ayns got a reaction from Mark Rocks in I thought £100k would be enough to move things on a bit.
The area where I have been planning to invest is super hot, has been for about 12 months and personally I think with all the investment into my specific area, plus the Midlands in general, its just going to get worse.
I have a 2 bed that gives me about 385 net that I have re-financed and recently refurbed, and I am progressing a purchase on a £145k 3 bed property that should yield me £400 pcm net which needs a very light refurb (£3k).
Problem is, I was hoping to get together 4 properties in the next 9-12 months, but based on what things are going for locally here it could be a stretch and just unrealistic as I dont have the time 24/7 to be working on getting those BMV. I'm also keen to try and grow my pot over time and obviously paying market rate with minimal option to add value except through capital gain well it could take me years!
Has anyone recently changed their investment area based on the returns / their investment amount? My eyes are wandering towards the dizzy heights of doncaster and also the north west where prices are still unbelievable cheap and the ROI looks enticing, also surely with the levelling up those areas are bound to see capital growth long term.
Obviously in those areas I would also be more hands off investing, using a local agent etc. Doncaster is about an hour and well greater manchester for example is upwards of a couple of hours!
Do you chase the higher ROI in the much cheaper areas and go more high volume, or make much fewer purchases but in an area with robust capital gain options but takes you "unit growth" at a slower pace.
ayns got a reaction from antoineg in Advice on a potential deal
i go interest only like most investors, gives you the option to either a) save for further deposits b) pay the money into another yielding instrument (ISA/stocks etc) and the end of the year once tax / costs have all been paid out. I have run capital repayment before and found it tricky to manage maintenance etc with the margin and once you've paid that money, its not coming back the next month if you need it. Plus your debt gets eroded over the years thanks to inflation anyway.
I dont estimate, I get quotes so I know the actual costs. Get three firms , get them to give you a quote which they will itemise for you, then you can just amend slightly for different levels of stamp duty, the other fees are largely fixed.
If you dont have a basic calculation already then do it, makes a huge difference in your mindset. For me I'm buying and holding, people get infatuated in getting a "deal", which does matter if you are wanting to add value, BRR, flip, re-finance shortterm etc. Actually when you run the numbers its small fry if you are buying and renting on the side like me . I up'd a bid I had made by 5k to the asking price because it stood up, I was nervous about it and the whole over paying scenario, when I put in through the calculator it cost me an extra 1400 in deposit and stamp duty, plus only £10 per month on the mortgage, property will rent for £735 pcm, so pretty sure in 5 years time I wont be concerned about the extra investment
ayns got a reaction from horne-properties in HOT Market- I think I may becoming impatient
Good skills. I’ve too made a decision to up an offer I had made by a few grand to get a property. Re-capped the numbers and the reasons why it’s a great purchase and went for it. As has been said above, either do and get on with it or wait, both come with risk, but I’ve never been the “what if type”.
ayns got a reaction from johnh in Advice on a potential deal
Obviously know nothing about the property, 1 bed/2bed house / flat etc, however that yield does seem quite low. I've just rented a property of mine with a value of £115 and its gone for £650 pcm. Also, this is obviously a personal thing, but i look at net yield , what would be net yield be? Yes capital gain is a consideration in the medium / long term, however I cost all my investments based on ROI and factor in minimal capital gain, the weekly rental is much more guaranteed and it'll be a combination of saving that rent and re-financing that lead to buying future places..unless you are doing BRR.
FYI my purchasing calcs look like this for an offer I have in atm :
Tax is low as using my wifes allowance and maintenance is also quite low as the property is in great shape so I've allocated for a few plumbing visits etc but nothing major, my other properties have much more built in for maintenance as they are older
ayns got a reaction from horne-properties in HOT Market- I think I may becoming impatient
I’ve had similar experiences. Just started viewing the last 4 weeks and hoping to get a deal done this week following an offer I’ve made. Personally I’ve taken the view of what it is worth to me. I’ve offered asking price on something that will net me £5k pa, although to be honest if they wanted £5k over I’d bid it costs me an extra but in deposit but the opportunity cost of missing out is greater.
if you’ve been missing out for 12 months, I’d go back and look at how much those early day properties are worth now 12 months on, that’ll help you put more competitive bids together.
depends on your strategy but I’m on steady build over 10 years +, unlikely in 10-15 years I’ll regret paying an extra £10 for a house
ayns got a reaction from horne-properties in How to avoid overpaying in a heavy "guide price" market
Where I am investing the market is bonkers, talking all viewings gone within 12 hours of a property going out to market and some mad price increases being banded around. Im in the east midlands, just missed out (luckily you may say) on a property thats gone for £160k , 2 bed, had 5 offers on the table, which means its gone up 60% i the last 2.5 years from 105 and went for nearly 10k over the guide price of £150k . Its happening all over the place and everythings getting listed with a guide.
