Jill
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Registered: 8th Jun 01
Location: Aylesbury, BUCKS
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Does anyone have any information they could give me about this and especially if it's first hand experience? Want to know the general ins and outs of them. For example if my mortgage is with X company is it best to stick with them for a second morgage on a property that will be buy-to-let? Or is it best to shop around? Do you have to use your property as some sort of equity or are you able to put a deposit down and take it from there kind of thing?
Muchos gracias in advance for anyone that can help  No doubt I'll probably think of some more questions too...!
JILL 
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AndyKent
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Registered: 3rd Sep 05
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To be honest, now isn't really a very good time to get into buy-to-let. Give the market 12 months to settle down and see what prices do would be my advice.
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Cosmo
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Registered: 29th Mar 01
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You cant say that, as some places are still rising in value enough to make BTL's an attractive option.
As for mortgages on them, most lenders will look for something like a 15-20% deposit (you'll find some less, and some more) and then the rest of the value you can borrow is dependant on the amount of rent that the property can demand. It wont normally have anything to do with your personal financial situation i.e. earnings and current mortgage commitments - although it wouldnt surprise me if in this current market condition that they decide to take a look into this also.
I'd go to your current lender, as they may well offer a better rate to you for being a current customer, but I'd also go to an independant mortgage advisor and get their advice and if you want to go ahead they'll know the best deals out there at the moment.
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AndyKent
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Registered: 3rd Sep 05
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Ok, so not everywhere is slowing right down, but the areas surrounding London, have.
I live on the commuter line between Bedford and the capital and prices haven't moved in 4 months. I can't see Aylesbury being much better (might be wrong of course, but unlikely  )
[Edited on 27-03-2008 by aPk]
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Cosmo
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Registered: 29th Mar 01
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quote:
Originally posted by aPk
Ok, so not everywhere is slowing right down, but the areas surrounding London, have.
I live on the commuter line between Bedford and the capital and prices haven't moved in 4 months. I can't see Aylesbury being much better (might be wrong of course, but unlikely )
You've got to remember though that we are in a time now where people are struggling to get mortgages and house prices are high - so plenty of people will be looking to rent.
If you are in a position to afford the deposit, and can sit on the property for 5yrs+ then I see no reason why it wouldnt be a great investment - given that you select the area correctly!
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AndyKent
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Registered: 3rd Sep 05
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Personally, I'd still wait. There is a lot of talk of number of properties on agents books falling, that can only mean a stalling, or falling or prices in the short term.
I don't think it would hurt to wait 6 months at least, prices aren't going to go up much, if at all so you won't be loosing out.
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Conway563
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Registered: 7th Jun 06
Location: Yate, Bristol
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Speak to a_j_mair Jill.
He got one a cople of months ago IIRC
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Jill
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Registered: 8th Jun 01
Location: Aylesbury, BUCKS
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Cheers hun I'll drop me a PM unless he reads this thread
ApK it may not necessarily be in Aylesbury, but thanks I know what you're saying regarding prices etc
JILL
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Dan
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Registered: 22nd Apr 02
Location: Gorleston on Sea, Norfolk
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It doesnt really matter that house prices may be going down slightly. If you have enough of a deposit, so that the rent covers the mortgage, your not paying for it anyway. therefore what ever the value it 25yrs time is, all you hvae paid is your deposit
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psycho sport
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Registered: 27th Mar 03
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Now is a good time to get your self a bargain. It's a buyers market and with repossesions taking place now is a brilliant time. I work in letting and we are still busy as people want to rent rather than buy. Just make sure that you get a good return on your Investment, eg. £250,000 see's you renting it for atleast £1000 pcm. My advice would be to go for it and make lots of offers on places in order to test the water, some may be desperate to sell!
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AndyKent
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Registered: 3rd Sep 05
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Dan, I'm thinking less negative equity more of getting yourself even more of a bargain by just holding off that little bit longer.
Say you wait 6 months and £10k comes off the price, thats a load of interest and repayments you don't have to bother with
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Ecosse Sport
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Registered: 5th Jun 02
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When I bought my second property a few years ago I found it easier to get a mortgage with my existing lender. I had cash for a deposit, however if you have equity in your property you may wish to use this as security on the 2nd property.
I've now got a few other other properties, for the third mortgage I used a local independent mortgage advisor who was excellent. They helped sort out the mortgage for my house to live in with Nationwide.
Now I deal with RBS corporate banking for my buy to lets - they're a lot easier to deal with than the normal lenders for individuals.
I'd suggest having a look at Skipton as they offer good deals on buy to lets.
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Colin
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Registered: 4th Apr 02
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Im put off having a second home with capital gains tax hanging over any profit made on it. How do people get around this?
40% isnt it....on any profits 
Im not sure I have the right about all this but my understanding is:
Property 1.
Ive owned & lived in for 3yrs. 50k equity in it.
Need to move but want to keep P1 on to rent out.
BTL mortgage taken out on this property & rented out.
Profit on rent is taxed accordingly to income tax.
Property 2.
New main home.
Normal mortgage.
Then say 2yrs further down the line you want to move again, upgade. But you require to sell both properties to do so.
Am I right in thinking :
Property 2: Main residence, sell up as normal.
