£25K TODAY or £250K in 20 YEARS? | RENTAL PROPERTY INVESTING VS FLIPPING HOUSES
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- Опубликовано: 20 мар 2022
- How do you choose between flipping a property or renting out a property? There are lots of things to consider, including the money benefits! Buy-to-lets are typically a very popular choice but refurbishing a property is quick cash flow.
Let us know what you would choose…
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Nice work Jamie, thank you for the video
Glad you got some value :)
Thanks Jamie! Always pleasure to see you in here…. You have given me lots of motivation and courage. I am in midst of selling my flat in London as keen to start flipping. I already bought a flat in elegant Edinburgh and decided to move to Scotland permanently so all looking up for me as new chapter:). I want to do flips over in Scotland so wish me luck. Will shoot if I need some guidance :). Take good care and enjoy summer - well deserved no doubt! Dee 🏆
Another great video with excellent content! Well done, again! 👍🏼👍🏼👍🏼
Thanks again!
I haven't seen this analysis before, but it resonates with me. Why put in all the work and get rewarded ones.
Yes!
Excellent vid Jamie.
Thanks :)
BTL here as I don't have the time to project manage a flip, plus looking for the income each month.
My first house was a Buy , Renovate , Rent. I couldn't afford a house for me to live in in Warwickshire, so bought in Derbyshire to make money, so then I could afford my house in Warwickshire.
At the time, I didn't know how the finances worked with remortgaging. I was thinking it was a choice of rent out my house (while renting myself) , or sell it, and buy a house for me to live in.
The mortgage advisor said I could do both, so rented the first, and bought a second for me to live in.
Now, the first has been sold, and I'm waiting to start the BRR process again.
Love it Rob
I’m
Having to do a couple of flips to move me into bigger rental properties, just a short term measure with the focus on the long game. Great video!
You can do it!
BTL for me… I did a video comparing the 2 and BTL came out on top 👌 👍 🏠
I'll check it out
Decent video yet again - nice one. How come you only did 1 flip compared to 5 years of BTL's income. Presumably you could have done 2 flips every year rather than stopping at 1 in your example? I think the real answer to the question is what do you need the money for? Short term wealth or long? Isn't that why some say keep every 3rd house you renovate?
Thanks Jamie - great video . Do you consider BRRR the same as BTL i.e Do you refinance after every BTL refurb ??
80% of the time I do
As per usual very great and informative video man really appreciate it!
What is the minimum capital to start with flips without going bankrupt?
And would you recommend doing that in partnership as a friend of mine and I were thinking to start the whole thing together.
It depends on your location and the type of property etc
BTL all the way, it feels slow on first 1s but then the money flys into the bank every month
The time to start is yesterday
Yes!
Great video Jamie, I think it’s worth mentioning another great advantage. The rental income could also be generating interest (say 7%) and benefitting from compounding in an index fund. For this example 53550/20=2677 / 12 = £223 per month. If this was deposited each month in an index with returns of 7% by the end of the 20 years it could actually = £116,116. Vanilla BTL for me too!
Great Video, think I will eventually rent out my flat I live in, is it easy enough to change from residential mortgage to BTL?
Go for it!
But in only calculating the amount per year including rent@7% which isn't guaranteed at today's mortgage rates on a BTL you're pushing your preferred strategy.
ie: if builders do the work how much do you have reinvesting that initial £150000 in ever bigger flips?
BTL you forgot tax and tenants wrecking your property refurbs the court cost of removing tenants and future government regs that defiantly will favour the tenants
Also how increasing rates and a drop in prices will mean you will not be able to refinance and be stuck with a financial liability -especially in an inflationary environment ..
It's only 1% of renters who are an issue
Great Video Jamie, one of my favorites so far, BTL 100%, The numbers over the long term are very good, Time in the market is a key part to BTL🏡🏡🏡 Good luck and have a solid plan💥💥
I agree great video👍🏻😁
Boom!
What do u guys think abt companies that take over ur BTL and guarantee rent for 1 year to 3 years? Pls someone talk abt this, cos I ve two companies line up to take over my property as soon as I move to a new property
I would say- once you have 8-10 BTLs (each averaging 110-170k) in action (working for you), you are fine with any strategy. Anything below- just pain
Surely BTL is getting more difficult. What with tax and EPC ratings plus hassle and headaches with tenants not paying.
A flip seems better and no capital gains tax if your own property?
Im pretty sure you'd pay capital gains if its not your main residence (assuming you make over CG allowance)
Exactly, btl is an easy target for tax man and easy target for forcing potentially expensive upgrades , next it could be rent control where you may be forced to rent it out for a loss once you've paid for all that crap.
But maybe flips will be affected too, homes may have to be up to a certain standard to be allowed to sell.
I think anyone thinking about getting properly right now should be careful, things are not good and prices are stupid high , it's a recipe for disaster imho.
Maybe I need to do another video on what you get taxed on
Summed up my situation perfectly at the end. Im having to do a couple of flips to recycle capital, and i'm planning to hold as a BTL's as & when funds allow. Hopefully phasing out flips ASAP.
Wont be any money in btl in the near future. Everything is getting squeeze already very tighly.