The city I am in is an area where strong rental demand exists however historically properties have been responsible meaning you can easily get 10%+ net ROI, guess thats catching on now post covid.
I have resided to the fact I'm going to have to offer on 15-20 houses before getting a deal I want and am working the agents hard to get viewings booked in before the properties hit rightmove for example and they get hammered with interest.
Is anyone else experiencing this and how are you making peace with yourself that what you are paying makes sense? I am investing at purchase price between £115-£160k which i guess is prime for people listing to take advantage of the SD holiday to move up the ladder, but alot of these places sold say 3 years ago for much less and not all being full refurbs / previous off market sales. These places however are selling within days at times.
I am happy with my ROI numbers when I run the numbers based on the rental amounts that i sense check with a local agent , and was happy to get out bid on the last one. I have a long term view on property and I am buying and holding, however I also have concerns about under valuation if the local market has taken such a huge leap in the last 12-18 months that transactions havent quite caught up?
how is everyone else finding it?? i'm feeling bullish about taking action, however I dont know if thats a case of knowing I need to and in 10 years time I wont regret it or blind stupidity following the crowd 😂
ayns got a reaction from lukel in Over whelmed and need advice
Also mate, depending on your strategy, but people get really hung up (me included) on time to buy, should I shouldn’t I etc. If it’s a good area and the numbers add up for either cashflow or capital growth you will rarely regret buying somewhere, you can always change that decision in the future by selling or re- financing, If you never buy, you can never get back that time that you have lost. Even if you did a flip and couldn’t realise you re-finance straight away for example, there’s always silver linings in that you could rent it for 12-18 months , again yes wouldn’t have flipped it straight away but even though things didn’t go to plan, your still further on than you were.
the first one is always the best as it’s where you learn loads in good and bad situations from it!
ayns got a reaction from david slater in Buying though ltd company now or later?
Thanks David. Indeed, guess all circumstances are different as well. At the beginning of my journey (with young kids / wife part time etc) I’d prob like to be able to have access to that cash quickly if life circumstances changed, my idea was then after the 3 - 4 cash flowing properties I would then be very happy to leave all funds circulating in a LTD company for reinvestment and therefore not “double dipping” on corporation and income tax and maybe in later life then drop those profits into a pension if I wasn’t buying anymore. That was / is the plan anyway!
ayns got a reaction from hmehta in How easy is it to remortgage
Hi , I have re financed recently and must say I got a much better deal by shopping around than what my existing lender could give me, mainly due to then not giving a good enough valuation of the property in comparison to a new lender. i also wanted to switch to interest only which my existing lender wasnt happy with.
Find a great broker and they sort it out seamlessly, I used https://www.veracityfp.co.uk/our-team/mandy-waby-mortgage-adviser and she came recommended , brilliant service and will be working with her again for sure.
ayns got a reaction from horne-properties in Is BRR out if the question for the foreseeable?
Tough, as has already been said getting a bmv purchase will be no easier or harder, competition is also high. As has already been mentioned, getting cash out the deal could be tricky so I’d shy away from any real short term bridging options unless it was an unbelievable bmv deal. You can always flex your strategy though, why not find something that needs light refurb or non all , and cash in some yeild on a 2 year fixed? Depending on where you are buying location wise , prices will likely have ticked up by then and you’ll have cash in the bank plus if you can save privately as well then great. Don’t hang around forever waiting for the perfect deal , if may never come and you will be losing out every month in the meantime.
ayns got a reaction from steve brown in Who else is holding on purchases until mid 2021?
fair comment, a good deal is a good deal I suppose. I guess I'm at the beginning of my property journey (1 x BTL down) and just nervous of making the wrong move. I do know the area really well that I am focusing on so just need to focus on my numbers and if something falls within that and it adds up now, cant think of a logical reason to wait from thinking more about it! I'm on a rough 10 year plan so income so hopefully any changes would be short term and it'll still pay off long term
ayns got a reaction from helen court in Borrow money for coronavirus driven investments?
Thanks..I was thing more personal loan to stash away rather than a re-mortgage as I would be hesitant to be too heavily leveraged during a time of change. was talking to someone the other day about personal borrowing, I can get a great interest rate deal with very low early repayment charges if I just wanted to give the money back in 6 months if no opportunities became available.