BTL Case Study: Step 1: Buy a House!
Here at WitLet & WitSell, we have discussed with so many people why BTL is still a potential winner when it comes to investing your money. Does good old “Bricks and Mortar” still provide the safest and most reliable means of investing your hard earned money? We think so and we have decided we are going to put our money where our mouth is! So, with no further adieu, I present to you, our 4 bedroom BTL investment on Oak Road, Rivenhall!!!
The idea we have is to take a run down, old property (for a good price), invest some money to “do it up” then maximise our rental value! When I say we’ve have kept our powder dry waiting for the right property, we REALLY mean it! Off market purchasing is an ideal way to maximise the value of your property but you do have to be in the right place at the right time! Plus it keeps those pesky estate agents (cough cough) at bay. In this instance, we know the person living next door who I have said for years how much I love their house! When he got wind of the place being vacated… a quick text and 5 minutes late a number, we could conclude a deal for the property at a price we thought had potential moving forward.
We purchase our properties in a specific limited company. This is very much. two edged sword and it’s certainly not a “one size fits all” solution to BTL property. However, mortgages for limited companies (in our experience anyway) are far more intense than a regular (for lack of a better word) BTL. I won’t sit here boring you with the millions of different ways I tore various lumps of my hair out when the solicitor would ask me for some other obscure item (my personal favourite being letters of non crystallisation for a company that had no floating charges) but we persevered and as of 20th December 2023, we were handed the keys to the house (I need to hybrid the happy birthday song to Merry Christmas for some kind of “Merry Christmas to me” lyrics) and we could start planing how we can make this work.
The rules of the game are as follows:
- We have no skills. Labour costs must be accounted for so we can get a real accurate assessment of the money we put back in so the final sums can demonstrate how BTL can still work. But unskilled work we will do (ripping out, trimming grass, pulling out weeds etc.)
- Cheapest is not always best. We will publish quotes and some times we may spend more than we need to but it will be in the belief we can maximise our rent by spending a little more… But we will look what we COULD have achieved if we had gone cheapest all the way.
- We’ll endeavour to go into much detail as possible but in some instances, we will need to be slightly confidential but all the way through this experiment, we will look to be as transparent as possible. Obviously, if you ever have a question, feel free to email firstname.lastname@example.org
I’ll stop boring you at this point. We’ve invested in a Gledhill direct closed hot water tank and we are going to see how far we can stretch our funds using some 0% financing and cost splitting over time and try and come up with some ingenious money saving tips and some savvy shopping around! Stay posted for updates as we get on!