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What do you think of this strategy with £200,000 cash?


twojays

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Hello, 

I'm hoping someone can give me some advice with a strategy to use or possibly a similar experience to make my decision a bit easier. 

I've got £200,000 to invest in property and these are my goals.

- Build a BTL portfolio to a £5000 monthly passive income level. 

- I would like all of my BTL properties to be appreciating assets with good levels of capital growth for the future. 

I've been advised on the below strategy  but would just like to open up the discussion to see if anyone has any recommendations or comments. 

 - Use £100,000 to purchase 2 BTL Mortgaged properties (£50,000 deposit each)

- Rent each of those out at £900 pcm, deducting mortgage costs and maintenance (Leaving £210 pcm) x 2  £420pcm

- Using the remaining £100,000, purchase two renovation projects with bridging finance and renovate. 

- Sell both projects and repay the bridging finance. Add profits from flips to cash pot. 

- Keep repeating this process with a larger cash pot each time until I reach over the £200,000 cash pot position again.

- Purchase another 2 BTL properties with £100,000 (£50,000 deposit each) Rent those out the same as the first two. £420pcm. 

- Repeat the steps with flips, adding more to the cash pot each time, eventually I'll be able to do larger more profitable flips and it would start to be beneficial to move onto Bridge-to-Let to make the process quicker with lenders. 

- I would repeat this process on a cycle for 5 years to reach my goals.

I like the idea of this strategy, but I could be being totally naive to the whole thing, I understand that bridging loans aren't to be taken lightly or by anyone without the experience. 

I'm curious to see if anyone has any strategy that would be better suited to my situation and if anyone thinks i'd reach my goals using this strategy. I know it totally depends on the area and house type etc but I'm trying to gather as much knowledge as possible so I can make an educated decision. 

Thank you for your time, its good to be a part of the PH family.

Georgia (twojays property) 

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