First time buying a property for rental

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  • First time buying a property for rental

    Hello.

    I have been to view a house it needs a bit of work (around £5000 of work), however, the house is priced at £41,000. Looking at properties nearby they seem to go for around mid £70k. Rental income would fetch about £400 a calender month.

    Do you think this would be a good investment for a first time property buyer?

    Thanks

  • #2
    The first thing I would want to know is why is it being sold so cheaply.

    Is this an auction estimate? Are there sitting tenants?

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    • #3
      No tenants and its not an auction. The property itself is in decent shape, didn't find any serve underlying problems, but does need central heating. The owner wants a really quick sale.

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      • #4
        Get a GOOD solicitor to check out the paperwork (deeds etc..) sounds fishy... as daveg says, why cheap??

        My rule of thumb: Double the time you thought of for how long work will take, triple your 1st estimate for ££££

        It's not being flogged by one of those "BMV" cowboys is it??

        Cheers!!!
        I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

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        • #5
          Its not as mad as it sounds. I bought a 2 bed end terrace for 38k January this year and its currently let for 500 a month (LHA tenant). It was ripped to bits by vandals but i had it all spruced up on 7k. Its not in the nicest part of town but its not twinned with the Gaza strip either. It would sell for 55 easily.

          Having said that, the "quick sale" would raise a few alarm bells. It wouldn't have to sell it for 40k for a quick sale if the surrounding houses are going for 70k, thats madness.

          Is this going through an estate agent?

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          • #6
            Selling a trashed house worth £55k for £38k is not crazy but selling a "mid-£70k" property for £41k which requires £5k is pretty dodgy.

            Ask yourself; if it'll only cost £5k for add £30k to the property value why hasn't it already been done?

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            • #7
              There are also agents who put properties on for very low prices to attract attention, but they don't ever sell at that low price. Waste-of-time merchants.
              All posts in good faith, but do not rely on them

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              • #8
                Pay a surveyor for time only and to give you a verbal on the spot report only.

                That way you don't pay for half a day typing and your surveyor has no liability.

                And it is cheap indicator for you.

                ML
                Refer Mad Regulators to Arkell vs Pressdram.

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