What would you do with £80k?

[RAWJ]

Hi All,

This is my first post here. A quick scan down the first couple of pages highlights that there are frequent posts from newbies such as myself, wanting to know how to get started.

I'm new to property development, but have been keenly researching over the past 12 months, observing house prices, and even gone to a few auctions to get the feel for how they run on the day.

I recently sold my first house, after a split with my partner, and have a saving of £80,000 and no current mortgage. I have moved into a rented accommodation with my new partner. I am in Oxfordshire, so property prices in this area are high.

I am self employed. I work in the IT industry, and I know that all the information I may need is available to me via the internet and books, but there is no substitute for experience.

I have no debt, and generally speaking I don't like to borrow. I would consider a mortgage, but would prefer to make small, low risk and manageable steps during my first years.

What would you do in my situation?

Thanks for any replies, it will be really interesting to hear views on how I can grow the saving I have.

 

[fenella]

Buy the retirement flat for sale in Ashburton, Devon (with Your Move, Newton Abbot). The vendor will sell to investors or cash buyers for 70K (£15K below market rate) for a quick sale.

 

[Barny]

Hi there,

What is your goal from investing your 80k, are you looking for immedaite income in the form of decent profit per month or are looking at it long term in the form of capital increase, or both (obviously far harder to achieve!)? Depending on your answer will give you different options and point you in different directions but in addition, a lot would also depend on the house prices that you're looking at?

I don't know Oxfordshire at all in terms of the housing market but as an example, in the Suffolk, Cambridgeshire and Lincolnshire areas where I have my BTL properties, worthwhile investment properties in the 1 or 2 bed flat(s) / house(s) category vary between £70k - £130k with rent ranging from £450/m to £750/m so decent yields are available but in terms of capital growth, my properties in Cambridgeshire and Lincolnshire have a reasonably low growth (approx. 2% per year),unlike my Suffolk property which has averaged 5% over the last 3 years which for a house worth £150k in 2012 and now at approx. £175k isn't a bad deal for me considering I'm only on an interest only mortgage at present.

Interested to hear some more details though and maybe could suggest afew ideas fro you based on your targets and house prices!

 

[RAWJ]

Thanks Barny - that was helpful.

I think I should have given a bit more info to start with.

What I'd really like to do is buy, renovate and sell. I'm not after a long term investment. I'd like to take on a few properties a year (one at a time),in the first instance, to find my feet. As my experience and knowledge grow I'd pick up the pace hopefully.

I'm wondering how feasible it is to get going on this kind of thing with such a relatively small amount of capitol. Would it be an option to take out a small mortgage to make up the numbers in the early days? And what options are available for a mortgage on a property that I don't intend to keep for more than, say, 6 months?

Thanks again.

 

[Veronica]

I would suggest you go to some local auctions to get an idea of what is available. Often properties that are auctioned are cheaper properties which need varying amounts of renovation or updating.
Make sure before buying any property at auction that you read the information pack for the property to ensure you don't have any nasty surprises.

Veronica

 

[Duncan Pattinson]

You will need to carry out a mortgage market review MMR and to do that you will need to contact a regulated Mortgage Adviser. They will be able to advise you the best deal that meets your needs.

Type in MMR Mortgages and the location in the Uk and you will find your adviser fairly easily

Hope that helps