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chickpea

new to all this - hello!...and help, please.

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In a nutshell -

Husband and I have inherited £155k.

We are both self-employed, with 2 young children and are looking to invest upto £125k (including contingency funds).

We aren't looking at BTL's as an alternative to stocks and shares (neither of us feel we know anything about the stock market), nor are we looking at BTL's as a way of making a fortune - really, I guess we're looking at them as an alternative to sticking the money in the bank.

So...any properties we take on simply have to pay their way, with maybe some capital growth in 10+ years (thinking about when our eldest child would go to university).

We have 3 properties in mind. All are on interest-only mortgages at 4.65% on 65% LTV

A, 2 bed semi, needs no work at all.

Value - £124,950

Potential rental - £525

mortgage monthly payments - £314.72

B 1 bed new apartment

Value - £83K

Potential rental - £475

monthly mortgage payments - £209.06

(ground rent + maintenance fees = £930 pa)

C 2 bed semi, needs no work at all

value - £120K

potential rent - £500-525

monthly mortgage payments - £302.25

We would be using a letting agent at 10% + vat fees.

My questions are:

what sort of contingency fund should we allow for each property?

Are flats a dead-loss, with regards maintenance charges and ground rent? Or are they a good investment because they are th first step on the property ladder for a lot of people? From quick calculations, I don't think we're going to make much in the way of propfit through rent but could capital growth make it worthwhile - or should we just forget the apartment??

Is it enough in today's market to make a small profit on rent and hope for capital growth, or are we making the biggest ,most obvious mistake all new BTL'ers make???

As I said at the beginning, we're not really looking to make huge wealth (though that would be lovely!) - we are really wanting properties that pay for thmselves and maybe make a small capital growth over 10+ years.

Please feel free to tell us to forget it and out our money elsewhere, if it looks like we ar barking up the wrong tre with the above property examples!!

(just to add - we've done our research on the location and demand for the above properties, so it comes down to the maths by the look of things).

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I'm sure there will be loads of advice forthcoming.

The most common comment will be to read up on the industry and your responsibilities.

I would suggest doing a lot of reading of forums to see how LL's have had problems.

Some LL's have issues due to there own naive approach, some because legislation is designed to protect T's and not LL's. In other words the odds are weighted in favour of the T.

Don't believe an Agent relieves you of legal responsibility, research your Agent.

I would guess that this is your one big chance in this life, please consider the possible negatives carefully before taking the plunge.

Your figures are unusually optimistic for today, although to be honest I haven't calculated feasible BTL profits for comparison for some time.

Contingency, well if all goes well you 'may' not need any. If you are unlucky you need to consider the effect of 8 - 12 months no rent, cost of repossession and at refurb at eventual repossession. No need to consider the stress if you can handle these things well.

My cynical view is that as we are fast becoming social LL's I wouldn't invest in the industry until the legislators wake up to our importance as housing suppliers.

Over to the others, they may be more positive for you.

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I'm sure there will be loads of advice forthcoming.

The most common comment will be to read up on the industry and your responsibilities.

I would suggest doing a lot of reading of forums to see how LL's have had problems.

Some LL's have issues due to there own naive approach, some because legislation is designed to protect T's and not LL's. In other words the odds are weighted in favour of the T.

Don't believe an Agent relieves you of legal responsibility, research your Agent.

I would guess that this is your one big chance in this life, please consider the possible negatives carefully before taking the plunge.

Your figures are unusually optimistic for today, although to be honest I haven't calculated feasible BTL profits for comparison for some time.

Contingency, well if all goes well you 'may' not need any. If you are unlucky you need to consider the effect of 8 - 12 months no rent, cost of repossession and at refurb at eventual repossession. No need to consider the stress if you can handle these things well.

My cynical view is that as we are fast becoming social LL's I wouldn't invest in the industry until the legislators wake up to our importance as housing suppliers.

Over to the others, they may be more positive for you.

Thanks for your honest reply.

When you say my figures are optimistic, I'm not sure what you mean? The house prices I've quoted are actual figures for houses we've viewed - prices that the vendors will accept. Are you saying they are too expensive?

The rental figures are what like-for-like properties are actually renting for here currently.

The mortgage payment figures and rates are what we were given by a financial advisor on Monday.

