advice on buying a house to rent out required?

[Ja Salford Blue]

Can anyone offer any advise as per the thread title?

I want to invest some money in a small propery (proberbly a 2 bed terrace in the Salford area) to rent out.

I have seen a few on Rightmove between £55-70k. I would be looking to put down a 10% deposit and then spend no more than £1.5k on renovations (mainly decoration, carpets and bathroom sweet, all of which i will install myself).

I am already a home owner myself.

does anyone on here rent out properties? If so is there anything i should look out for or avoid?

Also do local councils still rent properties from private tennants?

cheers

 

[Blue Mist]

Sorry to disappoint you but you will need to put a 25% deposit down with any mortgage provider.

They use to do lower amounts, i.e. 10% but since the crash they insist on 25% that way if you cannot pay they can sell the house without fear of losing money.

1.5k is more than enough for decorating, carpets etc but if you start talking about bathroom suites it could go higher. (Can you do the plumbing etc ? not that easy). It is easier to rent out an unfurnished property.
Mortgage lenders do not like you taking on 'Social'- unemployed tenants therefore you are unlikely to get a mortgage if you go through the council route.

Also the main profit is made in the difference between the purchase price and the sale price so you need to think about an area that will increase in value.

Don't forget to include solicitors fees.

 

[DavidChubs]

We bought a flat last year to rent out.

A couple of things we noticed.

1) Our bank, Barclays, wouldn't lend less then 65k for a buy to let, so we had to go elsewhere. I assume that most main banks will be similar. We got an independent mortgage advisor round. She came up with all sorts of deals.
2) We were told that for a buy to let it had to be a minimum 20% deposit.
3) As a landlord you will need annual gas safety checks carrying out.

If I think of anything else I will post again.

 

[Ja Salford Blue]

thanks for the info lads, how stringent are they on buy to let mortgages?

For instance could i buy with a standard mortgage and then rent out within a few months?

If not i think i may have to look at buying with a view to selling for a profit following a few cosmetics to the property, i can not afford a 20-25% deposit.

cheers

 

[johnmc]

Id say there is a high percentage of landlords who do not let their mortgage company know they are letting the property out

 

[Bill]

We bought a flat last year to rent out.

A couple of things we noticed.

1) Our bank, Barclays, wouldn't lend less then 65k for a buy to let, so we had to go elsewhere. I assume that most main banks will be similar. We got an independent mortgage advisor round. She came up with all sorts of deals.
2) We were told that for a buy to let it had to be a minimum 20% deposit.
3) As a landlord you will need annual gas safety checks carrying out.

If I think of anything else I will post again.

I would avoid buying a flat, I bought a buy to let and since then the management of it has changed hands 3 times, each one putting the price up, right now we are trying to buy the management ourselves, 80% of the owners need to vote to hoof the present lot of thieves.

op.
know your area and your market. in some areas you will only draw 400 quid a month if you buy a house at 60k or a 100k. no good having 40 k tied up or on mortgage for no reason, may as well get another and draw 800 a month.

 

[metalblue]

thanks for the info lads, how stringent are they on buy to let mortgages?

For instance could i buy with a standard mortgage and then rent out within a few months?

If not i think i may have to look at buying with a view to selling for a profit following a few cosmetics to the property, i can not afford a 20-25% deposit.

cheers

AFAIK one typical condition for a standard mortgage is it is the only mortgage you are running. They ain't daft mate.

 

[mancitymick]

Currently let mine out. The letting agency charge me 8% for a fully managed service

 

[kinkysleftfoot]

Id say there is a high percentage of landlords who do not let their mortgage company know they are letting the property out

Not really as you can get repossessed for that and I have known it happen.

Very silly to do it as it voids all your tenancy agreements etc so you will never be able to evict a bad tenant through the courts

 

[bgblue]

Id say there is a high percentage of landlords who do not let their mortgage company know they are letting the property out

Not really as you can get repossessed for that and I have known it happen.

Very silly to do it as it voids all your tenancy agreements etc so you will never be able to evict a bad tenant through the courts

Agreed, be legit from the beginning, and good luck