Tag Archives: ROI

Part two of the story of my first intentional property investment Landlord News, Latest Articles, Property News

Having agreed to buy my first intentional property investment I soon realised that it’s a bit like a visit to the loo, paperwork is important!

I’d purchased my first home a few years before but to be honest I’d forgotten about all the paperwork I’d done at that time. All of a sudden it all came flooding back to me. I wonder if women go through something similar when they give birth to their second child? Never say never again!!! Continue reading Part two of the story of my first intentional property investment


My first intentional property investment – part 1 How I got started, Landlord News, Landlords Stories, Latest Articles, Property News

The story began in 1989 when I purchased a property which I soon realised I couldn’t afford to live in. I suppose that was my first property investment and many landlords get started that way. I rented that property out when interest rates shot up and property values crashed leaving me in negative equity. I muddled through and I still have that property now. With that baptism of fire into property investment I’d probably have been forgiven for never wanting to buy another one but that’s not how life worked out. Mark Alexander

If only I had waited a few years I thought, I could have purchased the same property for 40% less than I paid for it. Then it dawned on me, properties would go back up in value at some point, that was one of the reasons I didn’t want to sell. I wished I could have purchased some more property at that time but I had no money so there was only one choice.

Step one – saving up the deposit

I had to work smart and save hard so that I could buy another property before they started going up in value again. I remember watching my bank balance grow, my target was to save £10,000. It seemed like a fortune at the time, when I set the goal I could barely make ends meet, never mind save any money. Nevertheless, I took an hour out every Saturday morning to document my goals and my progress. In April 1996 I had the magic £10,000. Having saved all that money I can tell you it still took a lot of courage to take it out of the safe hands of the building society and invest it into a property, despite the fact that’s exactly what I’d been planning for several years. Remember, properties didn’t really start to recover from the late 80’s / early 90’s crash until the middle of 1996. I only had a gut feeling at the time that they would go back up in value, I just didn’t know when and to be honest I didn’t really know why either. I just thought it was likely that history would repeat itself.

Step two – overcoming my fears

My biggest worry was that, in the short term, interest rates could go back up again and property values could go down even further. There was no way that I could afford to pay two big mortgages if everything went wrong. It wasn’t just interest rates that were worrying me either, what if I couldn’t rent the property, what if my tenants didn’t pay, what if I got an unexpected maintenance bill? I realised that I just couldn’t take the risk of investing 100% of my savings, I needed to keep some money aside for the unexpected, but how much?

Step three – what to buy and how to stay safe

The cheapest properties at the time were around £15,000 in my area. They were in grotty locations though and the letting agents I spoke to said they would be hard to let and even if I did I wouldn’t be dealing with a particularly friendly demographic of people. I realised that I couldn’t really afford a house, not a modern one anyway, and not being much of a handyman the thought on ongoing maintenance of an old terraced property was very off-putting. Therefore, flat’s were my target. Would I go for an upstairs flat or a downstairs flat though? There were advantages to both. Old people would be more likely to rent a downstairs flat, so too would people with babies. Flat’s with lifts were not common place back in 1996 and any that had them were way outside my budget. However, when I started looking at ground floor flats and talking to other landlords I realised that damp was often an issue, so was security. The reason for this was that people don’t leave windows open in ground floor flats. Therefore, I decided to go for a first floor flat.

Step four – location and price

Having decided to go for a first floor flat I realised that I was probably targeting a young working couple as my tenants. I’d also worked out that my budget was around £20,000 based on the fact that I needed a 25% deposit (£5,000) and could borrow the other 75% (£15,000). That left me with £5,000 of which I budgeted £1,500 to decorate and to pay all the fees associated with buying. I knew that I needed to buy on a decent bus route into the city and the industrial estates and having visited every estate agent in town (there was no Rightmove to check in those days) I narrowed it down to three properties. All of them were above my budget but only by a few thousand. I put in an offer on all three for £19,000 and they were all refused. I was gutted and resigned myself to search again in a few months time when hopefully I’d saved a bit more. I could have gone ahead and left myself with a smaller liquidity fund but I didn’t dare. Then, after a few days one of the estate agents called me back. Their vendors had had a re-think, they would accept an offer of £19,500. I was so tempted but I stuck to my guns and I’m glad I did. I was a property investor, no chain, I could move as quickly or as slowly as they wanted. I got lucky, they accepted, I was in business! I was well on my way to owning my first intentional property investment.

Please leave me a comment below if you’ve enjoyed reading this.