My main concern is that I've done some calculations, based on 10 month per year occupancy, and the profits (before insurance, gas checks, EPC etc) are less than £1000 per property. Obviously, if interest rates rise after our fixed rate period of 2 years, these figures reduce even lower...is it even worth considering BTL's on these terms???

It's suddenlyl become VERY apparent to us that yield and profit are 2 very different things...but should we be overly-alarmed by the lack of profit, if the properties have good potential for capital growth?

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Prior to the boom most / many BTL investors were setting up a pension plan. I was since 1997.

During the boom (till 2008) many saw a fast buck situation, many are now caught out.

The trend for the pension plan (long term consideration) is returning. Nothing wrong with either, it's not greedy to make money if we can.

You have allowed for 2 month a year voids. That would be my style, to over state (over calc) the negative and understate the positive (within reason). If it still looks feasible hopefully then you have a bonus to look forward to.

A 2 month void is very feasible, but if bought wisely and operated efficiently should not be so pessimistic.

To allow in your calc (Richlist is good at adding to such a list as this).

Arrangement fees (much higher these days),

survey/s,

legals,

pre rental works,

property BTL insurance,

rent guarantee insurance (if desired),

accountancy fees (if needed),

EPC,

Gas cert,

Electrical inspection (not a legal requirement but you are responsible if an installation is deemed unsafe after an event and may affect insurance),

possibly more but good for initial feasibility consideration.

My reason for believing that your figures were optimistic is that many ignore the cost effect of the above and also a deposit required. You are providing a 35% deposit, in the future the interest on this may have increased benefit for you.

Your simple figure of rent - mortgage payments is a common calc, but is not a true picture of the whole investment, or as you have recognised the situation as might be when interest rates rise.

For a few years I have been keen to ditch my portfolio, largely because I feel great risk from the ever increasing legislation and over consideration to the poor poor T's. As we are now closer to a time when property values are 'likely' to show increases again (tis all gambling) I am seriously considering hanging on for a short while longer to hopefully enjoy some of the benefit.

I don't know your attitude toward this investment consideration but I have seen many who go in with the view that owning properties, even having control over T's lives, gives them a superior status. Soon enough they realise there is little pleasure and it becomes just business.

I hope this business will allow for retirement to a warmer, easier place. The sooner the better.

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That's my point - even WITHOUT taking into consideration all of the of costs you've given (but which I am fully aware have to be calculated), those 3 properties are giving a "profit" per year of less than £1k - to me, that doesn't seem worth the risk, does it?

My next question, then, is this -

Would we be even more stupid to buy one of the properties outright, thereby cutting mortgage payments and arrangement fees (although the mortgage we're looking at only has a fee of £250 and includes a survey) and not having to worry about vacant periods? I'm pretty sure we'd be under tax allowance too, so tax issues wouldn't be a big consideration.

(my head is spinning from all the considerations and possibilities - we started from the position of buying the first house outright, but it was a mortgage advisor who suggested now was a good time to start a portfolio

...and we shouldn't take any notice of the news...)

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Of course your 'advisor' won't have greater benefit from your taking mortgages cool.gif.

The £250 including survey for a BTL, wow things have improved dramatically.

It isn't for others to decide your path and therefore the risk you take, it isn't their risk.

No mortgage, increased control, can mortgage later if you like the business and wish to expand, less risk from interest rate rises.

Property prices may rise fast, I wish, and you lose out on equity gains.

News, well if they stuck to facts it would be but let's face it they dramatise the information to sell their product. Cut the tosh away and the facts may have value to us.

Don't worry about tax, the more tax you pay the more money you've made.

But there are ways to increase your tax efficiency.

While considering don't always assume that the increased 'estimated' profit makes the venture more desirable.

For example you've considered flats, mine generate more profit but come with greater headaches than a stable family situation (and they are difficult to find).

Just for smiles.

Husband lives in flat 1 has for 2 years,

wife lives in flat 3 has for 8 months.

They argue and not discretely.

I return from holiday to find he posted his notice on the 11th and rescinded it on the 13th, they've fallen out again.

Time to inspect, today he has cancelled both inspections programmed for tomorrow, and can't make Friday. He has cancelled on her behalf previously,

She is unmanageable, he was fine when she lived 5 miles away.

