I'm thinking about buying some houses in hull.
Discussion
Yes you read that right. Hull.
I've a couple of friends that have 3 or 4 houses there. Good yields. A letting agent that knows his stuff and is a landlord himself with a 60 property portfolio, a nice guy I had a long chat with him the other day. Local employment is pretty good and there are a couple of major employers investing in the area.
So I'm thinking of buying 2 or 3 houses worth 65-75k (there is plenty of choice). All will produce an 8-10pc yield.
All will have IO mortgage on them. All will be held within an spv company. Letting agent said he vets the tenants properly and weeds out the ones most likely to not pay the rent. He has great success renting to Eastern Europeans who generally don't mess him around.
I'm 36. Want to hold them long term as part of retirement planning with my wife. The capital will be paid off using a LISAS which we've started building up.
The alternative is putting the 60k I've earmarked for this project into a ftse100 tracker. Which is kinda boring.
I have a civil service pension which has already used up 25pc of my lifetime allowance. My wife has a teachers pension. I don't have a mortgage on my house where I live and I want to retire in no later than 20 years time.
Can anyone talk me out of this ?
I've a couple of friends that have 3 or 4 houses there. Good yields. A letting agent that knows his stuff and is a landlord himself with a 60 property portfolio, a nice guy I had a long chat with him the other day. Local employment is pretty good and there are a couple of major employers investing in the area.
So I'm thinking of buying 2 or 3 houses worth 65-75k (there is plenty of choice). All will produce an 8-10pc yield.
All will have IO mortgage on them. All will be held within an spv company. Letting agent said he vets the tenants properly and weeds out the ones most likely to not pay the rent. He has great success renting to Eastern Europeans who generally don't mess him around.
I'm 36. Want to hold them long term as part of retirement planning with my wife. The capital will be paid off using a LISAS which we've started building up.
The alternative is putting the 60k I've earmarked for this project into a ftse100 tracker. Which is kinda boring.
I have a civil service pension which has already used up 25pc of my lifetime allowance. My wife has a teachers pension. I don't have a mortgage on my house where I live and I want to retire in no later than 20 years time.
Can anyone talk me out of this ?
Easternlight said:
Interesting thread, but even the OP admitted the house was a s
thouse in a rough area.Hull's OK generally.
Wacky Racer said:
Easternlight said:
Interesting thread, but even the OP admitted the house was a sthouse in a rough area.Hull's OK generally.
Wacky Racer said:
Easternlight said:
Interesting thread, but even the OP admitted the house was a sthouse in a rough area.Hull's OK generally.
thouse, the tenants made it a sthouse.It is a rough area though. Like parts of Hull, especially where houses are £60k.....
I've looked a couple properties in Hull and was put off.
Streets right next to each other with a significant difference in price and tenant profile.
I concluded without significant local knowledge it was a lottery.
I'd be very wary of anybody making out things were easy and until you are in the area there is now way you are being offered the premium deals
Streets right next to each other with a significant difference in price and tenant profile.
I concluded without significant local knowledge it was a lottery.
I'd be very wary of anybody making out things were easy and until you are in the area there is now way you are being offered the premium deals
princeperch said:
A letting agent that knows his stuff and is a landlord himself with a 60 property portfolio, a nice guy I had a long chat with him the other day.
Q: Why doesn't he buy these houses himself???A: Because his Management Fee gives a better, no risk return than owning houses.
Check the rental market very, very carefully. I grew up not far from Hull in a town where house prices were extremely low and still are.
They are so low in fact that virtually no one rents because even on min wage or doing farm work it's not hard to afford the mortgage. There's a real risk you end up with lots of short term tenants or worse still the type of tenant that you really don't want.
If you're sums genuinely work out as a solid investment with all expenses included I'll be amazed.
They are so low in fact that virtually no one rents because even on min wage or doing farm work it's not hard to afford the mortgage. There's a real risk you end up with lots of short term tenants or worse still the type of tenant that you really don't want.
If you're sums genuinely work out as a solid investment with all expenses included I'll be amazed.
princeperch said:
So I'm thinking of buying 2 or 3 houses worth 65-75k ......
The alternative is putting the 60k I've earmarked for this project into a ftse100 tracker. Which is kinda boring.
Struggling with the maths - is the £60k the deposit for the 2-3 ?The alternative is putting the 60k I've earmarked for this project into a ftse100 tracker. Which is kinda boring.
If I were going to invest in BTL, then that sort of area makes the most sense yield wise.
Carbon Sasquatch said:
Struggling with the maths - is the £60k the deposit for the 2-3 ?
If I were going to invest in BTL, then that sort of area makes the most sense yield wise.
Yes but excludes some of the entrance fees. If I were going to invest in BTL, then that sort of area makes the most sense yield wise.
The guy isn't buying anymore himself because he is in his late 50s and wants to make his life easier.
Having lived in the outskirts of Hull for 21 years, I would say it would depend on where abouts you are looking at. Like any area, there are places to avoid and without local knowledge you may unwittingly buy in the wrong area.
Not lived there for a while so don’t know if there have been any changes but as always location location location is key!
Not lived there for a while so don’t know if there have been any changes but as always location location location is key!
princeperch said:
Yes you read that right. Hull.
I've a couple of friends that have 3 or 4 houses there. Good yields. A letting agent that knows his stuff and is a landlord himself with a 60 property portfolio, a nice guy I had a long chat with him the other day. Local employment is pretty good and there are a couple of major employers investing in the area.
