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Firstly thanks Vanessa for setting this up - what an amazing resource full for really helpful info.
I'll try to keep the story short! I've been living in the Middle East for 9 years. Used to own a flat in London which I sold 2 years ago for a deposit for my family home here so have some experience as an accidental landlord and purchase/ sale process.
My mum passed away a couple of years ago and left some inheritance money. As it was her dream to invest in property (which she never fulfilled - dammit!) I would like to use this money to build a small portfolio to serve as a pension pot and legacy for my kids along with possibly serving as an emergency fund for the huge mortgage I have on our home!
I have 100k to start.
I'm currently researching, researching, researching and confusing myself trying to define an area. As I'm so far away choosing somewhere close to home and walking the streets doesn't apply. I have family in Birmingham and Norfolk so possibly somewhere close to there.
I have also been in contact with a company in the North East who specialise in buy, refurb and rent. They are a young company (only established last year) so I can't do a great deal of due diligence on the company. In principle the deal looks good on paper. They charge a fee but will handle sourcing, refurb and help with setting up mortgage and future management agent. I would buy in cash and then mortgage once refurb complete. Rinse and repeat. Problem is they ask for an upfront fee which concerns me. I have sent their contract to a solicitor for review.
My thought was - allocate 50% of my funds to a straightforward buy to let. The other 50k to buy, renovate strategy (maybe??).
I am planning a viewing trip back to the UK before I sign on anything so want to have my areas defined before flying.
Thoughts and advice greatly appreciated.
Thanks in advance
We're in the Middle East too - living in Dubai for the past 4 years and we are now looking to invest in property. My husband used to work in Birmingham and I am from Suffolk so we're not far off each other there! Unfortunately, some of the prices in East Anglia are MUCH higher than up north. With regards to areas, we've been looking at Accrington & Rossendale. We did look around Birmingham too, Moseley and Kings Heath.
We are also using a company like you mentioned to source, refurbish and rent. The one we are dealing with doesn't ask for the fee's until the property is sourced etc though, so it might just be worth looking into their terms and coming to some kind of agreement.
Personally, those lower value deals are a great way to go, because getting a mortgage being an expat is basically impossible for a 50k property. We did a LOT of research and spoke to a LOT of brokers and the lowest property value we could get financed was £75k (at 70% loan to value). Maybe if you wanted to increase your cash flow you could flip a lower value property instead renting it out and then build your cash that way to then leverage over mortgages for higher value buy-to-lets? Just an idea.
Definitely a good idea to split the cash between a couple of strategy's though.
What made you pick Accrington and Rossendale? (I went to college there!)
I am part of a another forum where I found the sourcing agent/property management that we will be using. He has had some amazing results in what he has been doing and started off in exactly the same boat we're in so I originally went to him for some advice, and it turned into him viewing some properties on our behalf in his local area.
Obviously we did our own research into the area and decided on the towns that we were interested in and the ones we weren't. Did the maths and it works out pretty well for us. We're currently working through the mortgage stage for a property in Accrington close to the station (great commuter links) so hopefully it all goes swimmingly!
Hi Tiffany,Did you check if the sourcer you are using is part of an independent redress scheme? It is a legal requirement that they are. If not, they are trading non-compliantly and you have no routes of redress should things not turn out as planned.
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
Yes, I have checked all legalities thank you
Thanks so much for taking the time to reply. I'm based in Dubai too.
Would be interested to find out more about the company you have used and your experience if you're ever free for coffee :-)
Sounds good to me. I'll pop you a message
Hi Tiffany. Sorry I haven't messaged you back yet. As I'm a newby to this platform I don't yet have the permissions to send private messages.
Would still be up for that coffee though. Are you by any chance going to the Property Hub meetup tomorrow evening? Its in The Scene from 7pm onwards (although I'll be there around 8).
Unfortunately we wont be going tomorrow, but you'll meet some great people there that have lots of knowledge on what we do.
Try and get some time with the guy who runs it, he is very knowledgeable!
Hopefully see you at the next one.
Hi Veronica and welcome to the tribe.Remote BTL when you live in the country has enhanced risk, so being an ex-pat, the risks are even higher imho.There is no one who will look after your mum's inheritance better than the person you see in the mirror each morning, so I would be very wary of using third parties, especially new companies with little/no track record. You will lose control of your mum's money and I am sure you agree that it could be devastating for you if something went wrong.The safest thing for you to do imho is buy a property that is already tenanted. This vastly reduces your risk imho. Perhaps start looking for tenanted properties (houses) in Birmingham and Norfolk so that you have family members close to hand if you need a bit of local support.This video outlines the many benefits of buying a tenanted property and how it greatly mitigates your risk:
My strategy for you would be to find a reputable local lettings agent and ask them if they have any landlords who are selling up and/or look on the Vesta platform to see if they have anything suitable.You could purchase something that will need refurbishment when the current tenancy ends, so that you can force the appreciation when you have a window of opportunity.I cannot urge you strongly enough to keep control of your mum's money. There are many, many stories on here of people who worked with sourcing companies and lost everything.This may also assist you >>> Advice and support for expat landlordsI hope the above assists with your decision making and good luck!