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scimus

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Posts posted by scimus

  1. Can't believe it's been a year since I last posted here. Bought a house in North Bramhall and had an extension built to it. Doing pretty well at the moment with lots of equity in the house and still have 200k+ savings in personal and business accounts. Now the problem is how to invest all this money, with ultra low interest rates (couldn't believe it when it last dropped) and stocks at their highest and BTLs supposedly doomed :-).

  2. You may well be right. I was only mentioning what my friends had said and it's all very comfusing to me.

    The only reason I've taken an interest is that it's similar to the contractor expense issue.

    There is nothing generous about the expense 'tax relief' or the mortgage interest 'tax relief'; it is standard practice for all businesses to offset costs before profit is calculated. The current proposal is to tax turnover, which is unheard of in business.

    Running a business always carry more risks than a job. But some of the recent political changes seem very business unfriendly. Mind you I'll have much bigger tax bill on dividends next year. You can't blame me for getting a little bit upset? :-)

  3. Interesting...I wonder why one who has a sizable portfolio like this doesn't already hold all these properties in a company structure...

    I have friends in London who knew a lot of BTLers and most aren't concerned. I don't know whether it's to do with lack of understanding or if the particular group are in better financial situation than others.

    Many did say the new rule seems increduless and they expect it to be overturned or at least modified. I know most people here will disagree but from a business point of view it doesn't really make sense and is retrospective affecting decisions made a long time ago based on a different logic and model...oh well that's another debate for another day.

  4. Hey; I am not judging you. You work hard, prepared to travel for that work (my family doesn't like to), early 30s, and you seem to be in a very have solid financial position.

    Are you aware of the proposed tax-changes with expenses for contractors? Might be worth keeping an eye on if you do a lot of travelling. I set it out on this thread.

    With all the changes, including on BTL finance, it could turn soon (year or two). eg yesterday in the FT; Osborne shakes buy to let to its foundations - FT.com

    Thanks for the info. As far as I understand, the changes to tax relief on expenses won't affect limited company contractors outside IR35 so fingers crossed I should still be fine.

    The FT article is old news. The professional BTLers will largely be fine. Incidental landlords on low profit margin will be hit the hardest and they might start to sell to cut the losses. However you never know if that's gonna trigger a price reduction chain effect or if you'll just have a supply issue matched by low demand. I don't really think if I'll be interested in the BTLers' stock of flats, new builds and studenty areas etc.

    But you're right there's no real hurry.

  5. I'm a contractor/work for my own consultanty so can't afford to not take a job elsewhere when work in my area dries up. Working from home is impossible because clients won't allow it. Unfortunately this means having to travel and live away from my family during the week or my family has to move with me which is difficult. Of course I can choose to take a break or take a permanent job but I don't know...the former seems lazy (I'd like to think I don't have such luxuries since I'm only 30) and the latter seems boring and not as well paid. There's always the option of converting to permanent I guess cus a number of companies have offered positions...Oh well. The sacrifice is the pain of being away or being stuck in rented accommodations. I think my husband and I just want to call somewhere home and make it our own - it adds purpose/joy to our lives. And I just need to harden myself and live like other contractors and not complain about travelling :-)

  6. Ha you digged that out! Both are sold now. We keep having to move for jobs and therefore was unable to keep the houses for too long. Problem is, renting sucks, especially since we have pets. We have rented for over a year now so quite keen to buy again. The plan is to stay somewhere for longer this time and if I have to travel for work I'll just travel without moving. We're not stretching ourselves which is the lesson learned. We can now buy with cash or with a little bit mortgage. The experience though is very different this time since we keep getting overbid by someone else. I'm not sure it feels like it's turning into a buyer's market anytime soon.

  7. viewed the solicitors next door when up for auction with I think Mellor Braggins last year.Had a fantastic galleried staircase, easy to convert to a private resi. But the gable end was falling away you could see daylight. so a project for the stout of heart.

    If you are interested in the the property next door get a survey.

    seem to remember it backs onto some factory units.

