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Critique my portfolio - advice welcomed

Which option would you choose?  

15 members have voted

  1. 1. Which strategy should I go with?

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Hello all,


I'm looking for some advice, I'm 25 and I've currently got a portfolio of 3 properties. My strategy this year was to carry on buying, but after having a meeting with my accountant he said perhaps it's worth me slowing down to see what changes brexit could bring. Everyone seems to have slowed down and I personally think this is a great time to try and take advantage of a slower market. Anyway, below is my current portfolio, if you need any further info please drop me a message - 


Property 1 

Purchased for £214,750

Outstanding mortgage £140,000

Current value £250-£260

Net PCM - £525


Property 2

Purchased for £92,500

Outstanding mortgage £75,500 (Have refinanced)

Current value £100,00

Net PCM - £226


Property 3

Purchased for £92,500

Outstanding mortgage £69,375

Current value £100,000

Net PCM - £330


My plan was to remortgage property 1 and pull some equity out to buy a further 1 or 2 investment properties. I've worked really hard to build this portfolio and I don't want to ruin it all by putting a foot wrong somewhere. I could potentially pull 50k out of property 1 and add it to my savings, to have a total of £100k ready to put towards new investments. Do you think I'm over leveraged? Do you think my strategy has holes in it? I would love to hear other investors opinions. 

I'm not in a massively high paying job, I earn over £25k but under £40k. I still live with my parents (believe it or not!) so my outgoings are fairly minimal, giving me a good chance to save as much as I can. 

There are 4 main strategies I see as options - 

1 - Buy 3/4 £60-£80k at 75% LTV properties up north, Manchester, Sheffield, Liverpool etc, this should cashflow around £1000-£1200 PCM. I would also expect to see some good capital growth here

2 - Buy 1 HMO property for £250-£300k at 75% LTV, this should also cashflow a similar amount

3 - Pull out a smaller amount of equity from property 1 and fix it on a 5 year deal. Add this money to my savings and put down a 35% deposit on a property, this should make about £675-£750 PCM. Purchase the new property on a 5 year fix and then aggressively pay the property down by £7500PA for 5 years to reduce my overall debt

4 - Fix Property 1 on a 5 year deal, sit tight and do nothing. This is the answer I fear the most, although I want to play things safe and not put a foot wrong, I also understand that to develop myself financially I need to take a certain amount of risk to increase my earnings. 


I'm currently on option 3, as it increases my cashflow and also mitigates risk as much as possible.


Which one would you choose and why?


I welcome any advice and opinions from other investors.


Thanks for reading.



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Hey James

Well done and congrats for building such a solid base! You've done well so far, so just keep at it. There's nothing wrong with just continuing doing what you've already been doing. 

With regards to the portfolio and next steps, it really depends on your goals and risk profile. Areas like Manchester, Sheffield and Liverpool are huge areas with vastly different postcodes and streets. On the HMO side, how much time/patience do you have to manage (or pay someone to manage) it? What are you trying to achieve and what is your target market? As you're still young and have a good working life ahead in terms of years, you can probably take a bit more risk. 

Without knowing the ownership of your current properties, if they're held in your personal name, then you might be creeping up to the higher tax bracket depending on your borrowing. If you do fund another purchase, maybe chat to your accountant about the potential of owning it in a limited company (especially if you are planning to purchase more). The downside to this though would be if you're needing to take an income from it to sustain your living needs, taxed at a higher rate.

If you're concerned about a downturn, ensure you have enough cash buffer at hand to meet any shortfalls and maintenance/repairs. But if you're planning to hold the properties long-term, then it shouldn't really impact you as rents should hold (depending on where the properties are and the local demand - e.g. they're not next to the Nissan factory in Sunderland or something).

As the market slows down a little, it's a good opportunity to pick up some, especially from other landlords that are now realising the tax hit from S24 and want to sell out. 

For what it's worth, if it was me, I would perhaps do a mix of what you've mentioned.  Drawdown some equity, keep some as a cash reserve in case things do really hit the fan (then you can snap up the bargains). Then invest the other portion in one or two BTLs in the NW, or perhaps if you want to try something different, maybe start off with a small mini-mo and see how that goes. I'd have a review of my goals and risk profile, chat with the accountant, mortgage broker and agents and take it from there.

Best of luck and keep up the great work!

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Hi James,

You seem like you have a good balance of risk, which is a positive. Personally what me and my wife have done is calculate the amount of money we would need for 6 months if the following events happened:

  • We both lost our jobs (calculate monthly costs just to survive)
  • All of our properties were empty (no tenants for income)
  • We still had to pay the current BTL mortgages
  • Plus all other costs to keep you in the black.

We took this figure and invested it into premium bonds. Yes its low yielding but your money is safe and you have the chance of winning prizes (we have won 3 times already).

This means that no matter what happens we have 6 months of funds to keep us going, and lets be honest the chance of all these events happening at the same time are slim.

You can then invest freely in property knowing that you have a fixed lump sum which you can withdraw immediately to keep you afloat.

Regarding options I voted for number 3, however i would maximise what you can take out of the property, on a 5 year deal, put the cash sum you calculate into premium bonds and invest with the rest. If the worst happens you will always be safe if you have enough cash to avoid having to sell.

Just as another tip, what would you rather have, £50,000 in the bank or safe £100 per month on your mortgage? Cash is always the life saver so whilst it might seem like a good idea to overpay a mortgage you cant get your hands on that money until you re-mortgage.



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Hi James,

Great post and congratulations on a very successful portfolio, and at the age of 25 it’s great to see that there are young investor out there.

 I understand not wanting to take the wrong foot but you sound like you know what you are doing. You have thought about what you can potentially do and are wanting to do something with it which is the first step. I think you are a successful investor and have a good head on them shoulders. Do what is best for you and what you want and I’m positive you will succeed in you next venture. 

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Evening all,

Thanks for the advice and opinions on this post.

I thought I would let you know what I've ended up doing short term - I've decided to lock into a 5 year fixed rate at 2.09%, not pulling any equity out. The lender is a provider who is open to offering additional finance after 6 months, this gives me the options I need should I want to use that money at some point in the future.

In the meantime, I'm going to continue to keep an eye on the market and grow my cash pot. There's no harm in slowing down, reevaluating things and then moving on. As a lot of you have stated, time is on my side, so I'm just going to see what happens over the next 6 months.

Thanks again,


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