Oh i see, i most likely wont bother offering furnished if i decide to rent it out then, ill take my toys with me
Getting into buy to let property business
- Thread starter salami1212
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Oh i see, i most likely wont bother offering furnished if i decide to rent it out then, ill take my toys with me
![[TW]Fox](/data/man-of-honor/2009.png){kind=avatar}
Why would the break even point on a buy to let financed with a mortgage be the entire value of the property
You've not paid £200k for it, you've paid say £50k and the bank has paid £150k. The rental income then funds the mortgage, so the break even point is when the profit from the rental income has recouped the deposit not the entire cost?
Soldato
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[TW]Fox;22476853 said:Why would the break even point on a buy to let financed with a mortgage be the entire value of the property
You've not paid £200k for it, you've paid say £50k and the bank has paid £150k. The rental income then funds the mortgage, so the break even point is when the profit from the rental income has recouped the deposit not the entire cost?
The bank aren't going to let you off that interest, you still have to pay it. It's not like once you've recouped the 150k you can turn around and tell the bank you aren't paying them any more money.
Area is south Oxfordshire and Berkshire for me personally.
Buy carefully, skill up on all trades yourself and expect to do a lot of hard work to renovate the place. Despite the doom-mongers on this forum there is still a hell of a lot of value add all over the place if you are not workshy. Many people make more than a good living this way without ever going down the rental path at all.
Whether you then sell or present this to the rental market is then up to you. The key is that you can make the figures work if you put the work in, as demonstrated by the example i used above about that recent flat purchase. At first glance it looks fantastic, but actually you realise that it is a perfectly realistic and serially repeatable set of figures.
Edit: Another quick example, a 3 bed semi detached family house in south oxfordshire (which i recently sold actually). Bought at £142k from Natwest bank. Reposession, completely trashed, gardens 6 foot high with weeds, no hardstanding for vehicles, massively in arrears i understand). It achieved £950pcm once renovated internally and externally. Upon (immaculately presented to a young couple) sale i made a healthy profit, too, if in the case of estebanrey you cannot see past a year ahead
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The main issue with buy to let is the extra work, if you get difficult tennants it's a ****ing nightmare.
Buy, rennovate, sell is the way forward. It's about the right houses, the right market and avoiding cowboys and "jack of all trades" builders.
Thats what I'm going into, as soon as I've got my deposit I won't be buying a nice house, run down and plenty of profit potential is the way forward.
Buy, rennovate, sell is the way forward. It's about the right houses, the right market and avoiding cowboys and "jack of all trades" builders.
Thats what I'm going into, as soon as I've got my deposit I won't be buying a nice house, run down and plenty of profit potential is the way forward.
because house prices can go up and down (and yes, if you bought a new build you'd be in negative equity from day 1 as they tend to be sold at a premium/overvalued).... why should a bank take on that much risk and essentially give everyone a free roll on buying a very expensive asset...
there's no free lunch here, if you want a reasonable mortgage rate you need to stump up a deposit else you're expecting the banks to take on way to much risk and we've already seen what happens there..
aside from the fact that you couldn't slash prices in half it would matter to a lot of people... you don't think the young couple in the 1 bedroom flat who want to start a family might want to move elsewhere?
suppose they had 25% equity in their 200k property... now they've got a 150k mortgage on a 100k property and can't afford to move elsewhere
Soldato
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Well you could just introduce maximum prices, they seem to be able to do similar things in other markets.
Obviously part of revaluing every house in the country would also include re-writing mortgage deals as well.
Look at this way, my parents bought the first house I can remember living in in 1984 for 30k, they sold it in 2005 for £250k, even taking inflation into account that is a silly rise. In their day buying house was relatively easy for anyone on average wage but now it's impossible for a lot of people. We've gone from mortgages being 3 or 4 times your wage to 10-15 times, it's just silly.
I'm renting atm and my only hope, excluding a lottery win, of getting on the property ladder is waiting until my parents die and getting half their house (my sister would get other half) and that shouldn't really be the case.
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Why don't you stop trashing an otherwise informative and decent thread with complete rubbish?
Introduce maximum house prices? What impact do you think that would have on the UK's cash flow!?
Lets try not to feed the troll
Soldato
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BTL, one of the only businesses where competition increases the price of a product. Thus pricing people like me out of the market. With a wife and child to support I'd like to offer my thanks for making it more difficult for me to buy.
Soldato
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Oh OK screw the citizens and their ability to buy affordable housing because it might not look as good on UK PLC's spreadsheet.
We shouldn't have an economy so heavily reliant on 'financial services' anyway.
Answer me this, why when my parents bought their house in 84 for 30k why that was 'worse' then when they moved in 2005 and had to spend 230k on a smaller house?
It's a case of 'I'm alright Jack' for people who currently own homes or are lucky enough to inherited property, but what about the rest of the population?
The competition for BTL is surely the volume of investors that want to purchase a property - i.e. greater demand raiding the prices. Doesn't seem that alien to me.
You make it sound like the UK PLC spreadsheet doesn't impact you. If there is a massive deficit introduced by some idiotic idea of capping house prices, where will the extra cash come from? Magic?
Soldato
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The only people who would lose out would be the banks, and they've made far and enough money from mortgages over the years anyway.
You didn't answer my question as to why the market in the early 80s when normal people could afford housing was so bad for the UK.
You spelt 'altered that so it's complete nonsense' wrong.
Capitalism, isnt it just so unfair?
Lets all have a big whinge as that is how you get ahead in life.