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Good Morning All Property Investors,

 

Up until now my strategy has been to buy properties to let, growing my portfolio organically by reinvesting any capital growth and excess rent.

I started in property in 2015 and I now have 3 properties in Buckinghamshire, not an aggressive strategy but one that at this time works for me.

 

With low interest, this going well and I would hope to add to my portfolio again this year.

This is where my dilemma comes in – I am asking myself whether I should diversify my portfolio with a new strategy.

 

I see the following strategies as options (in their basic form) -

 

1.       Continue with BTL and grow the number of properties I hold in my portfolio - the benefit being long term capital growth

 

2.       Keep my existing BTL portfolio, purchase new properties to flip and add cash.

          a.       I can then use this money to add to my BTL portfolio

          b.      Or I can continue to flip properties and increase cash (which can be used to decrease leverage in BTL portfolio)

 

3.       Sell my BTL portfolio and invest all money into flipping properties, I could then look at larger properties which could see a higher profit margin.

 

Has anyone got any experience on any of the above strategies? If you have and would like to share your thoughts I would greatly appreciate it.

 

Thanks,
Alex

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I am just going through this sort of strategy change i.e moving from a handful of btl's to more renovate/flip projects. First thing i observed is that i have to go upscale to make the numbers add up versus btl's. My main approach is to add value by refurbs and also adding non-planning upgrades such as kitchen extensions and/or loft conversions. I'm in the process of my first purchase so will have to see how it plays out and what sort of margin i can make given considerations for buy/selling costs as well as the refurb.

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Hello haf1963, thank you for your comments.

 

When you say upscale to make the numbers add up, do you mean in terms of the value of the property you will need to purchase?

If you don't mind me asking what is the typical value of a property in your BTL portfolio, in comparison to the potential property you are going to flip?

Is your portfolio in the north or south of the UK?

 

I am thinking exactly the same as you are in regards to the work I would do on a property to flip.

It would be great to stay in touch and see how things go for you with your new venture.

Do you think this will still stack up with the new stamp duty values and capital gains tax?

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Alex,

My current portfolio is btl houses in the midlands valued between 120-170k and from the flip side i think i need to look at properties around 150-200+with 50k of refurb/extension and hope to clear 40k profit. Its difficult to add enough value to a low end property to offset all the costs involved. I am also looking at better areas as the cost of refurb is the same but added value is worth more in better areas..

Ideally I need to be at 250-300k with resale of 400+ to make this work but will see how it goes

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