borich

Thinking of buying a house with the intent of renting it out and make some money after the mortage is covered, I am still at the stage of doing research etc, if anyone here has any comments on renting out, regarding pro;s con's, letting to students or proffeisionals etc would be greaful to here your comments

Borich

imlach

1) Be careful, we may be at the top of the market.

2) In the area you want to purchase, check out what sort of rents places are going for. Is there are lot of "for rent" signs - check how often or quickly places seem to go - talk to local rental agencies - beware, may be a saturated rental market....

3) Defintely budget for voids (times where you don't have a tenant). You should budget for at least 1 month out of 12 that the flat may be empty.

4) Rental income is taxable at your highest tax rate - you do get relief on the INTEREST on the mortgage (not the repayment part), and you can also wangle other things such as maintenance, etc (but not improvements).

5) Decide whether to rent unfurnished/furnished - both attract different types of people.

6) Be prepared for the worst. Tenants can appear as nice as pie when they agree to take the lease, and soon as things start going wrong, or they don't pay rent, the law more often falls on the side of the tenant.....

7) Manage it yourself or use a letting agent to manage it? Their charges range from 10% to17.5% of the rental per month....

Loads more!

ProperCharlie

<boat disappearing over the horizon>

Daz34

I got into this a whilst back & while I have made a decent amount of equity which I won't see till I sell them, you don't make much from month to month. Mortgage payments have gone up but rental values haven't. Also because alot of people got into this market there is a lot of competition so if a tenant moves on you have to be prepared to pay the mortgage till you get a new one.
As has been said, if you are gonna go ahead with it then research thoroughly which property to get & your target market, location etc. Young professionals relocating are generally good tenants but like a decent area, a garage for their Audi TT, modern decor & may move on every 6-12 months.

Darren

Tiggs

last weeks lotto was a roll over...anyone know where i can get a ticket for it from?

P1Fanatic

Lol good analogy!

Simon.

scoobynutta555

IMHO for small time renting empire, think you have missed the boat by 5 years on this. I started buying property 10 years ago and they have literally trebled in value since then. However, the rental income has certainly nowhere near trebled, its been relatively flat in comparison.

House prices are close to their peak if not at their peak, interest rates on the way up also, unless you have a lowish gearing, ie you are not maxing up your mortgage to cover the costs, you could have trouble in the future with negative equity if you need to sell and the market is flat.

A lot of people think that managing properties is relatively easy, its certainly not. i like to think i have seen most things that have gone wrong in the 10 years, but theres always a new unique situation around the corner

The worst one i had was a woman who swallows bleach and ice cream and tried to throw herself out of a closed window 2 floors up. Needless to say she was carted off to the loony bin And she looked plausible enough when first interviewed and referenced.

Long term, property is 99% of the time a good investment, LONG TERM.

milo

urgh.. thats gross... i hate ice cream!

scoobynutta555

Thought I'd made out of her as i kept her deposit and the rest of the months rent til I moved her bed. I found an iron burn through to the floorboards where she had attempted to iron her clothes on the carpet.

NotoriousREV

echoing Scoobynuttas post, think long term, the rent won't make you any real income, it will in all liklihood just cover the mortgage.

Having said that, my mate has just had one of his rental properties become available and was planning to redecorate before the new let but the competition amongst the prospective renters means that not only has he been able to agree a higher rent but the new tenants are doing all the decorating themselves.