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  • Property-a-holics

    Calling on the wisdom of Jonathan Clarke!

    (*Moderator note:  This comment was split off from another thread as it was not related to the original topic*).

    Can I please ask for your advice JC, slightly unrelated to the original topic:

    My portfolio is made up of 5 1-2 bed flats in London, bought around £200k each, each cashflowing £600-700 pcm. I am comfortable in this market, my properties let like hot cakes. So far so good.

    I am suddenly noticing deals further into the centre in much better areas, which frankly I couldn't afford until now.

    So, shall I move further in and buy a flat within moments for the City for £325k, needs £20k refurb and will let for £1600, although I don't know this market and how long it will take to let. This has massive scope for capital appreciation and could probably flip it once the market picks up.

    Or do I stick to my 200k flats and buy 2 of them for the price of the first one????

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    Its the eternal conundrum isnt it . Stick with what you know or stretch yourself

    What I would say is

    London isnt going anywhere . It is very very stable

    So medium / long term everything is good . Its just the Short term which is making people nervous

    So if you feel going in a bit more central is ok now because of price drops then go in for that kill

    Its the DD you do on pricing which will determine that. Punch that calculator like there is no tomorrow

    Look for all the evidence you can to support your view that prices are good value in that area at 325K

    But also counterbalance that with the negatives so you don`t lose sight of any reality you may have missed

    You have a good bedrock with your 5 so you have got a good grounding .

    So I would say yes buy one of the new breed first and see how you get on

    Central is always good I feel . People pay a premium for that

    As I built my own portfolio there are times when i stuck with what i knew and times when i went out on a limb

    All I can say is that each time i went out on a limb I now am glad that i did .

    I look back and say -  that took some doing but I`m glad I got stuck in

    What isnt your comfort zone now will become your comfort zone in 10 years

    I cant measure gut feeling but when all the DD in the world is done  - that is the final deciding factor for me

    Good Luck

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    Jonathan Clarke. http://www.buytoletmk.com

    " Or do I stick to my 200k flats and buy 2 of them for the price of the first one???? "

    What do YOU today think you should do? Only you have done your research, only you have bought, renovated (possibly) and rented out these flats, you know what you're doing, so what do YOU think you should do?

    Sounds like potential greater Capital Gain is sticking it's oar into your thought process. I love CG so I'm biased.

    JC has great info and I can't remember the last time I disagreed with what he said, but you've already started walking the walk....

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    Well, yes but I have to occasionally bounce ideas off of others if only to articulate the pros and cons to myself.

    Also, I am so charmed by the central London area that I am considering that I worry that I’ve lost my business common sense:-)))

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    If that's the case, then as JC said, buy one, and then you'll know the score. Anything else and you will always be wondering 'what if'?

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    Can I ask are you investing via a company or in your own name if you do expand ?

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    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.

    In my own name. The company structure doesn’t work for me.

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    Are you borrowing money or doing this for cash ?

    If you're borrowing in your own name will S24 effect you long term ?

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    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.


    I will have to devise a sustainable model over the long run if I want to buy more but for now I need the rental income and have to keep my borrowing costs to the minimum.

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    What LTV do you use on purchases out of interest?

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    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.