Getting Started...

[TGR]

Hello everybody.

I have just joined up to the forum after shadowingly browsing for a few months now. I’d like to say it is a whirpool of great knowledge and advice here, which I am thankful for myself.

A bit of background about myself. I’m 22 years old. I have been working in property since I was 18 starting as an office junior in an estate agent.

I have been a lettings negotiator and a sales negotiator for a few years working in the Nottingham area. Dealing mostly with residential sales and also the sale of student let properties within the student hubs around the universities. I now work for a company doing facilities management and property maintenance management on a portfolio of around 1900 properties within Scotland. There is also the potential for a portfolio of properties within the London docklands to come on board, which we are all looking forward to.

I just wanted to take the chance to say hello to everybody and potentially ask a few questions about things that currently concern me.

I would like to ask the landlords who are on here, how they started up getting properties and how they managed to step that up into something profitable, be it cash or equity. I’ve been working hard and saving since I can remember really, and it’s always been for a personal gain for me, in this case I’ve wanted a new car for quite a few years, so a BMW M3 at 12 grand has mostly been my current thing to aim for. But then as I grow and learn I always think to myself, would it be foolish to drop all that money on a car, when I could potentially keep saving for a deposit. Get myself a property - get that let at a decent rental income pcm? I still live at home, and thankfully enough rent free. Though I cannot say how long this will continue, before im asked to fork something out, or I feel I need my own place. I think probably the latter.

I guess im a victim of being at work and thinking, I don’t think that this is going to solely be enough to keep me ticking over at a happy rate my entire life. And Im looking for advice and thoughts about which direction to go and what people would do to effectively get maybe a few properties and hopefully some decent money. Don’t get me wrong I don’t want to be Richard Branson, but I wouldn’t mind with being able to have a somewhat comfier income in a few years time towards my late 20’s and be able to enjoy a nice car and a few holidays then, maybe even my own place. I just figure that the window of opportunity to enjoy any money you have might cut off one day, and I don’t want to be able to not have done anything with my time, nor have anything to show for it. I look at my clients and I always think, how have you got 68 properties? I wonder if they are all paid for and I just think, how can I get a few and see the rewards of this.

Anyway to cut a long story short how have you managed? Am I too young? Would I be better off just keeping my head down, gaining more experience within property industry and eventually attempt to get a higher paid job, then start this kind of thinking?

I have all the ambition in the world, but I don’t have much of an idea of how to get on the road to it all. Cash I guess is key. 15,000 a year isn’t the best. But you do what you can with what you have. I know there is a lot to bare in mind and I know that research is also key and preparation. But I feel I am in early stages and ideas/direction for one day in the future is my first aim.

Wishing you all well.

TGR

[catdog1121]

I would say you pretty much have it right, the simple truth is in the past people made the huge money on increases in house prices, they used the increases, releasing the equity to buy more houses, im going in on monday to sign a deal on another house, the previous owner bought in 1996, since then the house has earnt them 8333 per year compared to the price im paying now.

Those days at least for the next 5-10 years are over, you will not see such big rises and we will see after inflation at least falls if not real falls. The boat has sailed so to say, in these times its all about rental income rather than captial gain. In these terms its the old saying money makes money.

My theory at the moment is keep plenty of equity in the property, the returns on rent are higher than I would get in a savings account and with inflation although my properties may not increase in value the loans on them will be inflated away to a certain extent.

Its a risky game and in my opinion you do have to be quite cash rich, especially in the south. You may be better off shelving your plans, you will want to move out at some point im sure pretty soon. Have you considered instead of rental thinking about buying a run down property at a cheap price and doing it up over a period of time, if your any good at DIY or willing to learn, could be a good way to start getting on the ladder, buy it as a residential (your principle property). You can then do it up while living with parents, you may be able to get family and friends to do some work on the cheap, live in it for a few months, sell for a profit, move back with the parents and start again with a bigger property.

You clearly know the property im guessing in your area so im sure you could work out if something was a bit of a bargain, make sure you buy in areas that are easy to sell (there are still some of those areas as im sure you know), the bargain properties often only stay on the market a few days so check rightmove on a daily basis and have a mortgage in principle ready so you can jump when the time is right, if you do this I would also say patience, ive had cash ready for another property for 18 months but nothing came up in the area I was looking for the right price, something then did and I snapped it up within a day of being on the market.

[Dan_Manchester]

Welcome to the forum,

Firstly, property investment is a long term strategy (as apposed to property trading). I'd say try and understand both markets as well as you can then decide which is for you.

On your current income you aren't going to get a BTL mortgage so buying something for yourself, renovate then either let or sell (of course after living in it for a reasonable time of time for tax purposes) could be a good starting point.

The experience gained from buying somewhere and renovating it will give you an insight into property.