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jc27

Property Development - Future Career

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Evening All,

I have only recently come across this forum and thought I would create an account. I've always had an interest in property and in the back of my mind always had an ambition, eventually, to leave my job and work on property development full time. I was hoping to ask for some advice based on the information below from others more experienced than me in this area.

I've had a BTL property in the South East for approximately 5 years now. I don't owe too much on it and it's value has shot up since I bought it, which I estimate would leave me with 110-120k in total profit if I were to sell it.

The BTL property pays itself, I've had a variation of tenants over the years but the rent is always there. Occasional boiler breaks etc.. I have a dedicated plumber, builder and sparky who do the jobs for me at a good rate.

I've debated for as long as I've had the BTL property to keep investing and buying property but over the years I've come to realise that I would never be in a position where I could physically save enough money to outright apply for another mortgage on another property. Quite simply, my full time job doesn't pay enough. So I'm left in this predicament...

 

Do I just continue to keep the BTL property, it's a constant stable income which although low is mortgage free with the rent received.

Or..

Consider selling the property and investing in another property to renovate and sell on for hopefully, a profit. I'm hoping in doing this it would set me on the right path to keep buying more till I reach that ambition in the back of my mind.

Cheers,

JC

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Pull the money out of your BTL up to 75% ltv and buy another investment, no point in having £120k just sat there when you could spread it across another 2 investment properties especially given where we are in the cycle. Good opportunity to get deals now if you can, then will be some serious growth for 4-5 years so why not benefit from capital gain across 3 properties rather than 1. Plus you will still get the monthly income having them on interest only.  No prize for being mortgage free if you can use "good debt"

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Hi JC

I would agree with ayns, that a good approach could be to remortgage you property and then use the released equity to invest in further buy to let properties.

in your post you mention profit of c£110-£120k, but is that the current value over the price you paid for it? Or is that the equity that you have in the property now? In the remortgage scenario it will be the amount of equity that you can release from the property that will be key to your opportunities for future investment. As ayns says you can release 75% possibly 80% (probably not during the lockdown though) of current property value which could give you enough for one or more deposits on further properties.

The other benefit of additional investments in the long term is leverage or more specifically capital growth on leveraged investments.

In your post you question whether best to buy renovate and sell on, I think this comes down to your goals as this will differ for each individual and their circumstances, there is some really great stuff in the free education section on this website around goal setting which then leads you on to the best strategies to adopt to achieve those goals plus lots of other information on these topics on various other sites.

Hope this helps and let us know what you decide and how you get on.

regards

Gary

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On 3/25/2020 at 4:42 PM, ayns said:

Pull the money out of your BTL up to 75% ltv and buy another investment, no point in having £120k just sat there when you could spread it across another 2 investment properties especially given where we are in the cycle. Good opportunity to get deals now if you can, then will be some serious growth for 4-5 years so why not benefit from capital gain across 3 properties rather than 1. Plus you will still get the monthly income having them on interest only.  No prize for being mortgage free if you can use "good debt"

Hi Ayns,


Thanks for your post. That's exactly what I was considering doing. I also think after the pandemic the market will only continue to grow. One thing I didn't realise is you can't obtain a mortgage on a property you intend to flip, or it's doubtful a lender will consider it.

On 3/28/2020 at 12:19 AM, gary-n said:

Hi JC

I would agree with ayns, that a good approach could be to remortgage you property and then use the released equity to invest in further buy to let properties.

in your post you mention profit of c£110-£120k, but is that the current value over the price you paid for it? Or is that the equity that you have in the property now? In the remortgage scenario it will be the amount of equity that you can release from the property that will be key to your opportunities for future investment. As ayns says you can release 75% possibly 80% (probably not during the lockdown though) of current property value which could give you enough for one or more deposits on further properties.

The other benefit of additional investments in the long term is leverage or more specifically capital growth on leveraged investments.

In your post you question whether best to buy renovate and sell on, I think this comes down to your goals as this will differ for each individual and their circumstances, there is some really great stuff in the free education section on this website around goal setting which then leads you on to the best strategies to adopt to achieve those goals plus lots of other information on these topics on various other sites.

Hope this helps and let us know what you decide and how you get on.

regards

Gary

Hi Gary,

 I need to have a valuation done officially but unofficially there's about 120k in equity there. I owe 82k on the mortgage give or take and it's worth about 210-215k. I would have enough for deposit on a lower price property, however I'm still searching around on whats best to buy and where..(estate agents/auction etc..)

I have already started watching the videos in the free education section and I find them brilliant. Really beneficial. I would prefer to 'flip a property' over another BTL but reading the amount of work that goes into is frightening!

I would have to obtain a bridging loan which I'm only just reading up on. I find the biggest risk is knowing you can sell the property for a good price after buying and investing in it. Either way it'll require extensive research.

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