The joy of being a landlord
- Thread starter Quartz
- Start date
Deleted User 298457
Deleted User 298457
Were you born with poor taste Kindai or did you just follow the landlords playbook precisely?
Its up at £625 p/m which for the area is at the high end of what it could command, however given how much interest is already there, could potentially get a little more. But the flat itself was only £60k plus £7.5k in work.
Thanks, a lot of hard graft, a lot of deep cleaning, and long days, most of it just making the place suitable for trades to come in and do their work (electrical, plumbing, kitchen fitters) and the rest was just taking it a room at a time and dealing with what was found.
A few mistakes were made along the way but as its only my second BTL, happy to be learning them early on, it cost me ~£3k in those "lessons" so next time I know what to do and how to handle them.
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Bloody hell, that's a decent return on investment.
I'm thinking of another rental, but I doubt I could match that.
Nice work
Bloody hell, that's a decent return on investment.
I'm thinking of another rental, but I doubt I could match that.
Nice work
Got the house at a significantly reduced price because the agent didnt show up to the block booking viewing.
Everyone else left and managed to talk the agent into giving me the keysafe code, let myself in had a nosey around and was the only person to stick an offer in!
@kindai clearly didn't get the note that BTL is a sure-fire way to lose money, and the poor, poor landlords are selling up in droves because they can't make ends meet...
Unless, that is, the people who said that were fibbing. Perish the thought.
Unless, that is, the people who said that were fibbing. Perish the thought.
But you might have to take a pay cut to move to an affordable area, or you might not be able to find work there at all. Making "affordable" entirely dependent on how you make your living in the first place.
Landlords can buy (additional) property in any part of the country without worrying about what the local job market (for their profession) is like. Working people who want to buy their first house don't have that luxury, now, do they?
Deleted User 298457
Deleted User 298457
One less on the market for good tho, now.
BTL can work in certain areas, also it depends on circumstances.
For instance if you have a 9 to 5 job earning around the 40% tax threshold and then you buy a BTL, they will tax the turnover at 40%. You can't put mortgage interest as an expense anymore either along with a host of other limitations exclusive only to BTL.
So if you pay £700 per month for a 2 bed and renting it out for £1000 per month:
Total across 12 months
Mortgage: £8400
Rental income: £12000
Tax: £4800
Leaves you with £7200, BUT your mortgage is £8400
Profit: -£1200
If you want to make it work with the current interest rates then you either have to charge ridiculous rental rates which is not fair for tenants or do it under a limited company.
For instance if you have a 9 to 5 job earning around the 40% tax threshold and then you buy a BTL, they will tax the turnover at 40%. You can't put mortgage interest as an expense anymore either along with a host of other limitations exclusive only to BTL.
So if you pay £700 per month for a 2 bed and renting it out for £1000 per month:
Total across 12 months
Mortgage: £8400
Rental income: £12000
Tax: £4800
Leaves you with £7200, BUT your mortgage is £8400
Profit: -£1200
If you want to make it work with the current interest rates then you either have to charge ridiculous rental rates which is not fair for tenants or do it under a limited company.
Sacrifice is required to get what you want in life.
I commuted ~200miles a day for a few years until I bought a house a mile from my office.
One more on the rental market "tho".
Deleted User 298457
Deleted User 298457
Just because you own a keyring doesn't mean you are part of the owners club
Soldato
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Not quite right , you get a 20% tax credit on the interest . Absolute peanuts compared to 100% tax relief pre 2017 , anyone with spare cash was bonkers not to get a few renters.
Thats really not a good profit for that investment, a few percentage point changes and you’re running at a loss. Jeeze I’ve had more profit than that this year from my isa and bonds and that’s only 30k invested . You’ve not included service charge , ground rent , boiler maintenance, running repairs either.
Not sure of your purchase price there but you really want to be looking at an 8% yield on your investment or just don’t bother.
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Deleted User 298457
Deleted User 298457
*OUTRAGE ONLY APPLICABLE IF YOU EXCLUDE ENORMOUS EQUITY GROWTH
Doesn't really matter given there is a shortage in general across rentals and properties for sale and council accommodation. One less available to buy but one more is available to rent so meh...
@kindai has added value by improving the property and turning it into a nice place for someone to live. Ditto to the Tiktok landlord who was getting dunked on on social media recently, he actually buys up properties and fully renovates them to a good spec then rents them out as individually let studio flats with some shared facilities... that's kinda needed, there is a demand for that and in that case, it's adding more bedrooms to the market/creating more "homes" (for people who only want a small studio/can't buy a house) as he converts the living rooms too.
The issue with UK housing is a supply issue.
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Yeah, that looks promising, especially given current interest rates:
So... what equity growth? Most BTL mortgages are interest only too. You'd need quite a hefty yield if you're a high earner as someone already pointed out given the changes to mortgage interest tax relief.
Deleted User 298457
Deleted User 298457
You think BTL landlords are cashing out on their equity "the following month"? :S