So I'm thinking of buying 2 or 3 houses worth 65-75k (there is plenty of choice). All will produce an 8-10pc yield.
All will have IO mortgage on them. All will be held within an spv company. Letting agent said he vets the tenants properly and weeds out the ones most likely to not pay the rent. He has great success renting to Eastern Europeans who generally don't mess him around.
I'm 36. Want to hold them long term as part of retirement planning with my wife. The capital will be paid off using a LISAS which we've started building up.
The alternative is putting the 60k I've earmarked for this project into a ftse100 tracker. Which is kinda boring.
I have a civil service pension which has already used up 25pc of my lifetime allowance. My wife has a teachers pension. I don't have a mortgage on my house where I live and I want to retire in no later than 20 years time.
Can anyone talk me out of this ?
Didn’t see that you are talking with a letting agent - that will help in the area aspect. I've a couple of friends that have 3 or 4 houses there. Good yields. A letting agent that knows his stuff and is a landlord himself with a 60 property portfolio, a nice guy I had a long chat with him the other day. Local employment is pretty good and there are a couple of major employers investing in the area.
So I'm thinking of buying 2 or 3 houses worth 65-75k (there is plenty of choice). All will produce an 8-10pc yield.
All will have IO mortgage on them. All will be held within an spv company. Letting agent said he vets the tenants properly and weeds out the ones most likely to not pay the rent. He has great success renting to Eastern Europeans who generally don't mess him around.
I'm 36. Want to hold them long term as part of retirement planning with my wife. The capital will be paid off using a LISAS which we've started building up.
The alternative is putting the 60k I've earmarked for this project into a ftse100 tracker. Which is kinda boring.
I have a civil service pension which has already used up 25pc of my lifetime allowance. My wife has a teachers pension. I don't have a mortgage on my house where I live and I want to retire in no later than 20 years time.
Can anyone talk me out of this ?
Be interested to know who the agent is- I have knowledge of a few of them in Hull
Dromedary66 said:
Exactly.
Also he will put the best tenants into his own properties.
O right! And I suppose when his crystal ball tells him a good tenant has come along he just tells one of the existing tenants in one of his properties to beat it and installs this new good tenant there instead! Also he will put the best tenants into his own properties.
And of course he does this continually - emptying and refilling his own properties by simply telling the existing tenants to do one - until his own properties are full with only 'best tenants' (unless of course the crystal ball tells him any new ones that come along are even better than the best ones)
"It's letting agency Jim, but not as we know it"
rockin said:
princeperch said:
A letting agent that knows his stuff and is a landlord himself with a 60 property portfolio, a nice guy I had a long chat with him the other day.
Q: Why doesn't he buy these houses himself???A: Because his Management Fee gives a better, no risk return than owning houses.
Or that he also thinks he'd prefer management fees to owner's profit despite owning 60 of the bleeders!
Still, at least we now know there's a 'no risk' way to make some better-than-owning money from btl!
Muzzer79 said:
Wacky Racer said:
Easternlight said:
Interesting thread, but even the OP admitted the house was a sthouse in a rough area.Hull's OK generally.
thouse, the tenants made it a sthouse.@pp....
It's a good idea to work out an exit strategy in case it all goes SO wrong you want out, including how much that'll cost and whether or not you're comfy with it. A 'worst case scenario' scenario.
Having got that rather unlikely possibility out of the way, here's what might be helpful:
If your 'nice guy' is a pro agent, he'll want you to do well so that a) you stick with him and b) you increase your stock with him (and even potentially via him). Attracting new landlords can be quite hard, to the point where agents even try to buy other agents - primarily to add stock. Don't underestimate this. For example, my agent will pay £500-£1000 PER UNIT for referrals of the right stock, and will offer professional landlords 3-6 months commission free management for bringing him their properties.
What is important is to know that he can manage exactly the type of properties that you are buying and in the area you're buying them in.
It's pretty obvious that where you're buying many/the majority/virtually all the properties will be letting concerns. So he should have stock in that area. Ask him if he does. And if he does, ask him to ask the owners if they'd mind him showing you their letting records.
Why wouldn't they? And if he goes along with that then you'll know pretty well exactly what your outcome is going to be.
None of that is unreasonable due diligence given that you're about to embark on a very costly project potentially worth a good deal of money to both you and him.
It's a good idea to work out an exit strategy in case it all goes SO wrong you want out, including how much that'll cost and whether or not you're comfy with it. A 'worst case scenario' scenario.
Having got that rather unlikely possibility out of the way, here's what might be helpful:
If your 'nice guy' is a pro agent, he'll want you to do well so that a) you stick with him and b) you increase your stock with him (and even potentially via him). Attracting new landlords can be quite hard, to the point where agents even try to buy other agents - primarily to add stock. Don't underestimate this. For example, my agent will pay £500-£1000 PER UNIT for referrals of the right stock, and will offer professional landlords 3-6 months commission free management for bringing him their properties.
What is important is to know that he can manage exactly the type of properties that you are buying and in the area you're buying them in.
It's pretty obvious that where you're buying many/the majority/virtually all the properties will be letting concerns. So he should have stock in that area. Ask him if he does. And if he does, ask him to ask the owners if they'd mind him showing you their letting records.
Why wouldn't they? And if he goes along with that then you'll know pretty well exactly what your outcome is going to be.
None of that is unreasonable due diligence given that you're about to embark on a very costly project potentially worth a good deal of money to both you and him.
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