We are remortgaging, and will have about Â£130k up front, plus up to Â£350k in borrowing, to invest in property.
We are torn between
1 putting it all into a one bed flat in one of the new developments in Stratford to take advantage of the Olympic park, Westfield, already decent transport links, as well as crossrail to come. The yield wouldn't be great, and there is service charge. But it might appreciate in terms of capital value quite well
2 putting about 350-400k into a 2 bed 2 bath flat in somewhere more it and coming like woolwich and buying something smaller in a few years time as well. Crossrail will come in a few years, and it is on the DLR. The yield would be better than in Stratford, but maybe not as great an increase in capital value, though the property would be cheaper
3 buying two safe properties in places the south east which will probably mot accumulate much in terms of capital value, buy T will rent easily at about 5 % yield
4 something else, and all ideas and recommendations for areas welcome!
We live in the south east.
This would be our first investment property, but we may well buy again in a few years time. We would need to rent it out, but would also be able to cover the mortgage if we couldn't rent it for any reason. We are looking for a mix of capital growth and rental income.
Obviously there are pros and cons to everything. I'd be interested in your opinions.
Try places like the property hub and property tribes for information from landlords.
There are lots of opinions about which type of property but in London you need to become an expert on the micro markets. Which type of tenant do you want? Then buy the type of property they want in the area they like. Lots of people say to avoid flats as the leasehold costs wreck yield figures. Freehold houses are more profitable normally. 3 bed houses seem to be what families in our area want and they stay a long time in good ones. Long term tenants is what you want to avoid hassle. Make sure you take into account agent costs (and their poor service) in your sums. Also consider buying where you can self manage as letting someone else choose your tenant is not a great way to get someone decent! Good luck