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  • Buy-to-Let

    A true lesson of BTL from the North East ...

    I think you are on the right track

    DL

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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.

    Hi Douglas, I assume you dont believe in the 18year property cycle? If the cycle is relatively accurate we should see good growth in the next 8-10 years
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    Slowly working towards financial freedom

    I think a lot depends on the outcome in Europe

    until its sorted we are just all treading water

    But once we are out I think we will see steady growth in prices 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.

    Actually its 17.2 yrs and can be traced back apporx 200 yrs. So on that basis it will be 2024 before we take out the highs again. However this will be the time it does not hold true. We are now in uncertain times never before has the world debt problems etc  been this large and the consequences will be greater than most think. Very few believes the crisis we are about to enter into apart from those with the hindsight to fully understand. - just as the 2007/8 crisis until it was too late. I saw those problems well in advance and and very few believed me at that time , but was proved right later.

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    Hello DL, 
    How have you sourced your properties ? Same question to those who live in the south east but have properties in the midlands and north. Thanks Pat
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    I buy where I live Patrick

    I know my streets and I know my market

    Its a micro market nothing special to be honest


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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.

    Just agreed a mixed property (shop and separate flat, on one deed).  Agreed price of £185k (Midlands), lease on the commercial, 5 years left at £7k pa and the flat is currently vacant.  Flat will rent for circa. £600 PM giving an annual income of £14.2k.  Lower stamp duty (commercial) and 75% mortgage. Down payment of £46k and interest costs of approx. £3k.  No maintenance on the commercial and flat is in good rental condition.  I live in Surrey but yields here at 2-3% which is poor.  For me, Midlands is the furthest north I go for property.  I think it's a good deal!  Opinions?
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    Depends on commercial tenant, would also look around the street see how many empty shops there are. Theres ones near me up for 34k year rent for sale for 250K look a bargain, till you try and rent it, find out you can probably get 2 year free just so they can get rid it.

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    What's your worst case scenario plan if the commercial tenant bails out/lease ends and you can't find another one?

    Deals are much more than just the figures, there's so many other aspects to take into account. No 2 investors on here have gone the same route so it's difficult to tell how good a deal you've done?

    Will you self manage it?

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    The good thing about London is that you pay more for the same sized house (avoid flats and service charges) and salaries are firm or rising in London. If you are careful, maintenance can be a much smaller part of yield, even though yields are less. Equity generally goes up with salaries in the area. The lower yields in London balance the effort required to manage in London, which can be lower per pound invested. If buying in London you need to look to future development potential, the ability to let as rooms, things that will jack up the yields overall. Switzerland is very densely populated, but there are some cheaper houses there than "up north". Up north is still "expensive" and risky as what is left of manufacturing could take a knock. Strangely German property relatively close to the Polish border is cheaper than Poland in some cases. It has been like that for 20 years. I guess there is language and cultural resistance which affects supply and demand. London has the opposite effect with tourists/foreigners always looking when the pound takes a knock. When the pound takes a knock, prices firm or rise, and your LTV goes down.

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