What should I buy and who should I rent to?!
Discussion
After a year since buying my own house, I am now getting itchy feet about buying another!
I am not super rich and dont have an abundance of money but would like to invest in something that will tick over, but be there as an asset it later life. A pension of sort. Infact I fancy quite a few!
What do you recommend to buy to rent out?
I have been thinking of student accomodation. I have not been long out of uni and always found a half decent house in a good location hard to come by. Students, whilst a pain, would usually sign up for a year and often paid for by there parents (where I went anyway.) Also 4 paying individually soon added up, we were paying 18k for our house pa.
Or should I stay clear, and buy a modern build and rent out to a "professional". Less money per money, but probably less upkeep and less hassle.
Or buy up north. House prices seem dead cheap and surely whilst rental would be less the margin would be higher. Properties, albeit dives I am sure, can be had for 30k! No point even having a mortgage.
What should make me the most money, what would be the least hassle?
Any people out there who have done this who could pass there wisdom onto me I would be most grateful. If you get the advise right there is a beer..or 10...in it!
I am not super rich and dont have an abundance of money but would like to invest in something that will tick over, but be there as an asset it later life. A pension of sort. Infact I fancy quite a few!
What do you recommend to buy to rent out?
I have been thinking of student accomodation. I have not been long out of uni and always found a half decent house in a good location hard to come by. Students, whilst a pain, would usually sign up for a year and often paid for by there parents (where I went anyway.) Also 4 paying individually soon added up, we were paying 18k for our house pa.
Or should I stay clear, and buy a modern build and rent out to a "professional". Less money per money, but probably less upkeep and less hassle.
Or buy up north. House prices seem dead cheap and surely whilst rental would be less the margin would be higher. Properties, albeit dives I am sure, can be had for 30k! No point even having a mortgage.
What should make me the most money, what would be the least hassle?
Any people out there who have done this who could pass there wisdom onto me I would be most grateful. If you get the advise right there is a beer..or 10...in it!
There's a ticking time bomb right now as far as have-a-go-hero-landlords are concerned. Soon as the interest rates kick in.
not saying you can't do well but it's a long term investment you need to plan for, don't plan on the rent to easily cover the upkeep costs and mortgage and you need a good slush fund to cover problems, which can include anything from difficult tenants to cannabis farms, either of which can see you with no income for several months and £k's worth of costs.
not saying you can't do well but it's a long term investment you need to plan for, don't plan on the rent to easily cover the upkeep costs and mortgage and you need a good slush fund to cover problems, which can include anything from difficult tenants to cannabis farms, either of which can see you with no income for several months and £k's worth of costs.
Each area is different, as are each landlord’s experiences.
Student accommodation and flats can be lots of hard work, the former particularly if the property falls under the local council’s HMO regulations, and then through noise pollution, rows with neighbours, vandalism, repairs and general filth. My wife once said to me that we would be better to buy one large property in an upper class area, rather than lots of properties in a lower class area, and as wife’s are usually not wrong, that is what we did.
Of the 15 properties we have, which are divided between student bedsit accommodation, flats, 3 bed houses and two of the above “large type” properties, these two although divided into 2 & 3 bed flats give us the least amount of problems. Also being in an affluent area of Bristol, both properties have continued each year to show capital growth, show rental increase, are never vacant for long, with 2 sets of tenants having been in occupation for more than 4 years.
So to the OP, my advice is buy a property within easy reach of your location, to thereby manage and do remedial works yourself, if possibly buy one large property = one roof/garden etc., rather than 2 or 3 properties, buy property at the right price for potential capital growth, rental return, good location to bus routes, shops, schools and local employment.
Lastly, take time out to read local newspapers, visit estate and letting agents, search Rightmove etc. etc for both houses buying and rental prices.
Student accommodation and flats can be lots of hard work, the former particularly if the property falls under the local council’s HMO regulations, and then through noise pollution, rows with neighbours, vandalism, repairs and general filth. My wife once said to me that we would be better to buy one large property in an upper class area, rather than lots of properties in a lower class area, and as wife’s are usually not wrong, that is what we did.
Of the 15 properties we have, which are divided between student bedsit accommodation, flats, 3 bed houses and two of the above “large type” properties, these two although divided into 2 & 3 bed flats give us the least amount of problems. Also being in an affluent area of Bristol, both properties have continued each year to show capital growth, show rental increase, are never vacant for long, with 2 sets of tenants having been in occupation for more than 4 years.
So to the OP, my advice is buy a property within easy reach of your location, to thereby manage and do remedial works yourself, if possibly buy one large property = one roof/garden etc., rather than 2 or 3 properties, buy property at the right price for potential capital growth, rental return, good location to bus routes, shops, schools and local employment.
Lastly, take time out to read local newspapers, visit estate and letting agents, search Rightmove etc. etc for both houses buying and rental prices.
I've done most variations over the years from newbuild flats to terrace student accomodation to 3 bed semi rented to professionals. So here goes:
3 bed terrace rented to 4 students, each paying £60 per week plus bills the money was rolling in £960 per month with a mortgage of £300 however one girl soon failed to pay for month after month which was a right hastle and ofcourse they don't have any income so what can you do? boot her out and stick with the 3, I used an agent to manage this hastle for me. Then when i stipulate NO PETS and a girl has a kitten in her bedroom which craps everywhere. Then they move out cue disaster area wine stained carpets, 2 fridge freezers full of food, defrosted and rotting oh and the cat poo EVERYWHERE. Obviously you keep deposits but they don't cover everything. Oh and nowadays your have multiple occupancy laws, hardwired fire systems etc... I got out as soon as this came into force.
