Tradefair & Financials
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Or in todays market is the likely fall in capital value of a house make rental yields a secondary consideration.
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Varies from town to town.
Savills’ map of the UK shows that yields are typically lower in smaller affluent towns and cities such as Bath (4.37 per cent), Edinburgh (4.59 per cent) and Brighton & Hove (4.72 per cent), and higher in larger cities with a greater industrial past such as Manchester (6.43 per cent), Birmingham (5.68 per cent) and Newcastle (5.48 per cent). Yield differentials are also driven by the types of property purchased, with one-bed flats providing the highest yields. I imagine these figures don't take into account any voids or letting agent fees etc. OR A fifth of private-residential landlords have had tenants in rent arrears over the last three months, according to new research published today by the National Landlords Association. During Q2 2010, just over 21 per cent of landlords experienced rental arrears. This represents a small improvement on the previous quarter when 24.5 per cent of landlords reported the same. However, the average amount of outstanding rent arrears has dropped significantly from £978 in Q1 to £799 in Q2. This could indicate that financial pressures on tenants have started to ease as the fragile economic recovery continues. “Rent arrears are a serious problem for landlords all over the UK said NLA Chairman David Salusbury. It is good to see the latest data which represents a small improvement in that more tenants are keeping up with their rent payments and not putting pressure on their landlords who may well have mortgage repayments to consider. It is critical that tenants and landlords communicate and work together to tackle financial problems before they result in a loss of rent or even the tenancy.” The NLA has recently launched a rent arrears service which gives landlords the option of instructing the NLA Rent Arrears Rent Recovery Team to collect outstanding rental amounts from tenants. Acting on a landlord’s behalf, NLA Rent Arrears will contact tenant(s) by telephone or letter, visit them at the rental property, serve notices (where appropriate) and undertake possession proceedings. A 5 year fixed rate bond paying 4.9% is a much safer option. |
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A 5 year fixed rate bond paying 4.9% is a much safer option.
Not really. You can pick up a 2 bed terrace in Mcr for about 60k. Put it with a managemen company chargin 8% and forget about it. Rental income £425/month or £391 after the deduction making £4692 a year, or 7.82% on your mney. In 5 yaers the house will still be worth 60k at least, they are a piece of piss to rent out. |
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You assume that you'll rent it for the whole 5 years solid.
In 5 years time it will be worth what someone is willing to pay for it. You haven't included the costs involved in buying and selling. On Rightmove there are 1000+ properties to rent in Manchester between 400 and 500p/m There are another 1000+ below 400p/m. piece of piss to rent out---I don't think so. |
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JML 'I am only going off my own experience in North Mcr. I rent out 5 properties through a management company, they collect the rent and take care of everything, I honestly don,t know who is renting them.
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you are right....massive demand to rent property...no price crash in the uk
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skipp 25 Jul 10 10:17
you are right....massive demand to rent property...no price crash in the uk All I can say is it's worked for me, I've spent approx 5k refurbin them, and they are easily worth my total outlay. As I have stated the management company take care of everything. I am in this for the long term, the alternative was to leave the money in the bank earning 2.5%, while getting shot to bits by inflation. |
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It seems you've only been in the buisness a short while.
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You are correct, I have. 5 terrace and a semi, in the last 2 years total cost 384k in total, income after management company £29900, what am I doing wrong? In the 2 years No one has moved out and no one has been behind (within reason)on the rent. The boiler went on one costing £600 to sort out and the drains on another costing £250 to sort out, both done by the mangmt co. Still not sure where I am going wrong? Any advice would be appreciated.
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well done maineroad - keep going. You will be on the times rich list whilst others still renting.... are your props around south manc area ?
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I won't make the times rich list, but if you want to take the pis then fair enough, once again I am struggling to see where it can all go wrong. All the properties are in North Mcr, and as soon as a to let board goes up enquires come in, and it's all left to someone else to sort out.
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You've got more chance of making the rich list than Skipp
being seen on Mastermind. This thread was all about yields. I like the easy life and would choose the 4.9% bond. You've choosen BTL. No one has suggested that you've done a terrible mistake. |