BUY TO LET-BEST WAY TO BORROW???
Discussion
I already have a few buy to let properties and as things mostly have gone ok with them Im thinking of buying some more.I have quite a few quid in the bank so I am wondering whether to buy one or two properties for cash,or borrow 50/50 and buy about 4,or borrow as much as I can over the longest term and buy about 7/8.Im 36 and am looking to buy houses that give roughly a 6/7% yield at current purchase/rental prices.Any ideas?????
How much risk do you like to take? Buying cash is ok if you find a place that will yield enough to warrent tying up your money in a property and give you an income, but this will be taxed at your highest rate.
Fully gearing up on mortgage is also not the best idea, as your margins between rent and mortgage payments will be tight and voids will cost you dearly.
I would suggest spreading your cash across as many as possible at about 75%LTV.
I specialise in portfolio clients.
If you would like a chat email through my profile.
Fully gearing up on mortgage is also not the best idea, as your margins between rent and mortgage payments will be tight and voids will cost you dearly.
I would suggest spreading your cash across as many as possible at about 75%LTV.
I specialise in portfolio clients.
If you would like a chat email through my profile.
best bet?
if you're wanting income it'd be inefficient to tie up all your capital in one property..return on employed capital will be comparitively low and tax cost high.
middle way seems the best bet (as mentioned above
) as it offers a good spread risk/reward...that way you get self financing properties while not overgearing...leaving cash to re-invest or use as income or better still, increase the fund to cover voids 
a storming way forward is to buy a few properties and let them to the council - I have a few clients at the moment who have bought 4 or 5 properties on a 3 or 5 year BTL fix and let them on 3 or 5 year contracts to the council. with careful research of what type of property the council is in need of (and therefore which ones they'll pay a premium over market rate for) it is literally fire-and-forget with guaranteed bills and guaranteed returns
...at the end of the contract the council undertake to bring the property back up to the condition it was in when it was let...and you can choose to sell up or carry on. of course you could simply withdraw a bit of equity and buy a couple more properties to do the same with...
if you're wanting income it'd be inefficient to tie up all your capital in one property..return on employed capital will be comparitively low and tax cost high.
middle way seems the best bet (as mentioned above
) as it offers a good spread risk/reward...that way you get self financing properties while not overgearing...leaving cash to re-invest or use as income or better still, increase the fund to cover voids a storming way forward is to buy a few properties and let them to the council - I have a few clients at the moment who have bought 4 or 5 properties on a 3 or 5 year BTL fix and let them on 3 or 5 year contracts to the council. with careful research of what type of property the council is in need of (and therefore which ones they'll pay a premium over market rate for) it is literally fire-and-forget with guaranteed bills and guaranteed returns
...at the end of the contract the council undertake to bring the property back up to the condition it was in when it was let...and you can choose to sell up or carry on. of course you could simply withdraw a bit of equity and buy a couple more properties to do the same with...
smirnoff said:
Hi minimax, who are you working for now?
www.rookmatthewssayer.co.uk
looky down to the right...YourMortgageTeam..it's practically a self employed basis actually..although technically PAYE employed
Edited by minimax on Wednesday 23 August 11:22
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