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Desperate Btl Investors Swarm To Warrington...

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I live in warrington and theres to let signs everywhere!!!!!!!!!! one road full of houses was previously to letand looked like they were owned by one person and now they are all for sale by Halifax!

Trouble spot I would say!

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The yield is shockingly poor.

Lloyds TSB shares are in the top 100 companies and they pay a gross yield of over 6% without any hassle.

But you would have to invest your own money, these people do not have money they have mortgages…

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But you would have to invest your own money, these people do not have money they have mortgages…

spot on.

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But you would have to invest your own money, these people do not have money they have mortgages…

Gross yield doesn't take account for servicing a mortgage or fixing stuff, admin fees, etc - otherwise the return would easily be negative.

*** e.g. 5.9% Gross Yield = £7009 (rent) / £118,024 (cost of property/investment made) * 100%

------------------------------

*** or even if you take out a mortgage @ 5.75% over 25 years (interest only) - using the most optimistic/generous example would show an annual loss:

e.g.

Annual Income: £7009 (rent)* 0.95 [say 5% letting agent fee]

Total Income: £6658.55

Annual Outgoings:

Mortgage payments (25yr IO @ 5.75% ): £565.53 * 12 = £6786.36

Repairs: £200

Service Charge: £400

Total Outgoings: £7386.36

Net Gain/Loss: -£727.81!!

*** Note: These figures are based on a BTL investment made in Warrrington - #1 BTL Hot spot - using a VI report!! :o

Edited by studdymx

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But you would have to invest your own money, these people do not have money they have mortgages…

So would it be possible to take out a personal loan to buy shares with? As a long term investment you might get an increase in the dividend and capital appreciation on the share price? (Which is just the same as BTLer's are aiming for).

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Gross yield :lol::lol::lol:

So by the time you've taken money out for mortgage, repairs, general expenses etc how much would you expect to make per month from the rent?

Edit. I see someone has already answered my question.

Edited by Tatty Teddy

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Gross yield doesn't take account for servicing a mortgage or fixing stuff, admin fees, etc - otherwise the return would easily be negative.

*** e.g. 5.9% Gross Yield = £7009 (rent) / £118,024 (cost of property/investment made) * 100%

------------------------------

*** or even if you take out a mortgage @ 5.75% over 25 years (interest only) - using the most optimistic/generous example would show an annual loss:

e.g.

Annual Income: £7009 (rent)* 0.95 [say 5% letting agent fee]

Total Income: £6658.55

Annual Outgoings:

Mortgage payments (25yr IO @ 5.75% ): £565.53 * 12 = £6786.36

Repairs: £200

Service Charge: £400

Total Outgoings: £7386.36

Net Gain/Loss: -£727.81!!

*** Note: These figures are based on a BTL investment made in Warrrington - #1 BTL Hot spot - using a VI report!! :o

Reading that is enough to put anyone off buying a BTL property......And it's enough to make them sell up if they already have one (or more). :unsure:

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