Net Yields and Gross Yields on Buy To Let UK Property
As I am speaking to more and more investors that are looking to invest in Buy to let UK property, I have found a great many really do not understand all the expenses that are attributed to Buy to let UK property. So many think they will simply get 8% return. They forget about voids…they forget about tenants that do not pay their rent on time….they have no idea of Universal credit which is coming about shortly…they have no concept of costs of repairs. Some are deluded if they see a 9% guaranteed Student housing program with guaranteed for 2 years.
What happens after the 2 years and they have grossly overpaid for their Buy to let UK property? Simple answer…they lose money potentially.
I think it is good to have various avenues of investment. I like converting vacant redundant commercial into flats. Margins are high and work is relatively straight forward. I try to tenant with councils or charities as I do not want to manage…I do not voids…I do not want maintenance.
Another process we do is convert houses into HMOs and enter long term contracts with the Home office appointed manager in our area for social housing. We create value by making a HMO. We increase our profits by renting by the rooms…approx 50-55 per week depending on the area. Shortly we are starting 4 of these HMO properties. Watch for more on our blog showing the refurbishment. If you have any questions please contact me.
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