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haf1963

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Everything posted by haf1963

  1. Yes - you have to make an offer via the auction house and and all normal auction conditions apply in terms as 'sold as seen', 4 weeks, 10% deposit etc. My expereince is that anything that looks like a low-offer will be immediaetly rejected - so its not really a good way to get BMV but can be good if you are after something very specific. Many sellers (eg councils) will not consider pre-auction offers at all
  2. my understanding was that permitted development is single story only so if you are building 2 storey then its automatically planning permission needed
  3. yes all my BTL have been refurb and most from auction so happy to answer questions directly or on this thread - by no means an expert though
  4. Have you got any skills and or contacts in the refurb space as the key to cussess is a reliable set oif people who will get the work done on tie and at a decent price. Assuming you ar enot going to do it all yourself. Secondly what degree of work are you prepared to do as the more value you add, the better the margin. A cosmetic flip is very different to a extension/loft-conversion. I assume you have worked out all the numbers factoring in tax/stamp-duty etc Exciting times so good luck
  5. I think your best bet is to go ahead and start some viewings and offers to get your first property. Once you have done that you will know a whole lot more about every aspect and you can then decide if the strategy is still a good one. As numerous people have said, the reality of doing a BTL from start to finish is very little like the theoretical model we come up with remotely. The main learning point for me was that the net income is pretty low - especially after LTD company costs have been factored in - so double check your figures. "Strategy: Buy a portfolio of 4 (maybe 5) freehold houses in Leeds around 1-2 miles from the city center. Purchases will all be in a LTD company I will need to setup. Have already found 4 houses on zoopla, each house goes for around 80-90k and rents at around 500pcm. Assuming asking price purchases, Gross yield at 7.25%, ROI at 8.3% (assuming 75% LTV and 20% written off the rent to take into account management fees, voids and ad hoc costs). This produces an annual net cash flow in the first year of £8.7k." My experience is that you are being a bit optimisitic with 8.7k net given 4% mortgage rates for LTD and accountancy fees, insurance and various other bills. I would think 6-7k is more realistic. I would also factor in that its unlikely these 80-90k properties meet the regulations for letting so expect some upfront costs as well. As I said at the start of this reply - your best bet is to go and buy 1 and get it rented out - only then will you know the true figures. Exciting times for you and good luck with the venture
  6. Or set up a Ltd company as joint shareholders and pay her a salary
  7. Yes - he can 'gift' you the money and then you put it in the LTD as a 'directors loan'.
  8. Its good to diversify so having a combination of property/investments is the best option if affordable. I maxed out my pension (or close to) and then went BTL. In terms of effort/risk/hassle/returns etc then the stock markets have delivered better growth with less effort for me over last 4-5 years than the BTLs - but BTLs are a longer term bet. Having got to 5 BTL I am now siwtiching back to stocks via various means
  9. This is a super complex questoin with too many variables to give a straight answer. As a start lets assume yopu get 10 properties at 150k each giving 700 minimum in rent (numbers work in the midlands so could be better in liverpool etc). at 40k per properties for deposit and expenses then you are looking at 10 properties. Assuming each one has a 50% mortgage interest cost and 10% management plus 10% buffer then you are looking at 30% return so 200 per house i.e 2000 per month for all 10. The 10 properties would have cost you 400,000. There are a huge amount of factors not considered eg - unlikley you will get 10 mortgages, - tax implications depending on personal versus LTD plus a load of other things Then there are options like HMO or buying blocks of flats and many others so you really need a lot more advise than this forum to be honest. The numbers above are so rough that I would not be making decisions on them for sure. You could probbaly double the 2k per month by doing this differently - but those will bring you into different challenges
  10. 10k is not unreasonable given the work involved. I tend to do a full refurb that costs 20k inc rewire/heating/etc but no roofing work. I am not sure the externals need insulation boards and rendering Also i assume that your proerty is the one in the middle of the last photo rather than the one who's garden the photo is taken from.
  11. Not an expert but I don't see an issue with this.. On option 1, it will be down to the mortgage valuer to agree that the property is worth the extra money so if 'next door' is 125k then you should be ok. Obvioulsy the person selling the property to you will have a good reason to sell cheap so that may help convince the valuer. On your option 2 then i will be surprised if you can buy/rennovate/sell in less than 6 months anyway as th esolictor side is guaranteed to slow things down - especially when a mortgage is involved. Also depends if the buyer is using a broker as it is possible to get mortgages inside 6 months.
  12. I have heard good things about sheffield and its a few years behind nottingham in the cycle - with my limited knowledge. Both good choices but also have good/bad areas so plenty of research and maybe some local knowledge needed. I came across some good sheffield property forums where local investors gave comments so worth tracking some of them down as well. Good luck and the key will be to get started as I spent/wasted an antire year looking for the 'perfect' deal - which doesn't exist and if it does then there are plenty of cash buyeres ahead of you..
