your views please.

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    your views please.

    Hello

    I'd be keen to hear what others on this forum would do in my situation.

    I have a house which I own outright and have been letting it to a friend for the past 2 years (2 bed terrace worth 85 - 90k) House is currently empty.

    I have our family home with an outstanding mortgage of 100k.

    It'd be great to be mortgage free but I'd imagine the house would take a while to sell in the current climate. Renting it out to a friend was no trouble but I'm not sure about the potential hassle of renting to other tenants even though it'd probably rent fairly quickly.

    Although it's up to me to decide I'd be keen to hear what you would do.

    Many thanks in advance.

    #2
    Remortgage the rental property- withdraw some money from this and pay off your mortgage?

    plan b) remortgage rental property, buy another rental property and pay off some of your own mortgage?

    depends whether you intend on getting into the property game or not….?
    Daddy Landlord

    Comment


      #3
      if you decide in getting into the property game, you may decide to use a letting agent that can source tenants and manage the tenancy on your behalf…this CAN be hassle free depending on how good the agents are...
      Daddy Landlord

      Comment


        #4
        Further to the above there is a wealth of books on Amazon that are worth a read regarding being a landlord. It's not generally for the faint hearted.

        It is also important to understand your personal risk profile and how you feel comfortable investing your money.

        Comment


          #5
          Thanks for that, some useful info there.

          I'm probably going to look at re-letting the house via an agent. If all goes well then I might consider re-mortgaging and doing something with the money. I'll have a chat with the local letting agents, see what the costs & demand for rental properties are likely to be and take it from there. There seems to be a lot of houses around there which have been for sale for a long time although the houses either side have both been rented out several times since I left.

          Cheers

          Comment


            #6
            Just thought I'd update on this thread.
            I contacted a few letting agents and they suggested that the house would rent for £440 - £500 pm.
            The letting agent I chose found tenants within 2 weeks and it's renting for £495 pm. So far so good.
            There have been a few teething problems / communication failures between tenants and letting agents (now sorted). I have met the tenants myself and they seem fine.

            I'm still toying with the idea of re-mortgaging the rented house now and going for another similar property (£80-90k). I have £20k sitting in savings doing not much at all.
            If you were in my position what I'd be keen to know what you would do next.

            Many thanks.

            Comment


              #7
              Evening,

              Do you still own the rental property outright? Are you a UK taxpayer? If so you will be liable for income tax on all profit.

              If you remortgage the rental house even to pay off your own mortgage then it'll reduce your income tax bill.

              If it were me I'd remortgage rental house, buy an 'unmortgagable' house for cash, fix it up, rent it out and 6 months later remortgage, pull out most of the equity and buy another.

              Hope this helps

              Comment


                #8
                Yes I still own the rental property outright.
                I've been filling in tax returns and paying tax on the income generated.
                Thanks for your opinions. I was thinking along the lines of getting something to fix up, not seen many places around here though. Have seen a few places which need updating but they don't seem a great deal cheaper than those which are already ok.
                Thanks for the suggestion about the books by the way, I'll probably look into getting some of those.

                Cheers

                Comment


                  #9
                  Originally posted by Dan_Manchester View Post
                  If it were me I'd remortgage rental house, buy an 'unmortgagable' house for cash, fix it up, rent it out and 6 months later remortgage, pull out most of the equity and buy another.

                  Hope this helps
                  doing something similar myself, is it an unwritten (or even written LOL) rule re the 6 months ownership, or will some lenders allow mortgage to be taken out earlier than 6 months?

                  I now own two properties for letting, one took much longer then 6 months to totally refurb, its now let and mortgage taken out on it, immediately bought a very good priced property for cash, it will take around 3/4 months to do what I want, less if I just do the basics (but then I would attract a lower mortgage offer - so I think best if I do to a higher standard - within reason of course) - would I be able to obtain a mortgage after 4 months as opposed to 6?

                  Comment


                    #10
                    The rule is written and it's six months. You can re-mortgage it prior to six months, but not at the enhanced value - just the purchase price. I believe Virgin do the purchase price, plus invoices for large purchases. For e.g. say you purchased at 100K and then had windows fitted for 5K, they would lend to you on a valuation of say, upto 75% of 105k. Realistically, you would probably be best to wait the six months and re-mortgage against the enhanced value.

                    Comment


                      #11
                      I agree with Dan_Manchester. Which ever way you look at it you are in a good position and have lot's of options! I guess a lot of it depends on what you feel like doing!

                      If you want to get serious: Remortgage, buy at auction, renovate, rent, remortgage and do it all again.

                      Comment


                        #12
                        Sounds like a plan.
                        I'll have a look into the local house auction situation.

                        Thanks for all the helpful replies.

                        Comment


                          #13
                          Theirs a few things to bare in mind, such as if you buy a house then do it up, then try to remortgage it a lot of banks won't remortgage a property without you owning it for at least 6 months. But if you are doing things slow time it's not a big deal. You wouldn't have a mortgage on a house you buy out right at an auction. You can get a lot of things like council tax and water rates waved as the house can be deemed 'uninhabitable', which simply means it's unfurnished with no fixtures or fittings. So the house shouldn't cost you anything whilst you are renovating.

                          I apply for council tax to be waved a lot when I'm doing a renovation. I've only had a council tax officer come over once to have a look, I was given warning that they were coming, they wouldn't even come in the front door because the house looked like a building site, so they were satisfied.

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