Discussion in 'Home and Garden' started by easyrider, Mar 18, 2017.
Why dont you have a interest only mortgage ?
It's not exactly the right analogy though, is it? BTL makes up less than 20% of the market and that's predicted to fall significantly with the new government changes. The issue of rising house prices is down to a monumental lack of supply; even if there were no landlords there still wouldn't be enough housing to dramatically decrease house prices. The simple fact is we need to build more. There are also plenty of people who don't want to own property and are quite happy to rent.
I hate to resort to using argumentum ad hominem, but based on some of your previous threads/posts you seem to have a real chip on your shoulder about your circumstances and you don't seem to accept much of the responsibility.
You're earning about the average income for Cornwall with relatively few qualifications; you're applying for new jobs with (presumably) better pay; you must have around £65k in savings (based on your comments in the 'Are earnings too low / living costs getting too high?' thread) and you don't have any major debt. You're in a significantly better position to get on the housing ladder than a lot of people. Admitedly you'd find it easier to get a mortgage if you had a second income from a partner or spouse, but even by yourself it's not impossible — you could find someone else in a similar position to yourself and combine forces to house or flat share, or you could use a Help to Buy Equity Loan. A friend of mine recently bought one of the new developments at Grampound Road and he was in a similar position to you without a second income.
But no, it's much easier to blame BTL landlords for some perceived moral crime and make more excuses as to why you can't get a house.
If it's cornwall, it's not BTL, more people in london buying seasonal homes that they use as holiday places and make some cash during the tourist season. The gap between London and the rest of the country is getting ever wider, especially in the smaller coastal towns. I'd be eating my hat too if some smugs from richsville holiday in my village twice a year and use it as a holiday let, and meanwhile price out the locals who live there through the winter months when none of the London set will be seen.
Very true, I grew up in one of those Cornish coastal towns, but it's not the second-home Londoners that seem to be drawing FoxEye's ire…
Got a loan from family at 5%, bought a decent sized house which was being let out to local students and continued letting it out to students.
Rent is about 10% of the value of the property. It's paying off the loan with enough left over to run the place. Bills, repairs, furniture, agent, cleaning, certificates, licence etc.
I guess I also have a spot booked in hell for doing this
I'm getting long in the tooth and short on hair! There is a system, it isn't hard to learn, and yet those playing this game will get ahead, far more than fair-minded people, they play the system. I got my A levels, I went to uni, I got a degree a B med sci btw, I left with about 10k of debt, I went and worked a bit, I was with my woman, also graduate teacher science secondary.. we wanted to leave renting and buy.. at the time £400 a month for 2 bed terrace, we looked about, all we could find were people selling who left school with little or no gcses, had kids etc, but they were selling to us.. talk about irate.. we'd both played the governments game to get in debt and find this? Fuming is not the word.. there are plenty of instances where you really feel like crying. Fox would do well to use his obvious intelligence to play the game.. I'm playing the game, a game I intend to win, it's pointless crying about it, it isn't going to change, you need to get your head into it, (not fun I know) and use sense.
If you have no kids or dependents, then I'd advise leaving and getting where the money/jobs are, once you are shackled, and it's the women and their networks rather than the kids, you are screwed. If you are single, and a bloke, have a reasonable mentality and can take the challenge, get down south and get earning good, within 5 years you can return as boss in your local area, also with a good wadge of cash or properties back in the hometown. No woman? They will flock when you have loads of cash.. Play the game, if you understand the rules, it does make it much easier.
That's ok, your spot is behind me But look on the bright side, margaritas in retirement !
Do it if you can it will probably be the best decision you ever make financially!
Just remember it is a long term gain and everything is a risk.
Risks can pay off or you can end up worse off. No doubt that property is the best investment right now.
lol at the hate.
Anyway I was thinking of doing the same but buying a house or two that are sub £40k so you avoid the SDLT.
Can you do this with any Ltd company, such as one registered as an IT services company/PSC?
I wish we had an enabled like system on here.
Same as permies on my first contract who bitched at me for earning £xxx per day and they were on £22k a year. I said repeatedly to them just walk out and go contracting if you care so much, until you do that keep stump. It took two of them about a year but they've been ever thankful to me since then for telling them to stop crying about something and do something about it.
If a bank will give it the mortgage, I don't see why not.
I think I need to ask my accountant about this, as I have enough for a deposit in savings.
Mortgages are easy on BTL. Just need rent to be 125% of mortgage interest at 4% or 5% (depending on term usually).
What deposit are you looking at for a BTL?
I have just bought a terrace house with a mortgage of £420 a month on a 2 year fix. planning on overpaying to £500. Im hoping by the end of the 2 years to have about 30k saved, poss more.
i would be looking at buying another property to move into and rent the terrace house, to cover the bills really so i have it paid off at the end.
Is it a feasable thing for me to do?
It's dependant on so many variables, abstract as 'are you self-employed?', to does your partner work etc etc. Everyone is different, we all have different pressures and incomes from a huge variety of sources. In reality you have to get out the calculator, work out all your expenses, can even stick in contingency couple of grand for whatever happens etc, then work out the cost on the house etc. Lots of people don't factor in the upkeep of the rental, however this is pretty silly, little and often keeps the place nice and ticking over, without massive shocks around the corner. You'll have a host of other stuff too, like landlord insurance etc. There is a huge amount to get straight in your head before you go diving in..
For all the haters dissing Buy to Let as making property more expensive I would bear in mind that private renting has always been around, but it feels like 'BTL' has only become a phrase you see widely used in the past 15 years or so gets more focus. Arguably it is Buy to Leave that should be attracting more flak in principle given that it effectively removes the available accommodation, although of course it is a smaller segment of the market so less impactful.
If it weren't for the recent tax changes I would consider it myself, hindsight is a wonderful thing but looking back now I wish I had bought a 2 bed flat in London once I started working here, to use as a pied-a-terre with additional rental income to cover the mortgage.
Though I guess it would no longer be classed as a PSC. Bummer
No, this is well worth a read for those who are convinced property is a one way street to riches: http://www.greaterfool.ca/2014/12/28/think-rich/
Mortgages on BTL were easy, used to be that... now generally 145% at 5% and a 35% deposit.
The rules changed recently as a result of the tax changes. there will be exceptions, but that is the general rule now.
Will speak to the accountant once work settles down.
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