I am going to serve notice on the lady, I'll bet then she will accommodate an inspection, any 'wear an tear' I expect payment as she will hope I won't go for repossession. She's going anyway.

Respectable lady took flat 4, turned to the bottle, slept on the grass at the front when her legs couldn't get her home, fell down the stairs (they must have moved). Couldn't decide wether to curse people or love them. Accused the girl (28) of flat 6 of having sex on the staircase in January (-5 deg) and causing the sofa in her flat to move (tother side of a 2 skin brick wall).

After receiving sloppy cheeks (she decided I was lovable, I am of course- but choosy) I wouldn't chance being alone with her. She's moved, probably closer to the Off Licence, phew.

Just a couple of the easy stories, such like as 2 guys accompanying an ex T to get his deposit from me,

travelling 160 miles (round trip) to sort BF kicking in fr door to get to T inside and on and on, not so smiley.

Character building though.

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COR summed it up nicely........

"My cynical view is that as we are fast becoming social LL's I wouldn't invest in the industry until the legislators wake up to our importance as housing suppliers".

Which is why I don't do DSS! :D

How can you advise someone not to do it? If that had been thrown at me back in '89 would I have carried on doing it? probably yes. :D

The major problem today Tracey is that everything is stacked against the honest Landlord by the Courts and until there are a few more solid laws favouring the good landlord rather than the dishonest tenant I would certainly consider carefully before entering the minefield of landlording properties as a Newbie.

It's a risk but anything business wise is a risk so do it and see how you get on.

I would always go for the 2 bed semi rather than flats/apartments.....easier to manage imo.

If it makes you feel any better I too inherited some money last year and I went out and bought a tenanted property (on the highest recommendation I might add)rather then have a wedge sitting in the bank earning tiddly-squat in interest for me.

I like to think I know what I am doing but of course it's all a gamble isn't it as in life itself? :D

Mel.

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Here's my checklist......

Updated 11th Jan 2011

1. Get References.....bank, employer and previous landlord.

2. Take out rent guarantee insurance.....it’s not expensive.

3. Get a home owning guarantor. Carry out reference checks on the guarantor. Give the guarantor a copy of the AST. Make sure the guarantor document is drawn up as a deed.

4. Don't let to people with pets or children......the risk of them giving you problems are big.

5. Don’t let to anyone under 18 (minors). Draw up your own limits….I prefer nobody under 25.

6. Don't let to smokers........you won't get rid of the smell.

7. Don’t do Company lets.

8. Don’t let to anyone on Housing Benefits.

8a. If you do choose to let to applicants on Housing Benefit CHECK that your mortgage & freeholder (if your property is leasehold) allows it.

9. Don't let to anyone who isn't working full time.

10. Inspect properties every 3 months.

11. Only let initially on a 6 month AST.....that way you can both part company after 6 months if you don't get on.

12. Use a reputable Lettings Agent OR one who has been recommended OR do it yourself (only if you know what to do).

13. Meet your tenants personally. Make sure you ask all the right questions and gauge whether they are right for you.

14. Protect the deposit in one of the official schemes.

14a. If you have a dispute with your tenant(s) over deductions from the deposit remember…..you can either go through the DPS adjudication process OR take the tenant to the Small Claims Court for recovery of your losses where you may have a better chance of success.

15. Issue a section 21 notice as soon as the deposit has been protected.

16. Make sure there is a detailed inventory & schedule of condition……signed by both parties.

17. Remember its a business....so avoid emotion & being overly sympathetic to your tenants.

18. Read as much as you can about renting & letting i.e. educate yourself.

19. Don’t let to anyone who doesn’t speak or understand English.

20. Don’t forget that you will need an Energy Performance Certificate (EPC)…….before you market the property.

21. Don’t forget to get an annual Gas Certificate.

22. You are responsible for ensuring anything electrical in the property is safe so consider getting the electrics checked professionally….and any appliances you provide.

23. Try to avoid having your property classified as an HMO……meeting regulations is expensive and time consuming.

24. Make sure all adults living at the property are on the AST & any other documents.

25. Minimize your income tax liability by claiming all the expenses you are entitled to…..most people don’t and therefore pay more tax than they should.

