Saturday, November 3, 2007

BTL is now a long term investment; who’d have thunk it

What is buy to let? - ARLA publish guide exploding some myths

ARLA have published a guide on buy to let, here's a snippet that caught the Firstrung teams' eye, given that most buy to let investors do not and cannot make this business model work;"Buy to Let is a medium to long-term investment, typically 15-20 years, and it is an investment that takes account of both capital appreciation and rental income." For every 100K borrowed (at on average 7% on an interest only buy to let mortgage) the buy to let landlord needs to re-coup £700 per month in rent, not allowing for repairs renewals and voids, to simply break even. This is for the most part an impossible goal. Firstrung stands by its statement in 2006, that buy to let broke as a business model when individual BTL rates reached 5%.

Posted by converted lurker @ 05:02 AM (439 views)
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One thought on “BTL is now a long term investment; who’d have thunk it

  • Anyone who can predict what houseprices are going to be in 15-20 years time deserves to make a fortune.

    Considering buy to let has been around for roughly 10, it’s interesting to know how anyone can know it’s a long term investment at all?

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