OTHERS ARTICLES IN THIS SERIES

YOU ARE HERE >>> Part one – My first intentional buy to let property investment

Part two – Tips on becoming a buy to let property investor

Part three – Lessons learned whilst building my buy to let portfolio

Part four – My first property management checklist

Part five – Buy to Let Maintenance Budgets

Part six – Do landlords have to provide lawnmowers?

Part seven – Landlord, Tenants, Dogs, Pets

Part eight – Vintage 2003

BONUS ARTICLE >>> My relationship with Leathes Prior Solicitors and Property118

Part nine – Perfect tenant of 6 years turns heroin addicted prostitute – EVICTED! 

Part ten – Online Letting Agents Review


Property118.com Website Awards 2012 Worcestershire Website Awards 2012

We are delighted to announce the Property118.com website awards for Worcestershire.

Judging decisions were based on a combination of powerful analysis algorithms and human experience. Click here for further information about the awards and the judging process.

View the winners from other counties by clicking here.

So without further ado, the winners are:-

For the Accountant Category
Ballard Dale Syree Watson
Oakmoore Court, 11c Kingswood Road, Hampton Lovett, DROITWICH, WR9 0QH

For the Estate Agents Category
For the Gas and Heating Engineers Category
For the Letting Agent Category
Andrew Grant Lettings
48 Foregate Street, WORCESTER, WR1 1EE

For the Plumber Category
Vale Heating & Plumbing Ltd
Unit 5a High Street, PERSHORE, WR10 1EU

For the Solicitor Category
Atter Mackenzie
Bridge Court, 64 Bridge Street, EVESHAM, WR11 4RY


New mortgage deals for HMO and student landlords Buy to Let News, Latest Articles, Lettings & Management, Mortgage News


– News Sourced by Property118 News Team –


Kent Reliance has launched 80% loan-to-value buy to let and HMO mortgages. Rates include two and three year fixed and discounted deals.

The lender has joined the ranks of few banks and building societies inviting applications for houses in multiple occupation loans, specifically for student landlords.

HMO, student let and limited company mortgages start at 5.19%. Continue reading New mortgage deals for HMO and student landlords


Top 6 strategies for improving your cash-flow Guest Columns, Property Investment Strategies, UK Property Forum for Buy to Let Landlords

As all Landlords should appreciate, property investment is a business.

It’s not something you should ever attempt to do “as a hobby”, “reluctantly”, “on the side”, “accidentally” …. .  There’s too much at stake for that, up to and including the wellbeing of your tenants, who you are responsible for in the eyes of the law.

Like any business, cash-flow is king. Without it, you don’t have a business! Continue reading Top 6 strategies for improving your cash-flow


Avoiding being ripped off by the Olympics Guest Columns, Lettings & Management, Property Market News

Having written my article on the predicted downside of renting during the Olympics I thought I had better provide a bit of guidance for landlords on how to avoid getting ripped off.

Foreign sports tourists are also open to abuse simply because they don’t know London or the way things work in the UK. Already many scams abound, using a major online property website who I obviously won’t mention for legal reasons but I’m sure you all know who I am talking about. Continue reading Avoiding being ripped off by the Olympics


Landlords are Pawns in Battle for Control of London Buy to Let News, Latest Articles, Property Market News

Landlords have become embroiled in a bitter battle for the election of the new London Mayor as candidates have made residential letting a major campaign issue.

Tory Mayor Boris Johnson is standing for re-election and wants to introduce a citywide accreditation scheme for buy to let landlords. Continue reading Landlords are Pawns in Battle for Control of London


Property Analysis – Part 2 – How it can save you thousands! Guest Columns, Property Investment News, Property Investment Strategies

Missed Part One? Click to read Property Analysis – Part 1

Mortgage Cap Rate (Interest Only) = Net Annual Rental Income + Annual Mortgage Cost / Current Mortgage Outstanding

Expressed as a percentage this indicator will tell you the maximum interest rate you can sustain and still break even. Obviously the higher the number the greater the safety net you have against rate rises. Any property with a figure around 5% or less needs looking at to see where either cost can be cut or the rent increased. Continue reading Property Analysis – Part 2 – How it can save you thousands!


Property Analysis – Part 1 – How it can save you thousands! Guest Columns, Property Investment Strategies

Whether you own one or one hundred properties you must monitor the performance of each property on a monthly and annual basis. Before you can do this though, you need to have a goal or target in mind as to the performance you wish to achieve with each property over a specified time period, whether 1 or 10 years. Continue reading Property Analysis – Part 1 – How it can save you thousands!


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