  13. HMO is indeed more difficult to manage but do-able with help or good agent. I would not look atr students at all but working professionals and am specing my hmo high with onsuites etc to attract them. If you are in no rush to get money out of the Ltd then its a good way to proceed. I have no clue about Leeds so of you think your areas have strong potential then thats fair enough. Ultimately you have toi actually get going at some point and then you will be a lot wiser after the first purchase - good or bad - so maybe if yopu think your orginal stratgey is reasona bl ethen get your first proeprty done and then re-evaluate. As many others have said, the reality is usually different to the theory and no-one can really give you any guarantees about which area/strategy will work best for you I have learnt a huge amount about tax/ltd/regulation/planning and all sorts along the way and my BRR stratgey worked out reasonablly well so far - though real income levels have been lower than expected.
  14. I am assuming you have though through the tax implications to see if the num bers stack up. Getting income out of LTD is not easy (as i have found) so this really needs to be thought through before execution of the strategy. I would be nervous about a LTD strategy for 2-3 properties only as its very likely the income will be very much reduced after mortgage costs, capital gains tax, paying an accountant etc. After 5 years (and 5 properties) I am doing my first HMO as the income from traditional BTL in a LTD is really not sufficient to give up the day job. As a long term pension investment then thats another story. As I said in another post, starting out in property today is very different to 10 years ago and needs lots more thought - especially from a tax/regulation perspective.. Don't let this put you off but do think through all the angles.
  15. I don't know leeds that well but this stratgey sounds like you are going for the bottom end of the market in terms of quality of housing and tenants. As a income strategy it has some merit but I am doubtful you will get strong growth in these sorts of areas any time soon. Rather than voids I would be worried about evictions and the cost of these is much higher. I looked into a similar strategy in the midlands and after 1 property, i switched to the a better area with better tenants which meant going from 100k to 150k properties. I am now glad i did as have had decent growth as well as reliable tenants. Good luck but as others have said you need to think it through very carefully.
  16. I also looked into it a couple of times and decided it was high risk and expensive so went down a different path of getting loans via other people I know. Obvioulsy if its the only way to move forward and the costs can be factored in, then its workable.
  17. I should have clarified by saying 'from an income perspective' more than capital gains and also it does depend on what level of return is deemed 'successful'. It also depends on what your goals are and your existing tax position If you bought traditional BTL in a reasonable area with a mortgage and rented out then its likely the gross income is 6-7% and probably 50% of that is the mortgage payment - given its likely you have a ltd company due to tax rules. To get a decent income you will need 5-10 properties or go down the increasingly difficult HMO route. Then there are the problems assciated with getting your money out of the ltd company due to more tax implications. There there is all the regulation stuff to keep track off. Obviously the big payoff wil be after good price growth over time but thats not a guarantee either. Don't get me wrong in that I am doing ok (after 5 years) with a small portfolio including a hmo but my point is that property is much harder now than it ever was and if i look at my pension investments with tax relief over the same timeframe then I have done pretty well. It would be a different story if i wasn't close to retirement or if i was looking to 'leave a legacy'. I guess my point is that we are no longer in an environment where 'you can't go wrong with property' and its often teh 'default' choice for people to one where you need to think a lot more carefully about all thats involved and what you are trying to achieve. In 5 more years when i decide to sell up, it will be interesting to see what my net profit is from the portfolio. I am still glad I did it (for diversification) but its been a lot more effort than i exepected given returns so far.
  18. I would add that if you are looking at a 5-10 year time frame then property may not be the place to invest - for the reasons above
  19. Not sure much will happen for a few months but with all the commitments to infrastructure spending/house building etc it does look like things will get better in the housing market through 2020 - a 'boom' is another question...
  20. Just bringing back this topic and owndertinf anyone has tried to get a refund for a uninhabitable property. I wrote to SDLT office and it took them over 4 months to reply to me and say 'unable to comment as sdlt already paid' and to call them to discuss. In parallel i was advised to contact Primas Law as they have setup a task-id and team for this purpose so I have now contacted them and see what they say.
  21. My experience over past 3 years via acutions is that in west mids is that there are no backdated charges but there are also no discounts for unoccupied or even un-inhabitable.
  22. Yes a couple of hundred is about right but they will not ge giving you any guarantees given that the legal pack is more than likley going to be missing things. Its very rare for a property to come to auction if everything about it is 100% tip-top shape. Mine does it for free as i have used him to buy a few properties but i tend to review most of it myself and he has a quick-ish scan to see if he can spot anything obvious.
  23. I am finding the ltd company is not so great if you want to exit and not leave an inheritance...
  24. there was a discussion on this earlier which may be helpful..
  25. Releasing equity via. a remortgage is fine and you can do what you like with it inside the company. Releasing equity by selling a property is a different matter as its capital gains so fully tax-able
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