Next the professioanl market, they take a lot better care of your house, pay regularly and a lot less hastle but rents are reduced you will be lucky to cover your mortgage and if your paying an agent to manage the property for you that eats into your ability to pay the mortgage. Oh and the tax man will take a very small bit of your income.
If your in it for the long term and I mean 20 years+ go for it, get a new build with wooden flooring or very durable carpet and hope you get a good tennant who could stay there for 5 years. If you think you can handle the students buy a place in Liverpool give yourself £5k for the multiple occupancy stuff and make as much as you can, you will need a host of tradesmen and an account with carpet right.
Good luck.
3 bed terrace rented to 4 students, each paying £60 per week plus bills the money was rolling in £960 per month with a mortgage of £300 however one girl soon failed to pay for month after month which was a right hastle and ofcourse they don't have any income so what can you do? boot her out and stick with the 3, I used an agent to manage this hastle for me. Then when i stipulate NO PETS and a girl has a kitten in her bedroom which craps everywhere. Then they move out cue disaster area wine stained carpets, 2 fridge freezers full of food, defrosted and rotting oh and the cat poo EVERYWHERE. Obviously you keep deposits but they don't cover everything. Oh and nowadays your have multiple occupancy laws, hardwired fire systems etc... I got out as soon as this came into force.
Next the professioanl market, they take a lot better care of your house, pay regularly and a lot less hastle but rents are reduced you will be lucky to cover your mortgage and if your paying an agent to manage the property for you that eats into your ability to pay the mortgage. Oh and the tax man will take a very small bit of your income.
If your in it for the long term and I mean 20 years+ go for it, get a new build with wooden flooring or very durable carpet and hope you get a good tennant who could stay there for 5 years. If you think you can handle the students buy a place in Liverpool give yourself £5k for the multiple occupancy stuff and make as much as you can, you will need a host of tradesmen and an account with carpet right.
Good luck.
With student property is the town swamped with student lets? can you buy a house in exactly the right area, i.e. enough parking, close enough to the nightlife etc, get it wrong and you may not get the house let, also with students check the Uni has no plans for more accommodation of their own.
BoRED S2upid, I recognised much from your post. I have had the mother on the phone complaining because there is a rat running around her daughter’s bedroom, and upon investigation finding rotting food in the kitchen, broken bags of refuse in bedrooms.
As for rent arrears, not for the first time either, but I presently have a situation with a young 18 year old female student, who is more than 5 months in arrears. From her tearful conversation with me, and a conversation with both parents, the parents have recently split up, and have been promised all the rental arrears to be paid at the end of this month, February. As I said earlier not the first time I have had to face such a situation, and I find it difficult because of the student’s ages and their situation to cause them any more embarrassment or upset. At times with students you have to be more than a landlord, social worker, house maid etc. etc.
As for rent arrears, not for the first time either, but I presently have a situation with a young 18 year old female student, who is more than 5 months in arrears. From her tearful conversation with me, and a conversation with both parents, the parents have recently split up, and have been promised all the rental arrears to be paid at the end of this month, February. As I said earlier not the first time I have had to face such a situation, and I find it difficult because of the student’s ages and their situation to cause them any more embarrassment or upset. At times with students you have to be more than a landlord, social worker, house maid etc. etc.
Wings said:
BoRED S2upid, I recognised much from your post. I have had the mother on the phone complaining because there is a rat running around her daughter’s bedroom, and upon investigation finding rotting food in the kitchen, broken bags of refuse in bedrooms.
As for rent arrears, not for the first time either, but I presently have a situation with a young 18 year old female student, who is more than 5 months in arrears. From her tearful conversation with me, and a conversation with both parents, the parents have recently split up, and have been promised all the rental arrears to be paid at the end of this month, February. As I said earlier not the first time I have had to face such a situation, and I find it difficult because of the student’s ages and their situation to cause them any more embarrassment or upset. At times with students you have to be more than a landlord, social worker, house maid etc. etc.
Blimey, thats very unlucky but students are a potential minefield.As for rent arrears, not for the first time either, but I presently have a situation with a young 18 year old female student, who is more than 5 months in arrears. From her tearful conversation with me, and a conversation with both parents, the parents have recently split up, and have been promised all the rental arrears to be paid at the end of this month, February. As I said earlier not the first time I have had to face such a situation, and I find it difficult because of the student’s ages and their situation to cause them any more embarrassment or upset. At times with students you have to be more than a landlord, social worker, house maid etc. etc.
However, this does not exempt professionals either.
I had a professional in a flat of mine who was utterly charming, good job, nice car. All was going well nntil he lost his job and got into arrears. I kicked him out by the terms of the contract however the cheeky b
d had cut an extra set of keys and had been seen going back to the property by the neighbours and proceeded to steal the oven! You can never be too sure!Made a lot easier for children to enter university today, so students today come from a much wider social background, with many of those parents on low income, and who simply can not finance their child/ren through university.
I get many students from the South Wales area, not the most affluent area of the UK, and many students leave with bank overdrafts, credit card debts, mail order catalogue’s debts etc. etc.
I get many students from the South Wales area, not the most affluent area of the UK, and many students leave with bank overdrafts, credit card debts, mail order catalogue’s debts etc. etc.
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