ad

Help appreciated - 18 year old :(

P

Prakanta

New Member
Hi, so I’m an 18 year old and I want to get into real estate - want to build passive residual income flows and ultimately get to around £20,000 residual monthly income at which point I’d consider myself beyond financially free and will reach my financial goal.

I have 2 or 3 questions which I’d love to have answers for by those of you who are far more experienced.

(1) How do I find myself a mentor?
I’ve been convinced that having a mentor is the best way to ease yourself into real estate without making the newbie mistakes that most are prone to but am completely lost as to how I find one (is it online? Do it cost money?) - just can’t find anything on this.

(2) Buy-to-let problems?
Ok, with the tax changes that are going to be fully set by 2021, what are people’s opinions on buy-to-let - of course with it being harder to generate positive cash flows, rent prices will go up to compensate and people will tend towards incorporation. Though, this may maintain positive cash flow, taking out the money for personal income will lead to even higher taxes (from what I’ve read) - though passive residual income is linear with my financial stance, I don’t like the idea of higher taxes and the fact that if you choose not to take out money and suffer tax losses, these funds are pretty much illiquid so can’t be used for my month to month expenses as a normal person - maybe I’m completely wrong here.

(3) If not buy-to-let then what?

By 2021, what will be the best way to then generative residual income. Never been a fan of wholesaling or BRRR even though they are lucrative as passive income is what excites me the most. If not buy-to-let, how else is one, in line with the tax changes, meant to buy and hold and generate passive residual income flows.

Sorry I have one more :)

(4) How do I start by the time I’m 19?

By the time I’m 19, I’m sure enough that I’ll have around £20,000 for a down payment on a property but I don’t have any lines of credit and from what I’ve heard you need 2 years of employment in the same industry to apply for a loan (maybe this is the US actually). Anyway I heard that most lenders will not let individuals buy-to-let if they do not already have a residential property. So (1) how do I apply for a loan and moreover (2) how do I get started since buy-to-let, if I have interpreted it right, is no longer that enticing for me.

Genuinely appreciate it if someone would reply to these questions as it seems there are quite a few barriers to entry for a young person still into real estate. Thanks for reading through all of this mess if you did get to the end :)
 
R

realdeals

Active Member
I think there used to be a mentoring program on this forum? Maybe admin might be able to help on this one?
 
D

diyhelp

Active Member
Some of the tax changes to BTL cannot be avoided (unless you go down the company route) but remember, the changes to mortgage interest relief will only impact higher rate tax payers at the moment.
 
T

totallyproperty

Administrator
Staff member
Hi, so I’m an 18 year old and I want to get into real estate - want to build passive residual income flows and ultimately get to around £20,000 residual monthly income at which point I’d consider myself beyond financially free and will reach my financial goal.

I have 2 or 3 questions which I’d love to have answers for by those of you who are far more experienced.

(1) How do I find myself a mentor?
I’ve been convinced that having a mentor is the best way to ease yourself into real estate without making the newbie mistakes that most are prone to but am completely lost as to how I find one (is it online? Do it cost money?) - just can’t find anything on this.

(2) Buy-to-let problems?
Ok, with the tax changes that are going to be fully set by 2021, what are people’s opinions on buy-to-let - of course with it being harder to generate positive cash flows, rent prices will go up to compensate and people will tend towards incorporation. Though, this may maintain positive cash flow, taking out the money for personal income will lead to even higher taxes (from what I’ve read) - though passive residual income is linear with my financial stance, I don’t like the idea of higher taxes and the fact that if you choose not to take out money and suffer tax losses, these funds are pretty much illiquid so can’t be used for my month to month expenses as a normal person - maybe I’m completely wrong here.

(3) If not buy-to-let then what?

By 2021, what will be the best way to then generative residual income. Never been a fan of wholesaling or BRRR even though they are lucrative as passive income is what excites me the most. If not buy-to-let, how else is one, in line with the tax changes, meant to buy and hold and generate passive residual income flows.

Sorry I have one more :)

(4) How do I start by the time I’m 19?

By the time I’m 19, I’m sure enough that I’ll have around £20,000 for a down payment on a property but I don’t have any lines of credit and from what I’ve heard you need 2 years of employment in the same industry to apply for a loan (maybe this is the US actually). Anyway I heard that most lenders will not let individuals buy-to-let if they do not already have a residential property. So (1) how do I apply for a loan and moreover (2) how do I get started since buy-to-let, if I have interpreted it right, is no longer that enticing for me.

Genuinely appreciate it if someone would reply to these questions as it seems there are quite a few barriers to entry for a young person still into real estate. Thanks for reading through all of this mess if you did get to the end :)
Hi Prakanta,

We do indeed have a mentorship programme on this forum, with our CEO and 'For Dummies' book author Nicholas Wallwork. You can read more about his mentorship scheme on this page: https://www.propertyforum.com/nicholas-wallwork-mentorships

We also have a number of free ebooks that might be a good place to start - one is pureply about creating Passive Income. Please do come back to me if there's anything else I can help you with: https://www.propertyforum.com/educationalebooks

Best wishes,

Kelly
 
Nicholas Wallwork

Nicholas Wallwork

Editor-in-Chief
Staff member
Premium Member
Hi Prakanta,

I'll try and answer a few of your questions quickly here for you...

