Singing Pig

so, i am 24, just about to complete on my first BTL prop. I was going to use the good old instant remortgage through Mortgage Express until they decided to take it off the market. cheers! So i have had to folk out 9 grand to invest into this comparatively cheap BMV, which is fine because i will release it a little later down the line.

However, how is it possible to build a substantial portfolio in a short time frame with out buckets of cash on the hip if instant mortgages and no money down deals are off the market. I would love to know how you guys are doing it, because i am assuming the average person doesnt have 50-100k just chilling around for prop investments.

Any thoughts welcomed

cheers,

 Jon

 

Hi Jon

 

Visit www.elitepropertyuk.com or send me a message with what kind of stock you are after, location and budget etc. I think we might have some options open to you.

 

Many Thanks

 

Sohrob

Hi Jon,

 Have a look at www.horizonhp.com/treic50 for some useful tips, we provide a comprehensive portfolio building service, from sourcing, negotiating BMV and providing 100% finance.

 Richard

wetdogg:

so, i am 24, just about to complete on my first BTL prop. I was going to use the good old instant remortgage through Mortgage Express until they decided to take it off the market. cheers! So i have had to folk out 9 grand to invest into this comparatively cheap BMV, which is fine because i will release it a little later down the line.

However, how is it possible to build a substantial portfolio in a short time frame with out buckets of cash on the hip if instant mortgages and no money down deals are off the market. I would love to know how you guys are doing it, because i am assuming the average person doesnt have 50-100k just chilling around for prop investments.

Any thoughts welcomed

cheers,

 Jon

 

Surely this is good news.

 

If you want to invest in property you should have to invest your own money, otherwise you are not sharing the risk.  It is precisely all this no money down loans that are leading to record breaking bankruptcies of property investors, trend that looks like it is increasing.

give me strength .... "should" have to invest your own money.  eh?  what's "should" got to do with anything?  "record-breaking bankruptcies of property investors" .... eh? ... which are these then?  you haven't actually got a clue have you?

Pod:

give me strength .... "should" have to invest your own money.  eh?  what's "should" got to do with anything?

 

Its got everything to do with it.  It leads to a sustainable banking system and shared risk. 

 

 

Pod:

"record-breaking bankruptcies of property investors" .... eh? ... which are these then?  you haven't actually got a clue have you?

 

You might not of realise that since the beginning of buy to let the number of landlords has risen dramatically, their properties  hold the biggest proportion of properties in many years.  Now repossessions are rising fast.  If you look at any auction you will see a large percentage of the properties are buy to let.  The percentage at auction is far higher than the percentage that buy to let has in the market place.

 

Hence buy to let is the most unstable part of the housing market. 

"shared risk"?  that is a matter of opinion.  where do you draw the line ...0,5,10,15,20,25% deposit?  it's all arbitrary, as long as the lender prices the product correctly, the applicant & the investment itself is considered, it is surely a matter of opinion how much deposit makes the lender's position "safe"?  a mate of mine earns £100k a year ... has a BTL house he subsidises by £100pcm.  whatever you might think about the investment, the risk to the lender is minimal ... compare that to another guy earning £15k (the min salary for many BTL lenders) ... if things turn sour ... the lender has a far, far higher risk with the low-earner ... so ... it's not just about the deposit ... although it is a factor.

Pod:

"shared risk"?  that is a matter of opinion.  where do you draw the line ...0,5,10,15,20,25% deposit?  it's all arbitrary, as long as the lender prices the product correctly

 

It was exactly that thinking that caused the credit crunch.  What is known is house prices are as much as 50% overvalued maximum.  What also is known is that house prices have fallen for the last 8-9 months.  This trend is likely continue for a certain amount of time with a certain amount of falls.  Now the deposit should be decided by the bank to mitigate against these falls.  Now in the current market the banks are typically going for 20-25% deposits.  On top of this they are turning down mortgages on new builds and other vulnerably priced properties.

 

The days of  cheap inter bank lending are gone, hence the banks have to use their own money again.  So they aren't going to risk their limited funds on risky investments in downturn market.

 

 

 

Pod:

the applicant & the investment itself is considered, it is surely a matter of opinion how much deposit makes the lender's position "safe"?  a mate of mine earns £100k a year ... has a BTL house he subsidises by £100pcm.  whatever you might think about the investment, the risk to the lender is minimal ... compare that to another guy earning £15k (the min salary for many BTL lenders) ... if things turn sour ... the lender has a far, far  higher risk with the low-earner ... so ... it's not just about the deposit ... although it is a factor.

 

I have to mostly disagree with that.  You have to do a vulnerability assessment of both parties and identify the hazards that threaten their property.  The most significant one is obviously job loses, disregarding savings it effects both parties equally.  Remember many high earners in the city are being made redundant at the moment with many more forecast in the future.

 

Where your friend is more resilient however is the more frequently recurring hazard of void periods.