26. If one of the owners is a higher rate tax payer consider splitting the beneficial income other than 50:50 to take advantage of the lower tax payer rate.

27. Keep all capital expenditure receipts/ invoices to minimize CGT liability on disposal.

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Was it the same agent that is selling the property that gave the rental valuation? If so I would take it with a pinch of salt and ask the advise of at least two other letting agents for a balanced view. Also you can ask the letting agents if any of their landlords are selling any properties with tenants in situe.

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Wow! Great information...and loads to think about. Thank you all very much for your replies.:)

I'm swiftly going off the idea of the apartment, and Cor's tales have just about finished it for me lol!

:blink:

No, it wasn't the same agents that are selling the properties that gave us the rental potential figures - so I guess that's positive. (clutching at straws here!).

No, we had already decided no DSS/smokers/pets etc - although the sort of properties we're looking at, I'm thinking may attract young couples with a baby/small child. (newish estate houses, close to local primary schools, walkable to local shops and station, very close to the M4...so also young professionals).

I know no-one can predict the sorts of problems we might have with tenants, nor house price rises or interest rate rises etc - but is it even worth considering BTL's that run at less than £1k a year each?

Is it enough that, all thing being equal, they pay for themselves and we can hope to make on capital growth - or is that a very poor starting position, and are we setting ourselves up for a very expensive fall?

Looking at the 3 properties listed, what is our best gamble - buy one outright, buy 2 on a mortgage (as detailed)....or step away from all of them and put our cash somewhere at least where it won't cost us anything???:unsure: Is there ANY point us taking the potential risk for such apparently small annual profits? - in other words, is there a basic starting position, below which any potential LL should not go????

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Some people here already know that I hold quite a negative view about buying investment property at the moment.

* The market is at best static and in many areas prices are still falling. This situation is unlikely to change any time soon.

* Mortgages are expensive. As bank base rate is only 0.5% mortgages can only go up.

* Mortgages for BTL's generally already have high interest rates, large arrangement fees and onerous terms & conditions.

If you invested the £155,000 you should be able to get 3% after tax.......thats £4650 pa and should be your starting point.

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Some people here already know that I hold quite a negative view about buying investment property at the moment.

* The market is at best static and in many areas prices are still falling. This situation is unlikely to change any time soon.

It's Groundhog Day again and back to 1990.

The only way to make real money is to buy run-down properties in a good area as I did back then. Renovate....and let out. But never, but never, overpay for the property that needs work as labour rates etc. around my part of the World are still quite high but I do most of the work myself as I am a tradesman and my Son runs a Plumbing & Heating Company.

Sit back and wait.....property is a long time asset to rise in value and in my case it was around 10 years to year 2000.

Property will rise again in price......but not for 3 to 5 years and in the meantime you will be receiving rent from that investment.

In Tracy's case I would not rush into buying just yet but to keep the money in the bank and receive the interest but at the same time keep looking for a property.....as indeed I do all the time.

Mel.

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Tracey, I think you are doing absolutely the right thing by doing research first! You have clearly considered the different options and pit falls.

I'm a newbie to this business with just one BTL flat but as you have calculated, you have to think whether the slim profits are actually worth the day to day headache of managing property (or shall say tenants!).

BTL mortgages are hugely expensive - they often have sky high arrangement fees, £5k plus!!! Doesn't that make your eyes water??? Equally, the tenancy set up fees are expensive too (if done via a Lettings Agent) and can quickly eat away any profit that you had hoped to make, if your tenants decide to leave at 6 months point. And don't forget that you'll be responsible for the bills whilst the property is empty.... the list goes on....

The property prices at the moment are stable, you don't lose anything by waiting and seeing which way the market goes.

As for the choice of property, from lettings point of view, I think 1 beds are probably quicker to let, but with houses you are in more control of the maintenance and don't have to deal with the managing agents (and pay service charges for their services!). Have a word with your local estate agents to see what type of property is in demand in your area.

Or how about upgrading your current family home instead? When you eventually downsize you won't need to pay capital gains tax either….. Good luck and let us know what you decide!

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Lots of good advice already ..... so I will keep my comments brief.