(1) How do I find myself a mentor?
I’ve been convinced that having a mentor is the best way to ease yourself into real estate without making the newbie mistakes that most are prone to but am completely lost as to how I find one (is it online? Do it cost money?) - just can’t find anything on this.


As Kelly mentioned I do mentor a handful of clients on a 1-2-1 basis, you can read more about this here: https://www.propertyforum.com/nicholas-wallwork-mentorships

There are not many other 1-2-1 mentorships out there, mostly there are property investment courses where larger numbers of students attend. Be careful when picking a course as some are good and some simply aren't! Do your due diligence and Google the operators and people behind them. Check on here and other forums to see if anyone has had a bad experience. I'd also recommend you start your journey with all the free information that's out there first so you get maximum value when do you work with a mentor, that way you'll be focusing on specific topics or issues you've got rather than just learning the basics. Read all the property forums out there and ask questions, read all the experts books and become a sponge for knowledge! Once you've hoovered up all the free or cheap educatoin you can you'll then be better prepared to work with a mentor to build your property business fast and with less mistakes.


(2) Buy-to-let problems?
Ok, with the tax changes that are going to be fully set by 2021, what are people’s opinions on buy-to-let - of course with it being harder to generate positive cash flows, rent prices will go up to compensate and people will tend towards incorporation. Though, this may maintain positive cash flow, taking out the money for personal income will lead to even higher taxes (from what I’ve read) - though passive residual income is linear with my financial stance, I don’t like the idea of higher taxes and the fact that if you choose not to take out money and suffer tax losses, these funds are pretty much illiquid so can’t be used for my month to month expenses as a normal person - maybe I’m completely wrong here.


Great to see you've read up on the topic of taxes and specifically "section 24" which is the removal (over time) of being able to claim mortage interest relief from your rental income. Yes this will (and is) having a major impact on the sector but it's nothing that can't be overcome for the serious investor. If anything I see this as an opportunity as the less motivated and driven investors will exit the market leaving the more professional and determined ones to succeed even further! There is opporutnity in every situation remember! There are also some better ways of dealing with the tax changes and incorporation is ofent NOT the right route (as you quite rightly identified can led to higher taxes if you need the money our of a company for income). I can't go into more detail on this thread as it's a huge topic and one that needs careful consideration for your personal circumstances. Suffice to say that it's not a barrier to entry if the correct planning is implemented.


(3) If not buy-to-let then what?
By 2021, what will be the best way to then generative residual income. Never been a fan of wholesaling or BRRR even though they are lucrative as passive income is what excites me the most. If not buy-to-let, how else is one, in line with the tax changes, meant to buy and hold and generate passive residual income flows.


Really the answer to this is in (2) above... buy to let is still very viable (if not more so than ever!) with the right advice, corporate stucture and tax advice.

If you didn't like the idea of buy to let after all of that then here are some alternative ideas for you to research and see if the strategies might ignite a passion inside you! I cover these and many more in my latest book "Investing in International Real Estate For Dummies":

https://nicholaswallwork.com/investing-in-international-real-estate-for-dummies

How about:
HMOs (an extention of buy to let but with higher yields due due multiple occupance)
Serviced accomodation
Holiday rentals
Lease options
Rent to Rent
Hotels, Guest Houses or Halfway houses


(4) How do I start by the time I’m 19?
By the time I’m 19, I’m sure enough that I’ll have around £20,000 for a down payment on a property but I don’t have any lines of credit and from what I’ve heard you need 2 years of employment in the same industry to apply for a loan (maybe this is the US actually). Anyway I heard that most lenders will not let individuals buy-to-let if they do not already have a residential property. So (1) how do I apply for a loan and moreover (2) how do I get started since buy-to-let, if I have interpreted it right, is no longer that enticing for me.


I would highly recommend you speak to our mortage broker partners at Vantage Finance they will help you apply for any loan that might suit your needs. They will let you know exactly what you can lend and when, what deposit you'll need e.t.c. Please DM me if you'd like their details for an introduction or you can find their details all over the forum.

I would also suggest that one strategy to get going might be to live in and rennovate your first couple of deals as your personal residence. It kills 2 birds with one stone by giving you somewhere to live whilst doing your first deals. Also you won't pay any tax as it will be your primary residence.

There are also lots of other ways to raise create finance through JVs and partnerships e.t.c. so check out my book above for a full chapter on this topic as well!

Good luck in your journey and we hope to hear more from you! We will help as much as we can...

Kind Regards
Nicholas
 
Top