Property 1: Second home, sell up & any profit made (I believe from when you purchased it) is taxable as capital gains tax at 40%? So if its up say 60k by then you only see 30k?
Im not sure if thats how it works, seems so from what ive been reading though!!
[Edited on 27-03-2008 by Colin]
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myke
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Registered: 7th Feb 01
Location: High Wycombe, Buckinghamshire
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colin i think you only have to have lived in it for a couple of years to get out of the capital gains.
as you'll be renting your current home, you should be ok, presuming what i've said is correct.
can't remember the source of this, so definately get confirmation.
I'd like to do this down the line a little too. would you manage contracts and things yourself or have a lettings agency manage the whole thing and just send you cheques?
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Dan
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Registered: 22nd Apr 02
Location: Gorleston on Sea, Norfolk
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I dont know about round your way colin, but to rent anywhere out now round here, unless you have a pretty huge deposit, you dont make profit, and sometime have to add to the money to make the mortgage payment.
I see what your saying Apk, but what if it goes up 10k in two years, thats even more you have lost/more to pay when you do buy. Also in my eyes its best to get on the market with it asap. In 25years time there is no way the property is going to be worth less than it is now. Why run the risk of missing out on it not going down now. End of the day it isnt your money thats getting wasted if it does go down.
I really cannot see the price of properties dropping much if at all. Any 2 bed semi and smaller are still rapidly going up round here. 3/4 + beds are just levelling out.
May well be different in other area though
[Edited on 28-03-2008 by Dan]
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AndyKent
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Registered: 3rd Sep 05
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Put it this way, with the market in the state its in at the moment, property will not be going up (in the majority of areas) by any considerable amount in the next 12 months MINIMUM.
I'd say its easily worth the risk to hang on a short while - if you loose you loose, but the chances of getting a bargain are too great, moreso in the London commuter zones.
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Dan
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Registered: 22nd Apr 02
Location: Gorleston on Sea, Norfolk
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so in 12 months the house price goes down 10k.
Your leasing the house for 800pcm. Thats nearly the 10k paid of the mortgage already. i know its not as simple as that, but id more than be prepared to buy at any time. the sooner you do it, the sooner its paid off.
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Jill
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Registered: 8th Jun 01
Location: Aylesbury, BUCKS
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quote:
Originally posted by aPk
Put it this way, with the market in the state its in at the moment, property will not be going up (in the majority of areas) by any considerable amount in the next 12 months MINIMUM.
I'd say its easily worth the risk to hang on a short while - if you loose you loose, but the chances of getting a bargain are too great, moreso in the London commuter zones.
There's always going to be repossesions though so doesn't matter when you buy tbh. Fair few going from round Aylesbury atm and they're very much cheaper atm.
CheeRS for you help people btw
JILL
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AndyKent
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Registered: 3rd Sep 05
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quote:
Originally posted by Dan
so in 12 months the house price goes down 10k.
Your leasing the house for 800pcm. Thats nearly the 10k paid of the mortgage already. i know its not as simple as that, but id more than be prepared to buy at any time. the sooner you do it, the sooner its paid off.
Well, except you would have been putting that money away to use as a deposit, meaning you're now 20k better off
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Colin
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Registered: 4th Apr 02
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quote:
Originally posted by Dan
I dont know about round your way colin, but to rent anywhere out now round here, unless you have a pretty huge deposit, you dont make profit, and sometime have to add to the money to make the mortgage payment.
[Edited on 28-03-2008 by Dan]
I could make £150-200 a month renting, going by the one next door to me (1 bed flats) which rents out for 150 more than my mortgage payments. That could pay a fair chunk of any additional mortgage. Im more interested in the market growth being honest, following the recent 3yr trend I should make an additional 10k a yr on this flat, along with whatever a second property goes up. I wouldnt want to be a landlord as such for long, couple yrs should see enough between 2 owned properties, savings & guaranteed salary rise to sell up & buy a very nice home! Thats all im interested in tbh!
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Robbo
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Registered: 6th Aug 02
Location: London
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BTL mortgages are generally requiring 25% deposit atm, to ensure sufficient equity in the property to cover the credit crunch and fallign house prices
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Colin
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Registered: 4th Apr 02
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I thought the 25% has always been required, to ensure people are not taking on more than they can handle. i.e. renting a house for less than it costs them.
Alot of people take on a 2nd property under normal terms. Its another thing im unsure about doing. AK done it I think & its been fine. tho theirs wasnt a long term thing I dont think - same as I woudnt be looking to rent out long term, IF I done it!
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Dan
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Registered: 22nd Apr 02
Location: Gorleston on Sea, Norfolk
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My mum and step dad both bought houses on normal mortgages.
Its easy when you can then ring up and have post directed to your business address, as your office is there.
If i had the money avalible atm, i would definatley invest it in a house no. irrelevant of the current supposed "decline"
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Fee
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Registered: 16th Nov 05
Location: With AK
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Capital Gains Tax is dropping to 18% after 4th April
but there is no taper relief anymore....
so say in the past you could provide receipts of money that you have spent on the property and that would be deducted from your taxable profit.
Now it is going to be flat rate 18% on profit
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Robbo
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Registered: 6th Aug 02
Location: London
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DOnt forget the annual allowance fo around £10k
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