Student wants to get into BTL

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By way of introduction, my name is Max, I am a second year Economics student at the University of Kent. Currently, I have taken a year out to work at one of the Big4 accountancy firms to chase a career that I have always aspired to have.

I work within one of the Real Estate teams, and have recently sparked a personal interest in the field. Student wants to get into BTL

Upon researching the steps to building a property portfolio, I stumbled upon the article you wrote “My first buy to let property investment” and I am inspired.

Given my current position as a student (with an income this year) I was looking at the probability of actually being able to acquire and develop property and start growing a portfolio.

Reading your article, you made your first purchase in 1989, and it was 7 years later before you actually made your first intentional purchase. I understand that a large amounts of capital is required for these investments to take place, but I feel like 7 years is too long a time span to wait.

Further to your experience, looking back with the knowledge you have now, was there scope to start building your portfolio earlier than you did?

If so, what advice could you give to someone that:

a) has student debts;

b) could potentially have a stable income upon graduation; and

c) wants to get into the property market sooner rather than later as house prices are continuing to increase.

Thank you for the article, it was certainly helpful.

I look forward to hearing from you.

Kind regards,

Max

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Comments

  • Hi Max

    Thank you for your Readers Letter and Happy New Year to you.

    Things have certainly changed a lot since I left school. Buy to let mortgages didn’t exist then and only people with wealthy parents went to University as there was no Student Loan Scheme in those days.

    Student loans are a very cheap form of finance and whilst it is hard to say for certain what I would do if I had the same opportunities as you now have I think I have quite a good idea. I would go to University, take the student loan and I would also work as hard as possible. My goal would be to pay my own way through University and use the student loan money to fund one or more deposits to buy my first property. If you have already run up student debt then I think you should ask yourself some very tough questions as to why. Is it because you are not smart enough to do your coursework and also to earn a living at the same time or is it because you are not passionate enough about your goal? We all have 24 hours in each day and the ability to decide how to use that amount of time. It’s all about choices. Most students will look back on their University days with fond memories in years to come. Some will have blurred recollections of spending a lot of time in bed, at festivals, partying and of course an education whilst others will have had very different life experiences and just a few will have begun building their property portfolio as well. Having not come from a privileged background my perceptions are obviously somewhat tainted by my working class upbringing. I am not trying to judge, I have no insight whatsoever into your personal circumstances, hence I must rely on my own experiences to answer your questions. You may well get very different answers from other people who have had very different life experiences to my own.

    With the opportunities you have I am convinced I could have owned my first property in less than half the time. If I’d have had wealthy parents and if the scheme I have linked to below had been available I would certainly have talked to them about that too.

    See >>> http://www.property118.com/student-buy-to-let-mortgages/33850/
    .
    Mark Alexander recently posted…Landlords Buying Group – Insurance RenewalMy Profile


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  • Hi Max,

    It’s great to see someone of your tender years becoming interested in the benefits of property investment.

    Time is most definitely on your side!

    Most vanilla BTL mortgages need a 25% deposit and a squeaky clean credit rating.

    It may take some time for you to build up enough savings for a 25% deposit, so is there any way that you could JV with your parents on your first purchase?

    One thing you CAN do is learn as much as you can by reading forums like Property118 and Property Tribes. Start building your knowledge and relationships.

    There is the famous saying that “your income is the average of the 5 people you associate with the most”. Therefore, if you start associating with other landlords and property professionals …. :)

    I wrote a post that may be of interest to you and help you shape your approach:

    8 things to consider before getting involved in property in 2014

    http://www.propertytribes.com/questions-ask-before-starting-property-business-2014-t-9773.html

    Best of luck and remember that success comes from sustained and intelligent action!!
    Vanessa Warwick recently posted…7 reasons why January is a good month for landlords.My Profile


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  • “only people with wealthy parents went to university as there was no student loan scheme”

    Mark, where did that come from? No, we went with a grant which we did not have to pay back!


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  • Reply to the comment left by “Puzzler ” at “03/01/2014 – 17:29“:

    Maybe we are different ages? No such options were viable for me.

    For me the only choices were the school of hard knocks and the university of life.
    .
    Mark Alexander recently posted…Article 4 Planning for HMO in Brighton – help required for failed planning consentMy Profile


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  • Mark – a little late now but I suspect your school advised you badly – maintenance grants were available from about the sixties to the late nineties.

    Max – I’m not sure how soon you hope to be up and running, but in the current environment most (all?) BTL lenders expect you already to have an existing mortgage up and running before you can apply for your first BTL.


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  • More haste less speed as they say! What about ditching uni and getting a full time job as an estate agent or letting agent,spend a couple of years learning the trade from the inside and earn a wage and commision at the same time. Then when you know what your doing and you have saved some money you can dip your toe in the water with your 1st BTL. With what you would have learned working within the industry you could probably source discounted properties for yourself in your area and start your fruitfull journey as landlord. Ive never been a fan of uni personally and i left school at 16 as you can probably tell from my spelling lol. But i do know several people i went to school with who went to uni and none of them have an ambitious bone in there body and i earn more than all of them!

    Ive always thought and still do that your better off leaving school at 16 and getting a job at the bottom,spend 3 years working your way up and gaining experience and earning at the same time, i think that gives young people a better start in life than spending 3 years at uni getting drunk and in debt then when you leave yes you may have a degree but what experience do you have,None! Obviously these days certain jobs insist on a degree so i understand some people have to go to uni to get there chosen job but if you want to be a landlord and work within property then there are options that dont involve uni. Some might agree with me MOST WONT. Rant over!


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  • This has turned into an interesting discussion. :)

    Are property investors born or are they made?

    I think so much of it depends on a thirst for knowledge, commitment to personal development, and a strong desire to get out of the rat race.

    As landlords, we need to have an entrepreneurial spirit as we need to wear so many hats … business owner, marketeer, networker, communicator, problem solver, etc etc.

    The school of life/hard knocks is certainly one of the best places to learn.

    Perhaps a good combination for the original poster would be to go to University but also hook up with a mentor who can start them on their property journey?

    University sets people up for a job or career for life, but that landscape is changing so much and people are much more likely to be contract based and move around and change career direction.

    I myself have had four “lives”:

    1. Hospital technician – age 21 to 27

    2. TV Presenter – age 27 to 36

    3. TV Producer/Director – age 36 to 46

    4. Landlord/web enterpreneur – age 42 to my current age. :)

    I didn’t go to University, although I did do an HND in Medical Physics. I don’t use that learning too much these days!

    The days of “job for life and a golden watch” are LONG gone.

    Whatever any one chooses to do, they must understand that the web is the future of business and start building their google footprint and on-line profile.
    Vanessa Warwick recently posted…Top 4 social media sites that property professionals should invest time in for ROIMy Profile


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