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Hello. Please could you give me your opinions on the following income that I get from my properties (monthly) and tell me, if it were you, would you sell, keep, reinvest. All figures all have expenses taken off but NOT tax:
property 1 single let: £840pm
property 2 s257 HMOs: 7600pm
property 3: HMO: £1,352pm
Property 4: HMO: £750pm
Property 5: single let :£886pm
property 6: HMO on one contract £1164pm
i have no idea if these monthly profits are good, rubbish or so so.
They are all IO mortgages and most have recently been remortgaged but no ERCs.
I have equity in all of them especially property 2
i know it’s a very vague and general question but interested if what you all think thank you
It's all about ROI and work out based on your equity in them. Without know how much investment you have for each, no one could tell you whether they are doing well or not.
Ie. A 1 million pounds property generating 1000pcm is poor to say the least. But a £70k property generating 1000pcm will be classified as good for my books.
Good morning. It depends on your overall long term strategy. The overall monthly gross cashflow looks pretty healthy.
Also, the location of the properties is another factor to consider, in regards to capital appreciation.
I'd need to list the property values and amount of time / effort taken to manage each one to make a decision - but the lowest returning hmo would on the surface of it appear to involve the most effort for the return on it ?
DISCLAIMER just my personal opinion - for legal advice consult a qualified professional grown-up.
It very much depends upon your leveraged position. Will a loss of rent ( non payment by tenant) put you in a tight position and do you have a reserve to tide you over if no rent or other problems. Are the properties in good rental areas, are tenants hassle free, is there equity in the properties, how much and what term on the mortgages on. Many factors come into the equation . The main factor is to stress test the portfolio ie what level of interest rates hurt, how much can you afford the properties to drop before hitting negative equity, can you finance with reduced rentals. ALL these factors are coming home now, property prices are dropping and have further to fall. Borrowers will require larger LTV on refinancing. Interest rates going up - see gilt yields. Increased rent arrears -see latest tribe. Increased regulation and costs associated with this. Finally recession is upon us and its going to get much worst over the coming months.Key indicator is the B of E continuing to stress test the banks and told them to tighten up on loans and credit. why because they see another financial crisis coming and its not just Brexit.
Its simply impossible to critique with such little information
Basic fundamental figures are missing
Value of properties and your LTV are vital to know to even begin to advise
Jonathan Clarke. http://www.buytoletmk.com
It’s impossible to say, your numbers look good on the face of it, but what was your investment, does the location have any scope for uplift in value, how much work is involved?
As I was thinking of my portfolio, I realised that I am going to get rid of my highest yielding property in the next boom, because people don’t like to live in it. Therefore they don’t respect it and are looking to move in a year. It looks good on the face of it, I think it just has bad karma.
Maybe it's the people living in the property that are the issue, not the property itself?
Well, hopefully. I just relet it in spic-and-span condition, I hope these people will appreciate it and will live there for years to come.
Well as LL's we have an 'eternal optimism' gene ;->