Jump to content

Potential First Deal


Recommended Posts

Hi all, 

I’m a brand new to property investment having decided to use some inheritance to start our portfolio. I’ve had an offer accepted and wondered if I put some basics on here if somebody would be able to critique for me? I’m not looking for anything amazing, just a solid first step. 

The property is virtually ready to rent, just a new carpet in the hall and a lick of paint. 

 

The numbers are;

PP £95,000

Rent £500-550pcm

Management 12%+VAT

SDLT £2850

 

Recent sold on the same street are exactly the same, 2 x £95,000 this year. 

 

Based on a 3% interest only mortgage of 75%LTV, cash flow is £200/month. It passes the lenders stress test with just £30 to spare and would just cash flow at 6% mortgage. 

 

I’d really appreciate a little advice on if we should follow through or keep looking. 

 

Thank you!

19787DA0-11E0-4ABF-AB23-622125A15601.jpeg

Link to post

Congratulations on your first BTL Offer accept! A solid step in the right direction of property investment

The numbers stack. What I like about mortgage stress tests are that the banks are doing most of the risk analysis for me.

The purchase price is very affordable which is delivering a solid yield. But one thing to maybe consider is rental demand and the type of tenant you target. Demand tends to push rents up and the opposite is also true
Although your yields are strong, if your boiler packed up, then your profits for the year would quickly disappear. Same goes if you get a bad tenant or void periods. 

I would continue with the sale but always keep an eye out for a plan B or a better deal

Best of luck on your journey 

 

Feel free to add me on Linkedin;   https://uk.linkedin.com/in/dkidd

Link to post

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...