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Knowing what you know now would you advise being a landlord?


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With the knowledge you have gained so far being a landlord and all the changes about to be and have been brought it would you advise a friend/relation with a small chunk of money to invest in property to rent out?

When I say a small chunk of money I mean enough to fund the 25% deposit on a small (1/2 bed flat) BTL or 3.

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That's impossible to answer without a number of considerations...I think my advice would be......

* Providing you could find the right property, at the right price, in the right condition, in the right area.

* Providing you didn't need to spend loads of money on it.

* Providing you bought via a Limited Company.

* Providing the service charges and ground rents were reasonable.

* Providing you could get a mortgage with reasonable terms and conditions.

* Providing you had the backing of a good agent or experienced landlord or were prepared to spend time researching and educating yourself thoroughly.

* Providing you were prepared to spend time and effort getting it right.

THEN........yes, I'd recommend you go ahead........but after December 12th. If Labour win the GE ignore all of the above and find somewhere else to put your money.

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What a question to ask Grampa. 😊

Everything that Richlist has said applies with my answer back to you.  I am not so sure it would be worth doing it right now but having said that who knows when the time is right?

I can go back to 1988 when I wanted to buy my 1st property to renovate and I could not find a mortgage lender and the one lender that was recommended to me the T&C's were outrageous and back in those days most lenders that I knew of wanted a percentage of any future selling price not to mention borrowing rates of between 6 and 7%

Much easier now of course to get mortgage money if you have a good deposit to put down.

But the question is would I do it again and would I advise another person to do it?  Yes, of course but that person would have to know what they are doing by education of being a landlord and what it all entails.

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I take a similar view and am still personally looking for good deals.

One of the reasons I ask is I have an friend in his forties who has talked about obtaining BTL for a few years but didn't have the capital for the deposit. He is about to inherit his mothers flat (mortgage free worth approx 180k) and  his first thought was to sell and then pay off his  small personal mortgage and probably blow the rest.

So I suggested as a option rent out his mothers house at 750pcm remortgage and pull out about 60k which would give him the down payment on 2 one bed flats which would rent out for 550 pcm each. Generating a gross income of 22k+ which with a quick calculation would generate at least  10k+ income after service charges, agent fees, mortgage payments. I know there would be tax, repairs empty period as well. Not a huge income I know but a foot in the door and enough income to fund each other if maintenance or other issues issues arise.

I didnt know if I was bias  being in the profession/industry  and owning a number of small BTL myself.

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The idea and plan you are proposing is sound enough but your friend has to have his heart in what you are suggesting he does.

I have met many people who entered the letting landlord business and didn't stick at it and either sold up and took a small profit or in case a friend of mine sold up and lost nearly £20k in two years in spite of my advice to hold out. That was back in 2010. If they had listened to me they would be approximately £50,000 in pocket by now. I also made a mistake back then because I should have bought the property they were off loading at a bargain price.


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Surely a lot depends on the person taking the advice?  On here we are mainly 'can do' people with good inter-personal skills but some 'accidental' landlords are just not cut out for it. I meet them all the time.

I'm just imagining learning everything I know again as a newbie - and it ain't in any book for a quick read.

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..........and there are so many additional factors that an experienced landlord would automatically take into account when making a judgement on the suitability of a project......which someone new to the business might overlook. Let's list just a few.....

* Short length of remaining lease, increasing ground rents every x years, exorbitant service charges, freeholders managing agents not recommended, property not in a suitable area, limited parking available, poor exterior maintenance of flats.

Then there are decisions on how you are going to manage the job.....

*  Use an agent or do it yourself, pick your own tenants or leave it up to the agent, do they hold an emergency fund to cover unexpected items, are they prepared for when things go wrong, do they know what expenses they can claim, do their own tax return or use an accountant etc.

However, as I've said before, where else are you going to put your money to achieve a decent return ? It's no good sitting in a bank or savings account......that's not likely to keep pace with inflation.

My agent is a wealthy guy with over 40 properties of his own and he and his family are still buying.

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9 hours ago, Richlist said:

However, as I've said before, where else are you going to put your money to achieve a decent return ? It's no good sitting in a bank or savings account......that's not likely to keep pace with inflation.



That is exactly where I was back in March 2017.  Absolutely no point in earning 1.4% or less on deposit so I purchased another expensive property for cash. I was working on a principle that probably made no sense (but there again a lot of my decisions in the past have not made a lot of sense but I have always come out well from them  🙂   ). I also bought a flat back in September 2018 and renovated that and sold it on in June of this year just to keep busy. 

There is a lot of big money floating around out there as my EA Daughter will tell you that she does get a surprising amount of cash buyers into the office and 99 times out of 100 they all say the same thing..........poor interest rates.........not worth holding large amounts of money on deposit anymore.


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