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  • Buy-to-Let

    Let's hear your CURRENT BTL success stories!



    Hey Folks,

    So I've been lurking on these forums for a while now and I've just recently started my journey in to property investment. 

    I've posted my first post in the new members area with some questions - thanks to everyone who has been really helpful and replied to those so far!

    I've noticed recently there has been quite a few fairly negative posts about how BTL has become more difficult in the last few years and as someone who is still very excited about the prospect and idea of starting my journey into something which has been a passion of mine for a while, I'm curious to hear about your CURRENT success stories to try and counteract these slightly! 

    So these can be anything from: great tenants, great deals where you've got a brilliant yield, great capital gains - anything and everything positive about your journey would be brilliant. Ideally the more positive, current and inspirational the better!

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    Everything on PT is "current" really.  Just because you are not in buying mode does not make what you are doing less relevant.

    People asking questions about a property purchased 10 years ago are just as current as someone posting about completing on their first property yesterday.

    Being a landlord is an on-going situation and a linear journey and we will all pass through the four stages - Pre acquisition, acquisition, management, and disposal/exit.  Running a business never stops!

    There's plenty of positivity but, as a general observation, people are less likely to share their success stories than they are to try and get help if they have a problem - just in the same way that people are far more likely to complain about poor service than they are to praise good service.

    Here's a couple for starters though ... :

    Overcoming the fear as a novice developer

    Success! SDLT refund on "uninhabitable" house

    Also worth remembering, you likely learn more from the failures than you do when everything is hunky dory.

    I like Cheryl Cole's saying ... "I've learned so much from my mistakes, that I'm thinking of making some more ... ".

    And a little story from me:

    At the beginning of July, I did not have a single booking for one of my holiday lets in August.  This was unprecedented!  It is normally booked up for the whole of August by Easter.  However, bookings suddenly came in, and it was fully booked by mid-July.  Panic over!

    I hope this thread will encourage more people to share some positivity though as you can never have enough of that in my book. Smile

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    I can't believe you quoted Cheryl Cole! But it's a good point, in my world a complaint well-resolved often delivers greater customer satisfaction than no complaint at all.

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    ...I never imagined someone who interviewed Lemmy would quote Ms Cole...
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    Hi Horrocks - lovely to see some enthusiasm but the reality is that I wouldn’t buy now. My journey was thus:

    Bought a flat with a newly extended lease at the bottom of the market in 2008 using redundancy payout for deposit. Sold it last year for twice what we paid for it. No stamp duty to pay at the time as there was a stamp duty holiday. 

    Bought 3 bed terrace 2009 - again very cheap. Drew down on domestic property to get best deal. Stamp duty payable but no BTL premium

    Bought second 3 bed in 2009 (end of terrace) - repossession. Now worth double what we paid for it. 

    Regulations gradually got more and more and I’ve been able to work full time and manage the properties but if I had to learn it all now I would have struggled at the time. I didn’t have s24 for ten years.

    Properties are owned as tenants in common which helps with apportioning the tax element as my other half is a carer and has minimal other income. 

    Virtually nil mortgage left on domestic property.  Value of assets about £1.2 value of mortgages about £250k so could easily leverage assets if I wanted but I don’t consider it worth it. 

    All properties will be paid off by time I am 62 in 15 years time. 

    Why I wouldn’t buy now is:
    • My age
    • Stamp duty costs now compared to then
    • S.24 - the income from the two properties is just enough to keep my other half below higher rate tax
    • Loss of faith in some humans and a bit of the business eating at me too  - we have two tenants in our time owe us money and some tenants do wilful damage. We have lovely tenants now but it annoys me when people say they want a ‘passive income’ - it isn’t passive. I’ve been to court and made a woman and her three children homeless. I don’t like that.
    • Capital growth doesn’t look good at the moment
    • Regulation is growing
    • Threat of right to buy
    • Political landscape
    • When I borrowed I didn’t have to have a full scale investigation - borrowing now is a PITA
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    Thanks for your message - what is the main reason you wouldn't buy now? I'm keen to know more around that part as I've seen a few people mention it. Do you mean you wouldn't get in to BTL at all now?

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    I am happy with my little portfolio right now and plan to stay in unless something like right to buy came in and then I would review (as would thousands of other landlords). I don't regret for one minute any of my three investment purchases. I sold the flat as it was a liability (see Vanessa's great post on why always buy a house/freehold) and S.24 was the tipping point for not holding onto it. I am of course delighted that selling the flat means apart from £20k on my domestic property I have no mortgage. I have left that amount in case I need to draw down in the future (e.g. to help daughter on property ladder).  I have a bill of £30k CGT to pay in January I might add that is currently sitting in premium bonds.

