General (main property discussion here) - buying the second place

Hi all,

New to all of this. I have a flat i bought a year ago for 155,000 in london, It now worth about 185,000.00.So want to re-mortgage and take out the 30,000 and put this into Buy to lets.

What i am trying to work out is, what is the best way to proceed, buy 2-3 cheaper house in the north around 40,000 each, try and get a good yield ( But the problem i can see here is that value of the house will not go up that much)

or

Do i buy a a couple of flats in london that have a lower yield, but have more scope to grow in value faster.

I guess my question here is, to grow a portifilo of flats, you have to remortgage your flats that have gone up in value, so if you buy chaeper flats that don't gorw inb value, how can you keep going on buying further flats / houses.

Hope that makes sense?

Just want to know which direction is best to start looking at buying. I am ready to buy soon.

Thanks CARL

Hi Carl, I get your drift and I like your thinking! However,do remember that buy buying "oop North" you will have to pay someone to manage your property/ies.Some of these thieving bastards will charge you between 10-15% plus vat,and do very little for the money they steal from you.I know this does not answer your question,someone more experienced/qualified will be along soon to do that.I just wanted to alert you to the problem of managing agents(and also to get it off my chest) Good luck!!

Thanks for your reply Simon.

My current flat i owe i have it rented out and managed here in london, they charge 5% for full managment. I have read on forums that in other areas of Britan it can bee up too 15%

I only own i flat right now, and have reted that out to tennants, While i share a place with my girlfreind which i rent wit hher.

Just went to a mortgage broker yesterday. Run some figures with me. On my cuurent flat wich i bought for 155,000 with a mortgage left on it for 147,000, and is valued around 185,000 i can pull out 10,000 if i do it the normal way.If i say i stll live there i can pull out 20,000

anyway - so that means if i go the route of the 20,000 i can get buy to let mortgage for 120,000. Hmmmmm

120,000 in london will not buy you much - so not sure how to progress - The upnorth way, or look at a new build somewhere.

The other option i was told was i could sell my first place, profit 30,000, then he could arrange a mortgage for me for 300,000.00 - Start again someone else - maybe london again

Any thought people - Really not sure what is the best route here, start a buy to let portfolio with around 120,000, while keeping my firtst falt - or do i sell, and upgrade to a more expensive property somewhere for around 300,000