Moving away from London ...

[sasguru]

Looking into this - the idea being to buy a similar sized property in the home counties, and taking into account the difference between premium London and other properties, this should free up a few hundred K in cash for BTL(s) to generate a regular income.
What sort of rental income could you generate nowadays for BTL(s) worth £400K? Anyone doing this?

[doodab]

Looking into this - the idea being to buy a similar sized property in the home counties, and taking into account the difference between premium London and other properties, this should free up a few hundred K in cash for BTL(s) to generate a regular income.
What sort of rental income could you generate nowadays for BTL(s) worth £400K? Anyone doing this?

A good rule of thumb is value / 1000 ~ weekly rent.

[EternalOptimist]

woof

[sasguru]

A good rule of thumb is value / 1000 ~ weekly rent.

Hmmm - I think it could vary widely if I bought say 2 not so nice flats at £200K each or one much better property for the whole £400k

[DimPrawn]

Leaving your successful permie management job?



More like it's the looming benefits cuts means the DSS won't pay your rent anymore.

[ChimpMaster]

Looking into this - the idea being to buy a similar sized property in the home counties, and taking into account the difference between premium London and other properties, this should free up a few hundred K in cash for BTL(s) to generate a regular income.
What sort of rental income could you generate nowadays for BTL(s) worth £400K? Anyone doing this?

OK I'll bite, just for fun though right.

It depends how you want to leverage, if at all.

For cash:
You could buy 2 houses for £200k each around the home counties or to the west of the M25, bringing in rental of ~£900/month each.

Or you could buy 6 houses in Bradford, bringing in £450/month each.

Leveraged:-
Around home counties I would guess at buying 8 houses with a 75% LTV BTL mortgage. Interest payments of ~£550 on rental income of £900 a month meaning £2800 profit per month before tax and other costs.

You could leverage up and buy 20 houses in Bradford, with an interest payment of around £170/month. So rental=£450, i.e. profit = £5600/month before tax & other costs.

But you're gonna have to love Bradford a heck of a lot to want this

Still, we all know you don't have £40 let alone £400k to invest, so this is all just a cow's opinion.

[sasguru]

Leaving your successful permie management job?



More like it's the looming benefits cuts means the DSS won't pay your rent anymore.

I'm preparing for retirement in 5 years, you wage slave loser.
While you're working in your poorly paid public sector contract, I'll be taking up a new hobby like flying or sailing.

[Sysman]

Hmmm - I think it could vary widely if I bought say 2 not so nice flats at £200K each or one much better property for the whole £400k

Does "better property" necessarily equate to ROI?

Think about that one carefully. I'd far rather have a row of 2 up 2 down cottages that I can rent out to couples that want to set up home than a single des res rented to one family who might want to move out because they don't like the view.

[sasguru]

OK I'll bite, just for fun though right.

It depends how you want to leverage, if at all.

For cash:
You could buy 2 houses for £200k each around the home counties or to the west of the M25, bringing in rental of ~£900/month each.

Or you could buy 6 houses in Bradford, bringing in £450/month each.

Leveraged:-
Around home counties I would guess at buying 8 houses with a 75% LTV BTL mortgage. Interest payments of ~£550 on rental income of £900 a month meaning £2800 profit per month before tax and other costs.

You could leverage up and buy 20 houses in Bradford, with an interest payment of around £170/month. So rental=£450, i.e. profit = £5600/month before tax & other costs.

But you're gonna have to love Bradford a heck of a lot to want this

Still, we all know you don't have £40 let alone £400k to invest, so this is all just a cow's opinion.

Well believe what you want.
It would be cash.
And I'm inclining towards the fewer or even one property option simply because its easy to manage and I've done this before with professional tenants rather than DHS types.

[d000hg]

A good rule of thumb is value / 1000 ~ weekly rent.

In my town that's probably a bit high, I would have estimated £1000pcm on a £400k house but maybe £1500 as the ceiling.