BTL and for future income

[Lm1981]

My wife and have a mortgage on are current home (planned forever home) that’s manageable. We also have approx 100k in savings. Both of us are early 40s and thinking of investing in a BTL - we would be looking at properties in the 200k mark. Is it a case of putting 25% (50k) down and then renting it out?

In theory, yes. In practice? It's a bit nore complicated and you need to do your sums very carefully to make sure it's worth it.

That would be pretty much the minimum deposit for a BTL mortgage. You have all the usual buying costs, plus additional stamp.duty for it being a second home. BTL mortgage rates are generally higher than domestic ones. You have to factor in the costs of safety checks etc. And buy somewhere that meets the EPC rental regulations that are coming in shortly (they may well increase, so you'd want sowmwhere above the minimum really). You can no longer claim tax relief on a lot of the costs that used to be offsettable. Will you manage it yourself or pay agent's fees? Landlord's insurance is going up in price, especially if you want to cover loss of rent. Eviction is harder than it used to be, if you get a bad tenant.

It is possible to make BTL pay, but it's not easy with just 1 property. A lot of small investors are getting out.