Never buy flats ..... far too many investors are chasing far too few tenants in this sector ... and have had their figures burnt with long void periods, negative equity and high maintenance charges.

2 bedroom houses with equal sized bedrooms (if possible) is the best opt in IMO.

Being a landlord is a long term - 10 to 15 year- investment. If each property is creating an annual profit of about £1000 and you expect property prices to double in the next 15 years then you will achieve an income of £15,000 and capital growth of £125,000 on each of the 2 bed properties. Sounds good to me.

Good luck,

Mark

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Being a landlord is a long term - 10 to 15 year- investment. If each property is creating an annual profit of about £1000 and you expect property prices to double in the next 15 years then you will achieve an income of £15,000 and capital growth of £125,000 on each of the 2 bed properties. Sounds good to me.

BUT there are lots of unknowns over 15 years.......interest rates, property prices, the market, the economy etc etc. Less taxes, less unexpected expenditure, less capital gains @40%.......dont forget the work, the stress and the risks

Alternatively £155,000 investment compounded with less risk, less work & less tax is.....

3% = £241K

4% = £279K

5% = £322K

6% = £371K

7% = £427K

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One things clear, from all the great advice here - the only thing certain as a BTL LL is...uncertainty lol!

We're 99% sure now that the flat is out the window, not only from what's been said here but from reading that new-build apartments and flats have historically been quicker to lose value than any other sort of property. I am concerned that the maintenance charges will only increase and any sort of "problem" behaviour from our tenants will have the company complaining to us. Also, the restrictions on what we can and cant do put me off - you can't put laminate or wooden floors down, or ceramic tiles, for eg.

I'm leaning strongly towards either buying the first property outright (hence doing away with the associated risks of having a mortgage PLUS if we find we HATE bing LLK's, we can always leave the property unoccupied without having to pay the bank every month) - or buying both 2 beds.

Yet another question - I have found out from the sold house price lists on Rightmove that the second 2 bed property was last sold in the latter part of 2008 for £113k. It's now on at £125k but likely to go for £120k...is a growth of £7k in the last 2.5 years a positive sign that it's a property that *should* fair reasonably well in a price dip? We have been told that this area hasn't suffered anywhere near as badly as the national house prices (I think we were told it was down 8%).

Is it a positive thing that plans have recently been rolled out for a brand new retail outlet and cinema complex to be built a couple of miles away - do all of these things work positively for property investment?

We're off to see a financial adviser tomorrow, with the facts and figures we've calculated on each property (however, he works within an estate agents, so I assume he's really a mortgage adviser, so we're also going to see a recommended independent one).

I have to say...having no money has always been stressful, but having SOME is equally worrying!!!!!

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We're 99% sure now that the flat is out the window, not only from what's been said here but from reading that new-build apartments and flats have historically been quicker to lose value than any other sort of property. I am concerned that the maintenance charges will only increase and any sort of "problem" behaviour from our tenants will have the company complaining to us. Also, the restrictions on what we can and cant do put me off - you can't put laminate or wooden floors down, or ceramic tiles, for eg.

Flats generally are OK provided you purchase them at the right price.....but that of course applies to anything. In my experience maintenance charges don't increase at a faster rate than other expenses. You should aim to let to tenants who don't create problems......I seem to have managed it for over 10 years so I'm sure you can to. There are very few problems that will result in the management company complaining to you. Restrictions are there for good reasons. They are there to ensure that everyone else is able to enjoy living in the building without being continually distrubed. Laminate is not the best floor covering for rental property. Damage is virtually impossible to repair, costs more to install and unless you buy expensive product its life expectancy is no longer than cheaper alternatives.

I'm leaning strongly towards either buying the first property outright (hence doing away with the associated risks of having a mortgage PLUS if we find we HATE bing LLK's, we can always leave the property unoccupied without having to pay the bank every month) - or buying both 2 beds.

No mortgage usually means more tax to pay.

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An advisor is in the business of making money by his client taking on as he advises so do read between the lines when being 'advised'.

Some years ago I was advised that I must invest 15% of my salary for any hope of a reasonable future pension. He was visibly upset when I described an alternative with more chance.

Both ways have proved to be less than reliable and neither of us had a crystal ball. I took my chance with BTL, he didn't get his commission.