    The solicitor's was sold for only £160k. I read the planning application documents which looked very reasonable. The gable end that you were talking about - was it the rear or the side?

  8. viewed the solicitors next door when up for auction with I think Mellor Braggins last year.Had a fantastic galleried staircase, easy to convert to a private resi. But the gable end was falling away you could see daylight. so a project for the stout of heart.

    If you are interested in the the property next door get a survey.

    seem to remember it backs onto some factory units.

    You might be interested to hear that a neighbour bought it together with the 3 garages at the back. The work to convert it back to a home has just started.

  9. Train into Manchester is not that much more expensive than from Wilmslow and takes pretty much the same amount of time. Hubby can't drive to work anyway since there's at least a full year's wait on worksite parking space. For me its an OK daily drive to Wilmslow a regular 1:50 mins train to London. Shopping will be on the door step but I'll miss Hoopers and all the nice restaurants. Schools are good just not as good but that's a distant worry. I've thought about Cheadle Hulme but it's probably too residential for us.

    Had lunch in a highly-rated pub today in the area and thought it was OKish. The streets look clean but I can see some empty properties around and rundown factories/businesses. Still haven't made my mind up.

  10. Actually Sharpey you're right I've always travelled from Wilmslow never thought about that.

    Venger, great thanks for all your advise!

    What do you guys think of Macclesfield? I've been starting to look there in the last few days as it's great for transport and quite affordable.

  11. Oh wow I remember seeing that house when it came to the market and thought how lovely, but decided against the location because I wanted to be on the main line to London.

    I have been looking 6 months in Wilmslow but couldn't find anything decent under 350k which is quite depressing...

    Estate agents actually think this wreck could sell up to 250k. We'll see. Renovation can easily add 60-70k on the bill...

  12. I don't know what to suggest re your offer.

    Cash places you in good position though and may be attractive to seller. Could cut back on selling time I would imagine, what with MMR. You're probably still up against some flippers in this market though. I think they're declining in number, but they are some still there. Would be nice at £205K given the works required.

    If seller got turned down for planning at back (access?)... what difference does it make to value now? Lovely garden.

    Pic 8, does all the garden in view belong to that house, or is it showing next-door's garden?

    Good luck - if you're looking to buy it as a home. :)

    The garden you saw is next door's which is much bigger. The garden attached to this house is over-grown and you can only see tree tops :-)

    I am looking to make it into a home.

    Spoke to 2 mortgage advisors. Both said this house is unmortgagable without a proper kitchen. But I suppose flippers will have cash too.

  13. Much has happened over one year and I'm now able to look back and reflect on the decisions we made.

    Needless to say we bought a house near where I worked.

    6 months ago I would have said that buying that house was the worst decision I made in my entire life, because I lost my job, a risk that some of you did point out to me at the time, although the unfortunate incidence was not due to my own failings but the employer cutting the entire project I was due to be placed on and with it 30% of it's workforce.

    Although we did have savings to last us 5 years at least, the psychological burden of having two mortgages was very much unexpected and the lesson well learned.

    Eventually we moved to a new city and found jobs close to each other (I didn't mention previously that my husband wasn't actually working but studying on a full scholarship, so I was expecting him to then graduate and earn an additional set of income for us). Both houses owned by us are rented out now. We've saved a bit over the last 6 month hence are now in pretty much the same position as last year in terms of paying off the first mortgage - albeit now having a 2nd mortgage (with 30% equity) to worry about. The latter one has got fixed interest lasting another 2 years so shouldn't cause us any trouble in the meantime.

    We're renting at the moment but this time not in a hurry to buy again. The plan is to sell one and keep one and wait with patience for another 2008. We survived because we were far from being tied up by the mortgage despite having 2. Most people in our situation would have overstretched themselves with bigger mortgages.

    Another lesson I've learned is that jobs aren't reliable, hence my husband and I are keen to learn new skills and plan to open our own businesses. He's also looking into equity investment and trading so that we'll have a more balanced portfolio.

