sell but my tenant, on council advice, won't leave. So I'm going to get hit for a couple more grand having to have the bloke evicted by a court which I don't particularly want to do. It's brilliant.

I'm an accidental and very bloody unsuccessful landlord. I wouldn't choose to do it in the future.
 
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Why? The returns will be absolute peanuts and you'll be living with your ma.

Just a thought but have you considered buying a property and then living in it yourself?
 
gonzalo said:
From all of this I’m starting to think it’s a bad idea!

Guess, I just need to figure out investing now.
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As others have said. What ever you do, do your research. Work out what the yields are like in the area, maybe the house price rises, likely rent and compare that to your mortgage rate and expected expenses.

Regarding the mortgage interest, you do kind of still get tax relief (via a tax credit), it's just capped at 20%. If you are a higher rate tax payer, the difference is lost.

If you are not going to be hands on then factor in the agency fees as well.

If the property is empty you can claim the council tax and utility bills against profit. And annual losses can be pooled and set against any future profit.

Any major work will likely be capital (unless it's replacing the kitchen or bathroom) and that cannot be claimed in your accounts. It is only relieved when you sell the property as a capital reduction.
 
Longy said:
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
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Same here. Bought my first flat in 2005 and I’m pretty sure it’s still underwater on the original price I paid.

Generally speaking I’ve had no bother with tenants in the 13 years I’ve been renting out but I don’t make any profit on it and the frequent unexpected bills are a nightmare. Just had the waste in the bath go which flooded the bathroom and I’ve got £2.5k to pull out to get it replaced and the bathroom redone. In the past 5 years I’ve had to replace a boiler and a kitchen so probably £7k in total put back into it. When the mortgage is repaid I’m getting shot of it. I make more from crypto and my s&s ISA.
 
I know a landlord from sunderland, does all the graft himself and isnt affraid to get ‘hands on’ 😂 if people take the piss.

Id only get involved if you do the same as sny minor profit will be swallowed by upkeep n other shitty situations.
 
GavFTM said:
Same here. Bought my first flat in 2005 and I’m pretty sure it’s still underwater on the original price I paid.

Generally speaking I’ve had no bother with tenants in the 13 years I’ve been renting out but I don’t make any profit on it and the frequent unexpected bills are a nightmare. Just had the waste in the bath go which flooded the bathroom and I’ve got £2.5k to pull out to get it replaced and the bathroom redone. In the past 5 years I’ve had to replace a boiler and a kitchen so probably £7k in total put back into it. When the mortgage is repaid I’m getting shot of it. I make more from crypto and my s&s ISA.
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Aye, the one thing I didn’t mention in my first post was we bought it for £71k, which what seemed like days before the recession around 2007, might have been 2008. Last time I got revalued for a mortgage they says £65k. It’s a 1 bed cottage in Southwick, so has its own ceiling price & nobody would buy a 1 bed as an investment property, it is what it is.

I know a local letting agent who has said recently cheap properties in traditional cheap areas are starting to break their ceiling for the first time in a long time. How that’s affected my property I don’t know.
 
Longy said:
Aye, the one thing I didn’t mention in my first post was we bought it for £71k, which what seemed like days before the recession around 2007, might have been 2008. Last time I got revalued for a mortgage they says £65k. It’s a 1 bed cottage in Southwick, so has its own ceiling price & nobody would buy a 1 bed as an investment property, it is what it is.

I know a local letting agent who has said recently cheap properties in traditional cheap areas are starting to break their ceiling for the first time in a long time. How that’s affected my property I don’t know.
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Mine was one of those new build apartments that were popular in the early 2000s. I paid £120k for it and I think I’d be very very lucky if I managed to get a £100k for it now, probably more like £90k. Shame as it’s actually one of the better builds in a reasonable area but it’s also got a ceiling so hard to shift it and make the money back. One of life’s lessons not to be hasty with property.
 

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