Hello from Paul

[Paul Whalley]

Hi my name is Paul and I am 26 living in Sheffield. My interest in property started after reading 'Money for nothing and my property for free' about 4 years ago. Since then I have been working on securing a decent reliable income so that I can lend money to buy (previously survived on money made from poker which the banks obviously don't like). It's been a long slow process but I am now a qualified mental health nurse eager to get started. I was recommended the property hub about 5 months ago (weirdly whilst playing poker lol) and have been listening to the podcasts regularly ever since.

 

I am aware that the book that sparked my interest is probably dated but the buy and hold strategy is still the way I want to go. I am basically on this to get advice from knowledgeable people (rather than the usual people who have bought a house and suddenly now experts - or a financial adviser who isn't financially secure himself ) and stay update with the latest strategies people are using. I am not interested in selling or flipping properties any properties that need work doing to them will be done by the professionals.

 

I am currently in the process of buying my first house which is where my first question has come from:

 

Should I go for a 90% mortgage or a 95% mortgage? (Money is not a problem purely strategy) 25 years? or 35 years?. This will be my base for 2-3 years.

 

All advice given to me at this point is.... 'if you can afford go with 90 percent and 25 years' because you pay less in the long run.

 

However my instinct is telling me that because I will never be selling the property (and never paying off the mortgage) and i intend to rent it out within 2-4 years I should be putting down as little as possible to maintain cash flow and reducing the time for me to be able to buy another. Or because this one will be mine to live in would it be better to put a bigger deposit down just for this one?

 

Thanks,

 

Paul

 

 

 

 

[PaulDeehan]

Hi Paul.

 

I'm Paul from Sheffield too, ;-)

I would recommend putting 10% down and LTV of 90%, It doesn't really matter, just look at the best apr rate you are happy with a get going. 

Which APR rate etc would allow you to save for another BTL? 

 

A few years ago I got a rate of 4.44% and could have got a better rate if I put more money down, it's a choice your happy with. For me I've been paying down my personal mortgage so it would have been wiser to have paid a little more at the beginning for a better interest rate. 

 

You say you'll be renting it out. Will your mortgage be cash flow positive from future rent including other possible fee's like letting agents, maintenance, etc?

 

All the best with your decisions. 

 

[Paul Whalley]

Thanks for the reply!

 

I actually got an offer accepted on a property shortly before and, for some reason, didnt want to jinx the deal by talking about it untill now haha so apologies for the delay (I won't be as excited on my second!) Really happy with the deal because in my opinion it is roughly 20% bmv.

 

I understood what you said about the 10 percent deposit but I was looking at it from the perspective of putting in as little of my own money as possible. I did go with that in the end anyway. To be honest the main reason was because the 95% deals were far harder to get and the advice was for a quick sale was to choose 90%. Aswell as this I have since learned more about the difficulties of remortgaging before the end of the product term (2 years). So it looks like I won't be taking the money out until then anyway which definitely sways the argument in the direction you were saying.

 

My plan now is to decorate the property and get a friend renting a room as soon as possible. I will be hopeful of being in a position to look for another by December.

 

Where about in Sheffield have you invested? Have you bought in other cities? Do you look for long term growth or high rental returns?? 

[PaulDeehan]

Hi Paul, Congrats on your purchase.

 

I invest currently just in Sheffield, high yielding or I like to say higher ROI cashflow BTL's is what I've been buying. I'm looking to in the future do some capital growth properties, In the process on saving. 

 

I've invested in ex-local authority areas where the numbers work and areas I know. 

 

Cheers

 

[Joshua McGuinness]

Hey Both Pauls,

 

I've read this post with interest as I am looking at investing in Sheffield, and can certainly relate. I've got enough saved now for a deposit, and I am meeting with some brokers this week to arrange a mortgage.

 

I work for a property developer specialising in student accommodation on a national level. I am a chartered project management surveyor with the RICS. So, I have plenty of relevant experience in developments with GDV's ranging from £1m up to over £100m. Currently, I am managing two projects in Sheffield due to complete in September 2017. One a 63 bed studio apartment development, and the other 130 bed development of studios and cluster apartments.

 

It would be great to chat to either of you about your portfolios, even if nothing else, it just serves as an interesting chat.

 

Cheers,

 

Josh

[Paul Whalley]

Hi Paul,

 

How have you been getting on? I went to a course with Samuel Leeds a few months back who was promoting your strategy of high yielding properties for cash flow and financial freedom. I have recently bought one in Rotherham but find Sheffield fairly expensive. Are there any go to areas that you look at? I was itold that it would be impossible to get a mortgage in some of the cheaper areas, because they are so saturated with buy to lets. Have you any experience of that?

 

cheers

[Kitty101]

HI Paul

I'm looking at investing in Sheffield. Did you end up getting any further information? 

Cheers

Catherine