What to do with £240k in property?

[Zeemax_Mini]

I'm currently renting a flat which I'm happy in, and I'm getting a great deal - so no rush to move. I've got £240k sat in a savings account from the sale of my last flat, which I refurbed and made some profit on. I'm setting up a business at the moment (relocations/buying agent), but I'd like to do something with this cash at the same time as it's earning next to nothing in the bank.

I'm wary of buying another place to refurb and sell on, as I don't want to get stuck with it sat on the market for ages which is a real possibility. I was therefore thinking of maybe looking further afield and buying a few, cheaper, flats and renting them out. I have experience of buy-to-let with my family who have a portfolio, but I don't know if I'd be able to get any kind of buy-to-let mortgage as I have no income at the moment?

Any suggestions as the the best way of investing my £240k in property, and if it involves gearing then how I'd go about getting the finance?

Cheers!

Dom

[chris7676]

Look at the other thread - http://www.pistonheads.com/gassing/topic.asp?h=0&a...
With this amount you could get a number of chepaer properites without a need for credit, but surely not in the area you are

Edited by chris7676 on Monday 30th January 10:20

[Slagathore]

3 £80k deposits, or 4 £60k deposits. Or 2 £100k deposits with money left over to do a bit of work on them, if needed.

Don't know about property prices where you are, but around here, you could get a few decent student houses for that much.

[Zeemax_Mini]

Cheers guys. Regarding the deposits etc though, surely I'd be unable to get mortgages without an income? Or would they lend solely on anticipated rental income? I've got a family holiday house down in Devon, and have seen a few flats down there around £50k each, rented at £450PCM - quite tempting to buy a few of those, spend a few grand on light refurbs and find long term tenants. My only problem with that is if I want to buy my own place in a couple of years I'd have to sell them, though that could actually work quite well if the markets picked up a bit and I've added value through refurbs.

Dom

[scotal]

Zeemax_Mini said:

Regarding the deposits etc though, surely I'd be unable to get mortgages without an income?

That's correct. BTL mortgages still require you to have an income. Most have a minimum income amount below which they don;t lend. Some lenders don't check the income, others do.

Zeemax_Mini said:

Or would they lend solely on anticipated rental income?

Nope, they'll base the lending decision on the property being self sustaining, but they want to see income in the background. (How else will you cover their payments during void period etc.)

Equally you said that you do not currently own a place. That's not going to sit well with the majority of BTL lenders. They like their applicants to be owner/occupiers. A very few don't mind if you rent whilst owning BTL, but allied to your slight problem with no income and you are going to really struggle to get a mortgage.

[Zeemax_Mini]

Cheers guys - both really valid points, I have considered the ground rent/service charge/unexpected bills which as you say would very quickly bring down the gross yield. Regarding the mortgages, that's what I'd imagined really. I guess putting all that info together it leaves me a couple of choices - buy one (possibly two) higher value buy-to-lets outright with the cash I have, or try and flip another project to make a chunk (though it is hard in this market). Gives me some food for thought anyway, thanks again!

Dom