Buying a house cash, then renting it out

[Savagebeauty]

I'll be selling family home in the next year following divorce.
I should get £600,000.
I live in a very expensive area and do not want to buy here. My plan is to move north within 2 years and live there.
So I will rent in the meantime.

I will have £350-400,000 for a property up there. Am thinking of buying there when I sell current home, rent out then move in myself in 2 years.

Is that viable?

[financialwizard]

Yes, no mortgage lender to get in the way. Just be aware of the fact you will have to self assess with HMRC

[Savagebeauty]

OK. I have a financial advisor but he's away at the moment. It's new territory for me.

[specialsubject]

could well work. (that's how quite a few of us get a bit of return on savings with interest rates so poor) You need to look into all the detail of being a landlord, which is a risky business not (as the stupid Guardian drunken journo describes it) 'easy money'.

you need a business plan allowing for all insurances, (and you need lots) voids, maintenance, agency fees, legals, etc etc etc etc. You need to make arrangements for gas safe, deposit protection, all the document signing, tenant residency checks and so on. You may even need to register as a landlord - extra cost.

also remember that when you give notice to the tenant, that doesn't mean they leave.

get a shift on as properties bought to let will have an extra 3% stamp duty from April.

[DoctorTwo]

Buying an asset, any asset, whether it's a house, precious metal, or a crypto currency is better than leaving money in the bank. Money in the bank belongs to the bank: an asset you have bought belongs to you.

[specialsubject]

ruining a good story with facts; the FSCS guarantee means the above is not true within the level of the guarantee.

but with interest rates so low the money will be eaten away by inflation in any bank or building society.

[DoctorTwo]

Hahahaha special, tell that to account holders in Cyprus. Also, the rules say that funds up to £85K are covered, so if you have £1Mn in the bank you lose 91.5% of your capital. That's why assets are a better bet, and also why they are appreciating so heavily, except gold, which is being re-hypothecated like fiat money.

From 1.1.16, the EU enacted a law that banks are not to be bailed out by the state. Rather, it will be the deposits of the banks that pay the bankers' debts. So it'll be our money paying for their fraud and theft. Again.

[financialwizard]

Actually as of 1st January 75k per person per institution is covered by the FSCS. So if said person has that £1m in 14 different stand alone UK banks they would indeed be covered by the FSCS and get all their money back.

The fact is though that as interest rates are so low you probably are better going BTL, but as a previous poster says you will probably want to get a wriggle on.