    Properties are still overpriced in some areas and people asking unrealistic prices. The key is about buying at the right time in the right location at the right price. The person who bought the flat next to mine six months earlier in early 2008 (or maybe late 2007) paid £90k more that I did 6-9 months later. As I lived in the area I knew the flat was bargain, I'd seen it on the market before, I bought from someone desperate to sell too. The government was so worried there was a stamp duty holiday announced but about a week after we put the offer in when prices got a small bounce (that was luck rather than design). I was around the corner from me so easy to manage. 

    I don't feel confident that buying now wouldn't wipe out any equity I put into it. I see other newbie landlords excited at the fact they are part of the 'game' and bought say a year ago but hadn't realised about voids, property price slides, all the set up costs etc and have lost £15k in costs and £6k in voids while they decorate or refurbish.

    Example of sums for the same property:

    Property purchase in 2008: £164k, deposit £64k, LTV 60%, no stamp duty, ground rent £50 a year rent achieveable £950pm, mortgage £395pm - no s.24 so after tax, gas contracts etc we cleared about £450pm - sell the flat ten years later, pay off domestic mortgage (which we'd used to seed the purchase of the two other properties) with the capital gain.

    Property purchase in 2019: £320k, stamp duty £15,600, rent achievable £1,100 s.24, gas contracts, Ground rent going upto £250 a year from 2020, council tax now payable on voids (wasn't for first 7 years when I owned it) - the amount you'd need for the deposit to get 60% LTV is massive and the achieveable rent to the amount you'd have to put down just hasn't kept pace. No prospect in near future of capital gain.

    It is the same for my other properties they wouldn't make financial sense if I was buying them now, but they do as I bought them a while ago. I would consider buying again if the financial breaks were better and the market bottomed again, but not at the moment.

    I also had a great back up that I don't want to use again. When we had two lots of tenants not paying we had to rent out rooms in our own home to make ends meet. That was great we had that option but it was an invasion of privacy and I hated the tenants for doing that to me. I don't like hating people, I like to believe in the best so I am very very cautious about who I rent to now. I know being a landlord has changed me and my outlook on human nature, call that naivety at first.

    I also work in a law firm (in a support capacity, not a lawyer I might add!) so can do my own legal work and paperwork so s.21 and s.8 I can do, even then it wasn't easy. I was told by the charity supporting the family that I was turfing out that it was the best paperwork they'd seen and they were disappointed that it was one of the rare occasions they couldn't pick up on something and throw out the notice due to a technicality - nice!


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    Hi Horricks,

    Current successes:
    I have a full compliment of 18 tenants.
    They are all up to date with their rent and seem happy.
    I have 3 properties coming up for fixed rate end periods and interest rates are amazing + I can withdraw a load of equity.
    Having the properties means that we can be comfortable whilst my wife is on maternity.
    My last property bought through a ltd company will make a higher ROI than any others + by renovating I bagged a little equity.
    I plan to start an Airbnb shortly and am considering a SsAs. Yes some cash flow has dropped with section 24. But if I choose to stop working I can keep my income below the threshold and it will leap back up.

    The king is dead. Long live the king!

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    Thanks Mr Paye, what do you mean about the part around stopping working? Is there a financial tax relief benefit to working in your full time role outside of property you mean?

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    I mean if I stop earning my salary from my day job, and rely purely on my property income. I can happily live off that and keep my income below the higher-rate tax threshold (£50k) and therefore pay less tax, on my property income.

    I can do this, by choosing how much income I want to take from my company, deciding when to do property maintenance, paying dividends, contributing to a pension etc.

    #FIRE

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    I think like lots of LL's I tend to focus on the problems of the business and take the positives for granted.

    90% of my tenants are great and pay on time but the 10% that are a problem take all the time and stress.

    The best thing about the business is freedom to do my own thing and slow but steady capital appreciation if I can manage to hold my properties over the long term.

    Best CURRENT success is my LTV is now reducing after many years of being too high and several long term tenants that have been with me for 10+ years which I try to hold onto when dealing with the dificult ones.

    As a Northern LL my capital gains have not been spectacular like some on here and my greatest triumphs have come from overcoming sometimes impossible situations:

    In 2009 I had a property in deep negative equity - half what I paid for it four years before. Impossible to let as the council had issued a CPO and the area was a total no go zone. I was stuck with an offer of half my outstanding mortgage from the council and this was going to court for possession after nearly 3 years of stalemate.

    Two weeks before the hearing I was visiting the property and got stopped by a passer by who told me there was a fella wanting to buy any remaining houses and gave me a phone number. As I had nothing to lose I called and he asked me to name a price and give him my solicitor details. I jokingly doubled the purchase price and thought yeah right...7 days later the money came through to include my legal fees! I later learned he was a scout for a supermarket chain looking to get the land on the cheap from the council...

    Happy days you never know what will turn up in the weird and wonderful world of landlording!

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