Lloyd90 Posted November 5, 2015 Report Share Posted November 5, 2015 Does anyone have one ? Might be coming into a bit of money, enough to possibly put down a large whack on a deposit. I am in no rush or hurry at all. Just asking about. I currently don't own my own property, and am half way through second year of university. More than likely will be something for when I have graduated in 2017. Just a few questions, 1) Is it worth putting down a very big deposit on one property, or splitting cash to meet the minimum buy to let amount, and trying to get more than one ? 2) Obviously the above would be interest only, as opposed to repayments to maximise cash flow ? Is this really a good idea ? 3) I have close family friends who have and rent a few student houses I am aware you need special fire alarms etc, what kind of things do you need to have upto scratch ? Thanks for anyone who can offer any insight and help Quote Link to comment Share on other sites More sharing options...
Vince Green Posted November 5, 2015 Report Share Posted November 5, 2015 You need to have cash reserves to cover the possibility (inevetability?) that you might not get a tenant or one who doesn't pay. People go into these things with rose tinted glasses Quote Link to comment Share on other sites More sharing options...
rjimmer Posted November 5, 2015 Report Share Posted November 5, 2015 (edited) Be prepared for higher interest rates. A lot of we old codgers were once crippled by 15% base rates. The Irish have a saying: 'If you're in debt, you're in danger'........ Take on something you can see yourself paying off. 50% loan-to-value should be a maximum in case interest rates rise. Have minimum of appliances, just a gas boiler, preferably. Location is important, rely on rental income in certain areas and not on value increases. Edited November 5, 2015 by rjimmer Quote Link to comment Share on other sites More sharing options...
Lloyd90 Posted November 5, 2015 Author Report Share Posted November 5, 2015 Thank you so far gents, things I was definitely considering, I have no rose tinted glasses on believe me. A possible options for me would be to buy a place with several rooms and rent the other rooms, whilst living in the house myself. Something I may consider in the future. Quote Link to comment Share on other sites More sharing options...
Vince Green Posted November 5, 2015 Report Share Posted November 5, 2015 As long as you are living there the rules change for the better. They become lodgers not tenants, BIG difference. Quote Link to comment Share on other sites More sharing options...
Lloyd90 Posted November 5, 2015 Author Report Share Posted November 5, 2015 As long as you are living there the rules change for the better. They become lodgers not tenants, BIG difference. Do you know what kind of changes Vince ? Sorry for my ignorance and thanks for your help. Lloyd Quote Link to comment Share on other sites More sharing options...
Teal Posted November 5, 2015 Report Share Posted November 5, 2015 If you don't yet own a property - would you not be more interested in owning your own place to live in, or at least potentially live in, rather than buying somewhere to rent out to others? Yes you may not see the rental money coming in, but your own rental money won't be going out by the same token, and an opportunity like this to have your own place would excite me more. If you find the right place I would imagine that you could get a lot more enjoyment out of it. That said if you are not sure what direction or where you life might take you, I can see why you may not want to stick down roots too early. Quote Link to comment Share on other sites More sharing options...
BigEd85 Posted November 5, 2015 Report Share Posted November 5, 2015 Basically it is significantly easier to get rid of non paying/troublemaking lodgers than it is tenants. You have all the power, one of my friends purchased his own house with a large deposit while at university and the lodgers essentailly paid the mortgage and covererd his cost of living. He had one trouble maker and he got rid of them with no problems. Quote Link to comment Share on other sites More sharing options...
Lloyd90 Posted November 5, 2015 Author Report Share Posted November 5, 2015 If you don't yet own a property - would you not be more interested in owning your own place to live in, or at least potentially live in, rather than buying somewhere to rent out to others? Yes you may not see the rental money coming in, but your own rental money won't be going out by the same token, and an opportunity like this to have your own place would excite me more. If you find the right place I would imagine that you could get a lot more enjoyment out of it. That said if you are not sure what direction or where you life might take you, I can see why you may not want to stick down roots too early. It's a possibility, although even as a mature student at 25 when I finish education (hopefully) at age 27 I planned to have a working holiday year in NZ or OZ as you can do a years visa before your 30. Quote Link to comment Share on other sites More sharing options...
MartynGT4 Posted November 5, 2015 Report Share Posted November 5, 2015 You might want to take a close look at the tax changes coming in for BTL because from next year you'll no longer be able to claim tax relief against mortgage interest payments. For many in the BTL market, especially those with interest only or large mortgages it's going to be a real game changer! Quote Link to comment Share on other sites More sharing options...
dougall Posted November 5, 2015 Report Share Posted November 5, 2015 You might want to take a close look at the tax changes coming in for BTL because from next year you'll no longer be able to claim tax relief against mortgage interest payments. For many in the BTL market, especially those with interest only or large mortgages it's going to be a real game changer! although one would suspect a student is not utilising their personal allowances so IT not an issue..... Quote Link to comment Share on other sites More sharing options...
MartynGT4 Posted November 5, 2015 Report Share Posted November 5, 2015 although one would suspect a student is not utilising their personal allowances so IT not an issue.... good point.. here's some info anyway - http://www.theguardian.com/uk-news/2015/jul/08/osborne-buy-to-let-tax-relief-limit-budget Quote Link to comment Share on other sites More sharing options...
amateur Posted November 5, 2015 Report Share Posted November 5, 2015 (edited) If you have gas appliances (boiler, fire, cooker etc), you will have to pay for an annual "Gas Safe" certificate. You need to also provide a risk awareness assessment certificate against Legionella and 10 year life smoke alarms. Oh! and carbon monoxide alarm if you have gas appliances Edited November 5, 2015 by amateur Quote Link to comment Share on other sites More sharing options...
rjimmer Posted November 5, 2015 Report Share Posted November 5, 2015 If you take in lodgers, the first £4250(might be more) is tax-free. Open fires need carbon monoxide alarms. You might only be able to claim for part of the repairs against tax. If you do claim, you might lose part of the Capital Gains Tax allowance on 'your personal home'. Mortgage interest on a rental property is only deductable at the standard Income Tax rate. If you live in a house supplied as part of your job, because you have to live close by, you can have a rental property and not be charged Capital Gains Tax on any increase in its value, so basically the tenant can pay for your retirement home while you are chained to your job. Quote Link to comment Share on other sites More sharing options...
LondonLuke Posted November 5, 2015 Report Share Posted November 5, 2015 As a student I would bear in mind that even on buy to let mortgages they will expect you to have a £25,000 provable income in case of void periods etc Quote Link to comment Share on other sites More sharing options...
MartynGT4 Posted November 5, 2015 Report Share Posted November 5, 2015 If you take in lodgers, the first £4250(might be more) is tax-free. Open fires need carbon monoxide alarms. You might only be able to claim for part of the repairs against tax. If you do claim, you might lose part of the Capital Gains Tax allowance on 'your personal home'. Mortgage interest on a rental property is only deductable at the standard Income Tax rate. If you live in a house supplied as part of your job, because you have to live close by, you can have a rental property and not be charged Capital Gains Tax on any increase in its value, so basically the tenant can pay for your retirement home while you are chained to your job. That's going up to £7500 next year and about time too Quote Link to comment Share on other sites More sharing options...
oowee Posted November 5, 2015 Report Share Posted November 5, 2015 Take a look at Empiric shelter the investment in Sipp and ISA avoid capital gains tax and the inevitable dodgy let and enjoy capital growth and revenues. Quote Link to comment Share on other sites More sharing options...
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