X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • Buy-to-Let

    Best use of £50k? Passive income

    Hello

    Hope you are all well.

    Could you please suggest what is the best way to deploy around 50k-60k for maximum rental income? I would like to outsource the day to day running to a letting agent whilst I move abroad  to a low cost country.

    A cash buy of 50-60k could get me 500pcm on a cheap 3 bed house in the UK. I am hoping that someone can suggest a better way to use mortgage leverage and low interest rates to increase this monthly sum. For example 25k deposits on 2 x 100k purchases? I'm struggling to find areas where 100k could yield circa 10% on a normal single let. I don't really want to go down the hmo route as I plan to be hands off whilst I am away. Please could you tell me of the realistic net figure after agent fees and other running costs.

    Many thanks

    0
    0

    Hi.

    Please ignore this comment sounds like a pitch.

    You can read previous posts to know I have a property portfolio is and around Liverpool.

    My company now work with investors like yourself to identify, procure, refurb and manage and build their porrfolio.

    With 60k, if the right properties could be found. And they are out there you could procure 3 and realise your strategisted yields. Then after 6 months looks to refinance and extract a significant % of the capital investment.

    And don't again.

    I am NOT promoting the idea of no money left in. My experience and examples are capital os left in and based on the property being LET 100% can be full extracted after 2-3 years. Again I see myself being open to other PT members throwing cookies at me with the no void and maintenance figures thrown in. 

    My philosophy is the work done on the refurb and management to mitigate the risk. Plus the maintenance team and practical charges that are applied.

    So dont be fixed on property purchases at 100k or 3 bed, you can spread your investment risk by building a portfolio where they support each other.

    Again.....DONT be misled with advertised properties of 10% - 12% yields that on paper produce said bottom line figure without you or a property investment partner doing the DD. The street could be a nightmare and local knowledge is vital or get on Google maps and take a virtual walk up and down. Not a failsafe, but look at other property conditions and cars. If see if a local if have a cheeky bottle of cheap cider sitting on the step. (Sounds horrible and judgemental I know, but we have to look at the practical side before you investment your hard earned money)

    Richard.

    3
    0

    Our experience in Liverpool is that valuers will value your done-up property (especially only 6 months after purchase, as lenders and valuers don't really believe in the concept of "BMV") at

    purchase price + refurb cost

    and no more. So it very difficult in practice to refinance and extract any funds.

    I hear from my network that others are finding the same issue throughout much of the country.

    0
    0

    Hi Rassie,

    It will depend on the lenders you choose and their criteria. Some lenders offer a "day one" advance which is based on purchase + refurb at 70% (% is an illustration)

    There are lenders who will value the property at it true valuation, though of course there is a 6 month lag in place before the advance can be applied.

    The surveyor will value the property, the criteria to lend is the responsibility of the lender.

    I have only recently had a surveyor value a property at £0 as it was classed as a "major project" that did not meet the lenders lending criteria. The major project is a 5K spend. So we went again with a new lender. Valued up. (The trick for me, is working closely with the broker give them as much information as possible and find the right lender, not always the cheapest)

    0
    0

    Buy one property with a 75% LTV mortgage in your name in an area with high rental demand to ensure that you can pick and chose your tenants.

    Don't buy some run down terraced house in a declining area, there won't be tenant demand and you won't see capital appreciation either.

    3
    0

    make sure you factor in S24 into your calcs..

    1
    0

    Or get yourself setup correctly from the start based on your long term investment strategy.

    0
    0

    Your choice is buy now and lose the lot as property leverage in current market conditions is very risky. Just sit back and wait as better opportunities will come along over the next 12 months or so.

    1
    4

    50k today is not a lot of money

    Stamp Duty and fees all eat into your funds and then you have a 25% deposit

    also I think if your living overseas and using an agent they take basic rate tax off you with each payment they make to you

    check it out


    1
    0

    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.


    0
    0

    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.


    Hi I really must invest asap to get urgent cash flow. I appreciate the replies. Please critique my understanding 1. Assume I have separate funds for adult 2. 50k x 4 is 200k.  200k portfolio @ 10% gross yield is 20k per annum or 1666 per month. 3. 150k mortgage (75% borrowing) at 2.5% interest is 312pcm. 4. So 1300 cash flow before additional costs. 5. Which areas in the uk could i purchase a few properties with leverage And get this type of return e.g 70k house 7k rent / 80k house 8k rent etc ?
    0
    0