Would you quit your job for 1 million quid?

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I see you've deducted 10-15% to cover voids and repairs, too low IMO but still, fair enough. Interest rates rising when they're at an all time low is inevitable eventually, your costs are basically interest (plus your voids/repairs) so once interest rates go up, so do your costs. Then if house prices crash as a result of interest rate rises (wouldn't be a big surprise) then your company is done for.

The best part of your plan is that you're only risking £200k, presuming your loans aren't secured against any of your personal assets.
 
AndrewP said:
You said £400k deposit on 20 houses. That's £20k per house. That would have suggested a purchase price of £80. So you're talking £15k deposit on a £60k house and £5k to do each one up?

No voids, no scumbag DSS tenants knacking your house, no normal repair bills? Or are you factoring this in?
All it takes is an interest rate rise, coupled with a house price crash and the company goes under. At least your personal liability is limited I suppose. Too many eggs in one basket for my liking.
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I have just spelled it out. £60k purchase, 25% LTV mortgage & £5k to do each up

voids etc I've covered as the 10-15% expected loss.

Interest rate rise is mitigated by 5yr fixed rates, but even doubling the rate keeps you in profit, albeit less.

And first time buyer houses in Peterlee didn't loss all that much during the massive house price crash in 2008-2010. They might have lost a bit, say 10%, but that's largely recovered now. And its a long term investment, so not a massive worry.

And you still have 60% of the original capital left.
 
AndrewP said:
I see you've deducted 10-15% to cover voids and repairs, too low IMO but still, fair enough. Interest rates rising when they're at an all time low is inevitable eventually, your costs are basically interest (plus your voids/repairs) so once interest rates go up, so do your costs. Then if house prices crash as a result of interest rate rises (wouldn't be a big surprise) then your company is done for.

The best part of your plan is that you're only risking £200k, presuming your loans aren't secured against any of your personal assets.
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Basically you need more than a million quid to set up that type of business and be comfortable.
 
PTR said:
And first time buyer houses in Peterlee didn't loss all that much during the massive house price crash in 2008-2010. They might have lost a bit, say 10%, but that's largely recovered now. And its a long term investment, so not a massive worry.
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Peterlee was down circa 40% in real terms since 2007 according to the BBC. Loads of first time buyers from 2007 will be in negative equity even now, ten years later, even after 30% cpi inflation.
 
You wouldn’t see me for dust!

£130k to pay off mortgage, £50k on cars and invest in property with the rest, a good few rental properties for steady income and properties to flip quickly.
 
Not a chance. Upgrading to a much better house would cost at least 750k down here. I like working anyway but I work for myself I answer to no wanker boss, just clients I really get on with who need my help. Kicking back and relaxing reckon it'd be 5 mill to buy a load of properties on top to rent out!
 
PTR said:
And first time buyer houses in Peterlee didn't loss all that much during the massive house price crash in 2008-2010
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Tell that to the poor residents of 89, Lancaster Hill, Peterlee, Durham SR8 2EY who bought their lovely home for £84,500 on the 19th Sep 2007 and sold it for £43,000 on the 06th Jul 2017.

Or those who bought 49, Twelfth Street, Peterlee, Durham SR8 4QH for £36,000 on the 02nd Dec 2004 and sold it the other month for £20,000/

Imagine that x 20!!!
 
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AndrewP said:
Peterlee was down circa 40% in real terms since 2007 according to the BBC. Loads of first time buyers from 2007 will be in negative equity even now, ten years later, even after 30% cpi inflation.
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That's the average. If you know where to buy its totally different.
There was a boom on shit houses that collapsed. And a total loss of sales for higher value houses. That's were the headline figure comes from.
There's places where prices have been largely unaffected during the entirety of the "crisis".
 
PTR said:
That's the average. If you know where to buy its totally different.
There was a boom on shit houses that collapsed. And a total loss of sales for higher value houses. That's were the headline figure comes from.
There's places where prices have been largely unaffected during the entirety of the "crisis".
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I thought you said the lower end of the market didn't collapse mate?
 
AndrewP said:
Tell that to the poor residents of 89, Lancaster Hill, Peterlee, Durham SR8 2EY who bought their lovely home for £84,500 on the 19th Sep 2007 and sold it for £43,000 on the 06th Jul 2017.