The new businesses cold be a good source of T's, too close could mean late night problems ??

Some areas have risen in value during this 'dip' ours has but all our portfolio has been devastated.

A £7K increase must mean some good improvements to the property in that time.

I would tend to think rather than this being a positive sign that you are paying some ones profit, nowt wrong with that if it represents value.

A good point made earlier about flats has likely answered one of my questions.

When we bought the flats in 2000 renting was a doddle, nowadays the voids are getting longer. I am more fussy (experienced) and don't re-beautify them between each let, but the view that there are just too many properties developed for the single is a good one. Toooooo much competition. Cheers buddy this may help in any selling decision.wink.gif

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We're 99% sure now that the flat is out the window, not only from what's been said here but from reading that new-build apartments and flats have historically been quicker to lose value than any other sort of property. I am concerned that the maintenance charges will only increase and any sort of "problem" behaviour from our tenants will have the company complaining to us. Also, the restrictions on what we can and cant do put me off - you can't put laminate or wooden floors down, or ceramic tiles, for eg.

Flats generally are OK provided you purchase them at the right price.....but that of course applies to anything. In my experience maintenance charges don't increase at a faster rate than other expenses. You should aim to let to tenants who don't create problems......I seem to have managed it for over 10 years so I'm sure you can to. There are very few problems that will result in the management company complaining to you. Restrictions are there for good reasons. They are there to ensure that everyone else is able to enjoy living in the building without being continually distrubed. Laminate is not the best floor covering for rental property. Damage is virtually impossible to repair, costs more to install and unless you buy expensive product its life expectancy is no longer than cheaper alternatives.

- One of the sorts of concerns I have re: tenants and this particular flat is an example the marketing woman gave us - which is that if someone was to dump, say, a mattress outside, all the residents would be billed. Of course, you'd hope that wouldn't happen - but perhaps a tenant that wasn't going to be liable for that bill, would be happy to leave stuff out for the bin men that they shouldn't (or am I being ridiculously pessimistic?). There's a clause about not having pot plants on the balcony and not hanging washing on it - not criminal offences, but how do you know how jobsworth a management company are going to be?

As for the flooring issues, it's not so much what it would stop us doing, but what someone buying the flat on in the future would think about it - whether it would put them off.

I'm leaning strongly towards either buying the first property outright (hence doing away with the associated risks of having a mortgage PLUS if we find we HATE bing LLK's, we can always leave the property unoccupied without having to pay the bank every month) - or buying both 2 beds.

No mortgage usually means more tax to pay.

- I *think* the gross profit would be less than £5k per year - and at least it would be money spent from profit we've made, as opposed to paying a mortgage in void periods...or am I totally backwards in my thinking?

I did read in a property investment book today that more BTL's actually reduces risk - still trying to get my head round that one!!

,

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An advisor is in the business of making money by his client taking on as he advises so do read between the lines when being 'advised'.

Some years ago I was advised that I must invest 15% of my salary for any hope of a reasonable future pension. He was visibly upset when I described an alternative with more chance.

Both ways have proved to be less than reliable and neither of us had a crystal ball. I took my chance with BTL, he didn't get his commission.

The new businesses cold be a good source of T's, too close could mean late night problems ??

The property is at the end of a small cul-de-sac on an estate, about 3 miles away from the proposed retail park - so near enough to be an attraction for tenants, but far enough away not to cause problems.

Some areas have risen in value during this 'dip' ours has but all our portfolio has been devastated.

A £7K increase must mean some good improvements to the property in that time.

I would tend to think rather than this being a positive sign that you are paying some ones profit, nowt wrong with that if it represents value.

Hmmm, I can't answer that. We've viewed the property and there's no obvious recent improvements - it was only built in 2004, so UPVC double glazing as standard, standard issue kitchen, bathroom could do with a new vinyl floor/ re-sealing/general smartening up etc. The whole house is plain white, so no obvious costly re-decorating.

A good point made earlier about flats has likely answered one of my questions.

