What would you do? Newbie landlord looking for advice!

What would you do? Newbie landlord looking for advice!

0:01 AM, 30th January 2025, About A week ago 37

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Dear landlords, first off, please excuse any initial ignorance on my behalf as this is fairly new territory. I have been reading articles and have a book to hand called “How to Be a Landlord” by Rob Dix to read. However, I would dearly like to tap into your experience and gather your opinions of the following scenario.

I’ll try keep this simple and to the point. I’m looking to retire/semi-retire very soon and will be in the very fortunate position where I will be able to purchase 3 possibly 4 properties outright, should that be the direction I go. I’ll also have my own property with no mortgage so bills should be minimised.

I’ll need an income and property has mostly always been a known dependable investment, hence why I want to purchase and rent out. Ultimately, I will want the properties to go to my 3 children at some point with a view to avoiding inheritance tax (another subject).

Finally, I’m aware, but not fully au-fait, with the government’s proposed changes, the additional SDLT that’s paid on 2 or more properties and the legal fees it will entail. Also I’ve read about the nightmare tenants you can get and need to consider how that would impact me if 1 or 2 ended up being in this category and rental income wasn’t coming in.

So my question to you all is this. Given my situation as described, would you take the property rental route or would you look at a completely different revenue stream to provide an income?

Thanks,

Steven


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Ashley

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11:26 AM, 1st February 2025, About A week ago

Am I the only landlord who wants to STAY A LANDLORD
30 years ago my wife and I were living in Wimbledon London. We had purchased a 2 bedroom flat for 25K we then bought 2 adjoining flats for 80K and 125K 15 years ago we decided to retire to the countryside (Malvern) where we rented a property to live in for £700 pm and let out each London flat for £1800. We let out the flats through an agent but manage them ourselves with 2 or 3 visits a year. Perhaps we have been lucky with tenants but overall it's been a great investment and we do understand that there would be a great CGT should we ever decide to sell (but that's not likely til we die)
A HAPPY LANDLORD

robert fisher

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11:37 AM, 1st February 2025, About A week ago

Reply to the comment left by Ashley at 01/02/2025 - 11:26Absolutely not, this is exactly what i am saying about the constant negativity on this forum. There is a place for buy to let but the days of being mortgaged to 75% to 90% LTV are too risky. If you are mortgage free it can be a great investment provided you manage the compliance , tax and tenant issues. whilst still leveraged at 50% LTV i am looking to reduce the portfolio over the next few years to a mortgage free one. The banks make it difficult and expensive to remortgage. Not like it used to be in the early 2000's.

Lordship

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11:39 AM, 1st February 2025, About A week ago

Reply to the comment left by robert fisher at 01/02/2025 - 11:18
Yes, I agree.

Think carefully if you do want to exit your BTL. What is the reason?

With the discount you would need to take from the likes of David Coughlin and such like operators, you could be better off to stick with BTL. Depending on your reasons to exit.

Think about it. You would need to accept 75-80% discount from such company for a QUICK sale.

If you want out because of a bad tenant, it could take a year, you would likely have to spend money getting the property back up to a good standard, however would that cost you 20/25% of the property value? Add in CGT, solicitors costs etc.

Re-letting to a good tenant for likely more money and BTL could earn you a better return over time.

Or, why not put it on the market for 10-15% below market value through an agent?

Dog Walker

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11:41 AM, 1st February 2025, About A week ago

I have property bought with no mortgage. All on the market now as we speak.
I will not become a slave to the new RRB and resulting Act.
Honestly, I would look elsewhere to invest your money.
Research the RRB and take time to understand how it will affect you in both the near and long-term future, ESPECIALLY if you should ever want to recover the property to pass onto your loved ones.
Make sure you are fully compliant with regulations as they currently stand and be aware of those that are incoming.
Make sure you are paying for a good, if not great level of insurance.l with legal cover and rent guard along with full referencing of prospective tenants.
Make sure you are willing to practice patience and deal with varying amounts of stress.
I wish you the best of luck!

robert fisher

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11:52 AM, 1st February 2025, About A week ago

Reply to the comment left by Dog Walker at 01/02/2025 - 11:41
thing is , if you have just one or two and they go south with arrears , damage or anti social tenants it causes huge trauma, if you are a portfolio landlord of a business built up over a couple of decades you are better equipped to ride out the issues even though they leave a bad taste. Despite 20+ years of experience i have had to encourage a tenant to find other accommodation as they were damaging the structure of the building not maliciously but by continual failure to vent properly causing mould. They would not accept the advice on the causes of mould from the agent or the council enforcement team who inspected after they complained. After a 5 year tenancy it has cost me £20K to refurbish the house, other houses have had the same tenant for 20 years and have been made into a home . It happens to all landlords .

Dog Walker

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14:35 PM, 1st February 2025, About A week ago

Reply to the comment left by robert fisher at 01/02/2025 - 11:52
Very valid points, absolutely.
I thought it only fair to make the OP aware of both sides of the coin.
There are many things that are set to kick in that could completely change the game.
These include; EPC rating of C or above by 2030, restriction of guarantor requirement, abolishing S21 eviction notices, extension of rental arrears period before court action can be taken against the tenant, protection of tenant's UC funds against rental arrears. The list goes on. While they do not burden us today, they are just around the corner.
Another concern is the removal of the Assured Shorthold Tenancy and how that may affect landlords, alongside the proposed measures/rights that courts might receive to rule that a tenant in arrears will be worse off if evicted (who wouldn't be?!) and therefore award the tenant a right to stay in that property for given time, presumably at the cost of the LL.
I have had good tenants too and believe, wholeheartedly, that they should also have rights to protect them from the rogues out there. Sadly all I can ascertain is that thr proposed changes above are harshly targeted towards Landlords.

Dog Walker

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14:42 PM, 1st February 2025, About A week ago

Reply to the comment left by robert fisher at 01/02/2025 - 11:52
Very valid points, absolutely.
I thought it only fair to make the OP aware of both sides of the coin.
There are many things that are set to kick in that could completely change the game.
These include; EPC rating of C or above by 2030, restriction of guarantor requirement, abolishing S21 eviction notices, extension of rental arrears period before court action can be taken against the tenant, protection of tenant's UC funds against rental arrears. The list goes on. While they do not burden us today, they are just around the corner.
Another concern is the removal of the Assured Shorthold Tenancy and how that may affect landlords, alongside the proposed measures/rights that courts might receive to rule that a tenant in arrears will be worse off if evicted (who wouldn't be?!) and therefore award the tenant a right to stay in that property for given time, presumably at the cost of the LL.
I have had good tenants too and believe, wholeheartedly, that they should also have rights to protect them from the rogues out there. Sadly all I can ascertain is that thr proposed changes above are harshly targeted towards Landlords.

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