Mortgaging a flat to rent out.

Former Member

I know someone considering doing this. The flat's only about £30k, he reckons a few years paying off the loan will then see him earning good money off the flat on top of ordinary employment.

Sounds good in theory, but does anyone have any experience of this in practice? I've heard elsewhere becoming a landlord is not as easy as it may seem - there are various complications and burdens apparently.

I'm considering doing likewise after Uni. I reckon it's quite possible to spend a number of years working in order to pay off mortgages while living off a minimum then just sitting back and watching the profits roll in?

Former Member

Obviously it's not quite as simple as that or everyone would do it, but it is possible. You can get special buy-to-let mortgages.

Former Member

Spliffie wrote:

The flat's only about £30k

:eek2:

Former Member

Schnap me Baby wrote:

:eek2:

It's in Cumbernauld - a boring as fuck 'new town' North of Glasgow where everyone is either a junkie or a commuter. Even the 'middle class' areas are the epitome of the suburban nightmare. Horrible place.

Former Member

Spliffie wrote:

It's in Cumbernauld - a boring as fuck 'new town' North of Glasgow where everyone is either a junkie or a commuter. Even the 'middle class' areas are the epitome of the suburban nightmare. Horrible place.

Sounds great, can I rent off you

Former Member

You are right in assuming it is not as simple as it sounds.

First of all unless you have other security buy-to-let mortages are more expensive than usual ones (because they are more risky). Therefore it will cost you more and you'll make less money than you might think.

Secondly if you get your tenant through an agency that will cost you, and if you want the agency to garentee the person that costs even more. So most small buy-to-let people just risk it that the person doesnt trash the place.

Plus of course you will have to do things like tax returns, building insurance...etc. So there's quite a lot of paper work to be done.

Dont expect good returns on your investment monthly, most buy-to-let people dont make much (if any) money on the rent, they make money on the flat itself.

If you are wanting to do this your best option is to go to a developer and promise to buy one early on in the build, they'll give it to you 10 maybe 20% off retail price to make sure they have a buyer. That way you get a new flat cheaper.

Former Member

There are so many rules and regulations govering rental properties as well, which ultimately cost money such as gas safety checks, and additional money to fork out when say the boiler breaks, cos unless the tenant is at fault, it is the landlords responsibility to fix. Just one flat is never going to make you a fortune as the monthy rental payemnts normally just about cover the mortgage, and it is not as straight forward as it would appear, so mch red tape1 But if your friend has got the time and cash, rental properties seem to be a worthwhile investment for the future :yes:

Former Member

Most money on rental properties is made on the value of the property going up over time rather than on the actual rental income. Most people will only just about cover thier mortgage and overheads (if at all) - but as a long term investment they should stand to gain money as the property increases over time.

I would take a long term view of this though unless your investing in a very up and coming area....