To think buy to let sounds almost fool proof?

[ProverbialOuthouse]

I accept I might be being naive here but I can't see how buy to let isn't a bit of a money spinner?

I want to buy a second property instead of paying for a pension.

I've found a one bedroomed flat for £45k (I live in a cheap area of the country).

If I put £10k down on it the mortgage would be £35k and would work out at £200 a month. Rental value is £300 a month.

So as far as I can see you're getting the mortgage paid each month plus an extra £100 a month which could be put away for repairs, insurance etc.

In two years you would have nearly £5k paid off the mortgage leaving you with £30k left to pay. So you've basically made £5k in two years. Hold onto it for another two years and you have £10. If you sold it at this point for what you paid for it you get your £10k deposit back plus the £10 that has been paid on the mortgage.

I know it's not massive money but it's still a profit?

What am I missing other than the fact that you could end up with arsehole tenants that don't pay their rent?

I love these threads. You get half the LLs crying poverty and the others boasting saying they're raking it in. I wonder which are the ones with happy customers.

I love these threads too, they're always a fun combo of false dichotomy (profit making ll must equal exploited tenant) and just plain old sour grapes.

I think what accounts for opinions at opposite ends of the spectrum is that the concept of a foolproof money spinner is different to different people. If you get your figures right and invest well your property will tick over/pay for itself, but I'd consider that more of a long-term investment than a money spinner.

Mind you, being a slumlord has always been very profitable, if you have the stomach for it.

A few years ago I became a landlord not by choice - my mum passed away and was renting out her house. It was an absolute nightmare and we had good stable tenants, and I moved in myself when they moved out.

Rent for the house was £1350 a month. After paying the letting management fee, boiler and central heating cover, cover for the appliances in the house, building insurance, and the sky and broadband that my mum stupidly included in the rent, there was about £900 a month left which would originally have barely covered her mortgage (paid off by life insurance). Despite having a lettings co involved, I spent SO much time trying to sort things out - the washing machine broke and it turned into a four month saga trying to get the company I paid to insure it round to come and fix it (letting agent would apparently spend hours on the phone trying to get through and basically washed their hands of it, tenants couldn't be home as they were nurses, appointments missed etc etc), and that's not accounting for things like leaks, other problems, etc etc. It was a constant issue. For periods in between tenants it was a struggle for my mum to cover the mortgage and she was lucky that she never had tenants that trashed the place, skipped rent, refused to leave...

It was only a few months but I'd never do it again. If you have bad tenants you can be financially ruined. Too many people think it's easy money.