When we bought the flats in 2000 renting was a doddle, nowadays the voids are getting longer. I am more fussy (experienced) and don't re-beautify them between each let, but the view that there are just too many properties developed for the single is a good one. Toooooo much competition. Cheers buddy this may help in any selling decision.wink.gif

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- One of the sorts of concerns I have re: tenants and this particular flat is an example the marketing woman gave us - which is that if someone was to dump, say, a mattress outside, all the residents would be billed. Of course, you'd hope that wouldn't happen - but perhaps a tenant that wasn't going to be liable for that bill, would be happy to leave stuff out for the bin men that they shouldn't (or am I being ridiculously pessimistic?).

My local council removes household items for free so there wouldn't be any costs. Perhaps yours provides the same service ? But I'm sure you have far more important things to concern yourself with than an extra £ on your service charges at the end of the year anyway. Just to put this in perspective......In over 10 years, with lots of properties, mainly flats, at least a hundred tenants over that time I have NEVER once been charged extra for someone 'dumping' a mattress or any other household item.

There's a clause about not having pot plants on the balcony and not hanging washing on it - not criminal offences, but how do you know how jobsworth a management company are going to be?

I think you are approaching this from the wrong direction. These sorts of restrictions are there to help you not cause you problems. How do you think your development of flats would look like if everyone was permitted to hang out their washing on their balconies.......it would probably look like a chinese laundry ! By not allowing washing on balconies it improves the look of the development and helps to maintain/ increase its value. Try and think positively towards these restictions. My flats have loads of restrictions....I agree with all of them and it hasn't seemed to have affected the properties ability to attract tenants, buyers or increases in the property values.

As for the flooring issues, it's not so much what it would stop us doing, but what someone buying the flat on in the future would think about it - whether it would put them off.

It doesn't seem to put buyers off in my part of Essex. ALL new developments will have these types of restrictions. I have some flats that are now 24 years old and they require carpet in all rooms except bathrooms & kitchens. Works fine for everyone.

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I take your point and completely agree, Richlist - the restrictions are very attractive to me as a potential homeowner or landlord, with regards to the overall look and upkeep of the apartment block. I guess I'm really just concerned that, while I would be happy to comply with the "behaviour" terms, maybe a tenant wouldn't...and then we'd have to deal with complaints from the management company.

Blimey, I just keep going round and round what might be the best thing to do - in the first place, the apartment was attractive because, a/ it's brand new, so no real worries about things breaking down and also very appealing for a tenant, b/ it's one bed - so I figured there would always be potential for tenants and selling on to those people who can only just get onto the ladder, c/ it's in a fantastic location, looking over a nature reserve, walkable to the station and local shops and pubs, close to the motorway.

Going by my calculations, it also gives the best yield...but then there's the maintenance charges and ground rent (which put a big dent in that), the possibility of fairly rapid turnover of tenants (with associated agency fees) , depreciation in value historically etc etc etc...

Mabe I'm just not cut out for the unknown/unpredictable?

I really do appreciate all the input from you and the other posters - at least if we decide against BTL's, I'll know that it wasn't for want of information and research.:)

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Experience teaches me that 2 beds are far more popular than 1.

I have rented my 1 beds to couples (I wouldn't if there were selection of desirable singles) then they are too small soon enough, with increased wear ant tear being very possible.

Whilst the return looks groovy the additional headaches aren't.

My freehold lays down the chargeable ground rent for the lease period (remainder of 99 years).

Charges for maintenance / repairs are divided by each flat in the clock, so far there haven't been any as the lease company do some, but I do much myself also.

I own 5 of 6 so it's intelligent to.

The 1 I should have bought in 2003 is the biggest headache of the whole, and I have no control. My point is that the 1 bad apple really can rot the lot, the git has cost me a bloody fortune.

If I could manage the lot it could be as sweet place and I guess I would be saying it's a good idea.

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Experience teaches me that 2 beds are far more popular than 1.

I have rented my 1 beds to couples (I wouldn't if there were selection of desirable singles) then they are too small soon enough, with increased wear ant tear being very possible.

Your experience is important but as with all of us our individual experiences and opinions don't necesarily reflect the situation in all areas of the country as it can also be affected by location, price, type of tenant, property condition, how its managed, running costs, conditions imposed by the landlord etc etc.

If we are talking flats my experience in Essex is exactly the opposite. I don't let to people with children and my 2 beds sometimes take longer to let...... I am VERY selective with tenants which doesn't result in a fast turnaround.

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