Or those who bought 49, Twelfth Street, Peterlee, Durham SR8 4QH for £36,000 on the 02nd Dec 2004 and sold it the other month for £20,000/Imagine that x 20!!!
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See, this is where you don't know the area and I do, and how stats are only useful if you understand the market properly.
For example, Twelfth Street isn't even in Peterlee. Its a colliery terrace in Horden.
 
Yes...

Firstly, I'd pay off all debts.
Secondly, make sure my house was the way both my partner (no) and I wanted it.
Thirdly, leave work and have a year off
Lastly, I'd probably go into property development. Which is something I've always wanted to do.

Obviously, I'd ensure my partner (still no) never has to work again. I think she would see her long term future as a lady that lunches.... :lol:

One million pound would change my whole life.
 
PTR said:
See, this is where you don't know the area and I do, and how stats are only useful if you understand the market properly.
For example, Twelfth Street isn't even in Peterlee. Its a colliery terrace in Horden.
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I presumed it was in Easington or Horden actually, but they're classed as Peterlee.

I'm sure there will be people in Peterlee itself equally hit though. Another HUGE thing you haven't considered IMO is a Labour goverment taxing the fuck out of you, or making your assets unsalable due to increased renter rights, or introducing rent controls. Too many eggs in one basket, but it's only 1/5th of the million I suppose.
 
AndrewP said:
I thought you said the lower end of the market didn't collapse mate?
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Horden's colliery housing collapsed for entirely different reasons. It's nationally famous for it.
I'm not going to talk about the other place.

But I will correct my earlier comment. Decent lower-mid end housing in good areas didn't crash. Lower end did in a number of less-desirable places - such as the house I bought in Easington. You live and learn.

AndrewP said:
I'm sure there will be people in Peterlee itself equally hit though.
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In certain places, in certain examples - sure. But cherry picking from sold house prices doesn't give you the full story.
House could have been smashed to pieces
it could have been repossessed and sold at auction etc etc.

Also, there was a mental boom in prices around here the 2 years before the crash too - so its not always a fair comparison - many prices simply went back to what they were 2-3 years beforehand.
 
Of course you would.Then work P/T in a less stressful job.And get another one if that gets too much.

Less stress=longer life.
 
PTR said:
In certain places, in certain examples - sure. But cherry picking from sold house prices doesn't give you the full story.
House could have been smashed to pieces
it could have been repossessed and sold at auction etc etc.
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Obviously this is true, but I don't believe for a second there are parts of Peterlee (of all places) that are immune to a potential house price crash, nor do I believe they were immune last time around.
 
AndrewP said:
I'm sure there will be people in Peterlee itself equally hit though. Another HUGE thing you haven't considered IMO is a Labour goverment taxing the fuck out of you, or making your assets unsalable due to increased renter rights, or introducing rent controls. Too many eggs in one basket, but it's only 1/5th of the million I suppose.
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I had accounted for the tax changes brought in over the last few years (dividend taxes and tax releif on morgage interest). Although I had forgot 2nd home stamp duty.

Yeh, you could diversify a bit more. Its what I'd likely do, though.
 
PTR said:
But I will correct my earlier comment. Decent lower-mid end housing in good areas didn't crash. Lower end did in a number of less-desirable places - such as the house I bought in Easington. You live and learn
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Your fingers would have been well burned there if not for historical low interest rates coming in not long after you bought it. You're right in that certain areas are more risk than others, but you're talking £60k houses in Peterlee, they're either going to be in a pretty poor state, or in a (relatively) pretty poor area surely? You know the area better than me, so genuine question.

PTR said:
I had accounted for the tax changes brought in over the last few years (dividend taxes and tax releif on morgage interest). Although I had forgot 2nd home stamp duty.

Yeh, you could diversify a bit more. Its what I'd likely do, though.
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As you'd do it as a limited company, and you'd only be risking £200k - I guess it would be worth a punt. Biggest single risk to your plan would be a Labour government though IMO, company could be dead overnight one Wednesday midweek.

PTR said:
In certain places, in certain examples - sure. But cherry picking from sold house prices doesn't give you the full story.
House could have been smashed to pieces
it could have been repossessed and sold at auction etc etc.
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How about this place, clearly not wrecked when it was sold, not a repo, in actual Peterlee, not Horden?

http://www.rightmove.co.uk/house-pr...ml?prop=57596605&sale=4934968&country=england

Bought for £88,000 in 2007, sold for £53,700 the other month. That's a canny drop.

Obviously you know the area more than me, presumably it's a bad area, but whereabouts will your £60k houses be, in comparison?
 
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