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Same End Result But With Less Houses?


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Hey,

Time poor investor with a £100K starting pot - looking to invest for modest cashflow, with an eye on capital growth. BRR strategy identified to scale quicker.

Found many deals on properties around £50K PP, that provide ROCE (post refinance) of approx 15-20% and net cashflow around £200/250 pcm. Calculated I can roughly buy 8 properties with my capital pot over approx 4 year period. This provides around £20K ROI p/a on my £100K capital starting pot (excluding any capital growth gains in the longer term).

Question - Is there a BTL strategy out there that achieves the same sort of end result, but with less houses to manage?
(Wondering if particular value properties have a different effect or any other variations of the BRR/BTL models I should research?)

Note: Not interested in HMOs as much less passive and led to believe not so favourable for long term capital growth.

Thanks for any pointers guys!

 

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Hi Tomo - in my experience the lower the value of the property the higher the yield so to maximise yield you're going to need to buy at the cheaper end of the market. Maximising yield means maximising cash flow.

However we have used serviced accommodation to match and better the yields available in cheap housing but pulling all the money out of the deal is much more difficult. In prime locations, with high occupancy, you usually have to pay a premium for property (unless you get in very early) and in a competitive marketplace BRR becomes harder to do.

We have serviced accommodation units that cost £210k forecasted to yield at 8% but if refinanced most would have a decent whack left in the deal 20-30k min. So you can hold less properties this way but you need more capital.  Check out deal two on this page for some numbers.

There are definitely ways to get similar yields from higher value properties but it's not as easy to get all the money out of these kinds of investments in my experience.

Maybe others disagree? I'd be very interested to hear if anyone is doing full BRR in higher priced properties on a regular basis.

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