UK Landlord Forum / Life

Hello,

I currently live at home but managed to save up enough to buy my new home - I completed on Friday.

As things always do, fees came to more then I expected and my decorating budget has been blown on extra fees. I am considering letting out my home for 6 months (I can continue to live at home) The property is worth £199,500 and it looks like similar properties in the area rent out for about £700 pm.

If I live at home, I will be expected to pay may parents about £350 pm, my mortgage is £333. My question is, is it worth it, are there lots of fees I would have to pay upfront for renting out a property? Even if I brake even, I will still save more money as I won't have to pay much for food, bills ect, and I will pocket most of my monthly pay check from work.

Any thoughts? Thanks very much.

Lorna

£700 per month on an investment of £200,000 doesn't sound great.

Few examples from me (rent vs. value)... £500 on £85,000, £500 on £98,000, £610 on £125,000, £850 on £150,000, £900 on £189,000, £900 on £200,000, £1,200 on £200,000... so there are variations, of course, but the £700 is low. Do you know why? Have you overpaid for it? Are you undercharging on rent? The issue, as always, with a plan like this is your expectation that the property will be returned to you when you want it back, i.e. in 6 months. If they do not leave then it could be 9, or 12... or longer if you're green and they're canny.

Be careful.

Thanks for the reply. Well looking at the history of the almost identical property next door (my kitchen is nicer) in 2012 it rented out for £600 pm so what I say is a guess I haven't asked for any quotes or anything. Maybe I would get more then £700 I don't yet know.

I take it you've got a residential mortgage on this residential house?  It would be against the conditions of your mortgage to let the house out.  You will not be granted a consent to let from them either due to timeframes.

If the expense of the house is expensive look at getting lodgers in with you.  There is a generous tax limit on the income generated by lodgers and a lot less 'stuff' that you have to do, unlike being a landlord.

Thanks for your reply. I do have a residential mortgage, but I phoned them up and they said I could apply to rent it out - the man said there should not be a problem. Unfortunately it is only a one bedroom house so no room for anyone else whilst I am there