    This forum has been very helpful and I hope to make more contributions in the future.

  14. Good luck with that. If HPC gets going in sought-after areas which have been somewhat reliant on global stimulus, you could be experiencing similar yields as other landlords have been experiencing, unable to see the wider view of things.

    Possibly opening yourself up to double the effect, with more than one property.

    So people stop going into Universities; town centres deserted and no jobs left. It is more likely that a global crisis will hit where everything goes down, not just HP but every type of assets that is credit related. How will you protect your hard-earned cash? The value of bonds and shares will drop like a stone, cash isn't safe either as you don't know if the bubble will burst by inflation or deflation. Gold is most likely to be confiscated (in fact I do have some physical gold in an offshore vault, just in case).

    What can we do in times of such uncertainty apart from work hard and save hard and move on with our lives? You may think that property isn't a good store of value but what is? We're not buy-to-letters, mind you, buying in sought-after areas give us the flexibility to not having to sell in the case of an HPC. In the long run, however, HP should go up with inflation.

    I actually quite like the idea of selling one of the properties in 2 years time, in which case we'll be mortgage free with a bit of cash, especially if the market is popped up by the "help-to-buy" scheme. Then we wait till London goes down. Sounds too good to be true, doesn't it?

  15. I think your question and also your answer are both tinged with a 'house prices will be stable or rise, houses are a good investment' mentality. That's not unusual, but on a website called "Housepricecrash" you can expect it to be challenged. And challenge it I will ;)

    On the matter of renting for £750 somewhere which is costing £500 per month in mortgage, mathematically right now your logic is superficially sound. But in a scenario of falling house prices how much of a percentage fall would there have to be for you to lose £3k (the annual difference) on your house? Probably not that much, and that skew the maths against you. Plus what will it cost to maintain, what void periods will you get, what will the mortgage rate be when you change your existing residential mortgage to a BTL one...? And then there's the stress of being a landlord, dealing with issues etc.

    Indeed well challenged. But just let me point out the interest part of the mortgage reduces quite quickly for us while rent is unlikely to reduce. The saving is more likely to be well over 3k, given the equity we will have in both homes, which is 50% and 30% to start with, and rising to 90% and 35% in two years time. An 8k reduction in price is a 5.5% fall, which is possible but here's the thing: 1) The area has already seen big reductions since the peak 2) In a crash smaller/cheaper homes see smaller reductions as demand for rented accommodations increase. You're right about maintenance which is sth we'll look at. We're not concerned about voids given the difficulties we had trying to find a place to rent in this area earlier - e.g. contracts were getting signed 3 months before moving in; landlords insist on min 1 year lease, etc. The lender seems OK with giving us permission to rent out when I discussed with them, with a small charge, given that we stay in the house for 3 years.

    You're right in saying we're taking a risk. We'll take a hard look at our situation.

  16. More likely to lose your job under some of the bosses I know, if they saw that, now very common, embarrassing mistake in any form of company letter/email document. I've seen rage. Keep thinking about the pay-rises though, and more homes to buy.

    Sorry will paste into word next time to check before I post, if that annoys you.

    Thanks.

  17. We're actually looking at a 5 year fix, the rate of which is only marginally higher than the 2 year fix. The existing mortgage, on the other hand, is a 25 year offset tracker, which will go up when base rate goes up. Over the last 2 years the offset allowed us to gradually build up a saving such that now 80% of our monthly repayment goes towards capital repayment and only 20% is interest and in 6 months time we could pay off the mortgage, if we choose to.

    Since mortgage rates are lower now than 2 years ago, we could use part of that saving to put down as a deposit, say 30%, and take out a 5 year fix at 2.9% or 2 year fix at 2.5% . If both of us are still in jobs in 2 years time and we have watched our spending as we did so far, we should again be able to pay off the first mortgage, even if the base rate go up a bit. Then we could sell or renting out depending on the circumstances...

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