Investment?

[SPC Trees]

20k is not gonna get me a lot in the property market though lol

 

Been following this thread with interest.

 

There's always the nightmare 'mate' who has had a drug farm grown in the house or whatever other story you see in the Daily Mail. However the majority of property and BTL is one of the best investments you can get. Firstly you get monthly income to cover your rent and expenses, secondly you have an asset that is increasing in value (UK is an island, property prices will always increase in the LONG TERM) and thirdly its very tax efficient! Why do you think majority of MP's are landlords..... they know the system!

 

I've had a handful of investment property for 3 years now, I've pulled out almost everything I've put into all of them already.

 

You say 20k wont get you a property.... have a look at a small mid-terraced up north, with a 25% deposit I bet you wont be far off... I see bargains all the time up there :-)

 

If you dont know about a subject.... buy 3 books about it....

[TurtleWoods72]

I could have bought a mid terrace house in Manchester for £5000 going back twenty years.

 

The problem was, all the houses were damp, derelict slums, boarded up and full of junkies and squatters.

 

More hassle than it's worth to buy a place nobody will ever want to live in. Unless they're fans of Escape From New York and fancy a Snake Pliskin des-res.

 

Buy something nice, or spend 90% of it on chainsaws and waste the rest on property and investment.

[scraggs]

I've had a handful of investment property for 3 years now, I've pulled out almost everything I've put into all of them already.

I would love to know how you have managed that.

I can't see how 3 years rent has paid for a house, unless I am reading that wrong ?

[Logan]

True to a point but you cant teach intelligence and business acumen, its either in you or its not. Many a school dropout has done well , Branson is one. There are also plenty of egg heads with brains the size of a planet that live in filthy squats. I know some wealthy property developers that can barely read and write that could buy most of us with their small change.

 

Bob

 

Like it Bob, very very true. Having a brain the size of europe has got me...

 

Where was I?

[Billhook]

Like it Bob, very very true. Having a brain the size of europe has got me...

 

Where was I?

 

 

Having a brain the size of europe has got me... thinking that I am better off out of there!

[SPC Trees]

I would love to know how you have managed that.

I can't see how 3 years rent has paid for a house, unless I am reading that wrong ?

 

Not a problem I will explain using an example of just one property in Essex:

 

Bought in 2011 for £120,000, using a 25% deposit (Thats £30,000) since then have been taking £725 rent PCM, my expenses (including mortgage) being £500. Thats £2,700 per year for 3 years= £8,100.

 

Just remortgaged the house, its now worth £160,000.... The magic of property is that extra value on the house (£40,000 in this case) is ALL mine

 

Yes I'm not allowing for tax here but you pay Capital Gains Tax when you sell the house, even so I have got my initial money back already.

 

Hope that helps.

[sandspider]

Surely it's not that simple?

 

To quibble over details, you haven't got the money back out, it's still in the house. Assuming you can sell it again in due time, and that the bubble doesn't burst. You also haven't got back the purchase price, just (in theory) the deposit that you put down.

 

There's tax, maintenance costs, wear and tear, redecoration etc. surely too? (Even though the expenses are I believe tax deductible). What about rent arrears, times when you don't have a tenant, management company charges?

[peatff]

You say 20k wont get you a property.... have a look at a small mid-terraced up north, with a 25% deposit I bet you wont be far off... I see bargains all the time up there :-)

 

A friend of ours bought some cheap terraces in Newcastle through an agent two years ago, the local council put a compulsory purchase order on the whole street and demolished them. It doesn't always work out, there are a lot of things to look into and even then it can go belly up. If your money is spare cash go for it but if you depend on it being available in the near future study carefully.

[spudulike]

I am watching the Bank of England carefully, one increase in the interest rate and there will be a lot of people with property that will be caught out.

 

In my early years, we had a 9% interest rate - great for savers as I was in my early days. People now are living with high cost of property but a low interest rate supporting it so it sort of balances.

 

If that interest rate rises to say 5%, people will be plunged in to negative equity fuelled by the poor wages and austerity measures in this country. Property prices will either stagnate or fall as we have seen in the past.

 

I can claim 65% stock market growth over the last two years but have seen 8 years of poor performance before that so have to take that in to account.

 

In short, both types of investment can be good, both can take a severe knock, property can be time consuming and needs more input with tenants, contracts, inventory, agents, insurance etc

 

I have always thought that there are two types of investor, people who don't understand the stock market and do property because of it and then people who are happy with the stock market and don't want the hassle of property.

 

I guess if you have money and want to invest, you buy up to one or the other, whichever you are more comfortable with!

[hamdogg]

Does anybody know the best isa at the min? Can't find much over 1%