That’s been said for almost a thousand years now. I respect the opinion of course. And investment will take its own shape, but I doubt property as an investment will completely change
yea but how many flips could you do in 20 years with different profit on each flip more than 25k on each.
Jamie, what if you can't get a loan or mortgage because you don't work but you have enough capital to purchase outright?
Speak to a mortgage broker,,,,
Why do you need a mortgage then?
I suppose I don't, but a man of your profession; it's always nice to learn from an experienced person.
Could you set up a LLC and get business loan and use that for down payments on two rental properties with the bank making up the rest? Paying the business loan off asap with profit made from rental income
I've done BTL and couldn't be faffed with the constant attention needed for some tenants. Much prefer to flip. Also BTL rent profits are eaten away by got tax rules.
Everyone likes different things
0:10
Is that a £1/4m? Ill give you 300k for that...🤪🤪🤪
8:53...😁😁😁
Did you take off the finance cost when you calculated the rent roll?
Jamie, how do you refurbish when you're not local to the property?
I'm down south but have been put off with fixer uppers in the north for this reason
Is there a good way of contracting a firm to do it or must it be done by yourself?
Ultimately you have to be there man, no one’s gonna have to care or attention of detail like the man paying for it. Costs can soon run away from you
You need a good project manager
The reality of the situation is that small private landlords are being targeted by the government and will be obsolete in the not-too-distant future.... forget owning a rental for 20 years, it simply won't happen. My advice as a landlord of 10 years is to either flip property and enjoy the money you make NOW.... or stay away from property altogether.
It does feel that way. I kind of agree. In 20 years it will be near impossible to get in. My mindset is different though I want to get in as aggressively as I can now, and hold for as long as possible for when the barriers are so much higher
@@JamieYork Yes that's a very good point. As you're already in you are in a great position to hold on as long as you can. Thanks for all the great content 👍
I'm currently doing a flip house this is my first property and it's being financed by a loan and 0%credit cards due to the state of the property was forced down this route as couldn't get a mortgage on the property . It's so difficult juggling work and getting the money in with trying to renovate the house . This project would be so much easier if had money behind me as could commit full time . Hopefully when this is sold will look at buying another one which from that point on would be a remortgage and renting out . I would like to aim for 1 rental a year and 1flip aswell for the next year's would hopefully set myself up for the future. Great video
BTL everyday!
Yes Stephan!
I’m not sure I’ve understood your comparison? Surly the flip is £500 k profit ?
Ie one flip a year at £25 k profit for 20 years is £500 k, even with no increase in profit subject to inflation? I accept that the flip would be more work each year but your comparison is misleading Jamie ….
I don’t think it’s misleading at all. It’s a comparison of doing ONE property and doing a like for like comparison on the sale act same numbers … with effort in one time
Do one flip at year would not be the same comparison at all.
JAMIE, i bought my first buy to let last yr !! Have done 3 flips prior to that since 2015 but im embarking on my biggest challenge yet. As you know the prices on properties are ridiculous right now with everything going over asking !!
I bought a plot of land with planning for a 900 sq ft, 3 bed house. Currently im waiting for the discharge of conditions to come back from my local council but then i will be making a start on my own new build project.
Essentially im planning to BUILD TO RENT !! Thought once i pay back my investors by refinancing i will hopefully have minimal money left in or even break even whilst creating 25 % equity in a £325 k house. Well so the projections go. Im not a builder by profession btw, im 40 now and the goal is to have a decent portofolio of 10 -15 BTL within 20 yrs max !! Im wont take a passive income till i retire so trying to speed up the process to achieve my main goal.
Future youtube video perhaps pal !! 👍🏼 take care
Love this!
Honestly I'd steer clear of both right now unless you are very well financed and prepared for price drops and rent arrears.
Hard times ahead.
A relaxation of demand potentially, but I really don't believe there will be drastic price drops right now
@@JamieYork its difficult to predict if course, most of the time it all goes up and over the years it will always go up overall.
What I mean is right now competition is so fierce that you need to offer well over asking price to be with a chance of buying properties and u think once demand slows it will be easier to get a decent deal, but as long as you can afford the mortgage even if tenants decide to be a pain and not pay there shouldn't be an issue if you bought now.
I've looked at a few properties to buy and all sold within a day for 50k or so over asking price which was already high, but I have noticed many properties are back on the market at lower asking prices so something's going wrong possibly when being valued by mortgage provider .
@@JamieYork time to speclute right now? Buying a property at even less if asking price? Keep it going for a few years ( meantime rent/ cash flows in) then released some equity? Then sell for a profit?
Great content as always. Food for thought... how many flips could you make within 20 years? ;)
Theoretically a LOT. All depends on if you want to put in the continued effort of course 😊
One thing you’ve not mentioned is that you’ll get taxed on your ROI every month
That all depends on different aspects though
Do you bother with surveyors Jamie or just have your team assess properties?
We do get surveys from time to time
Btl all day
All the way!
As a HRT payer, FLIP through a LTD company is what I believe fits my circumstances.
It very well could be! All the best with it!
Btl
Yes!
Cool, thanks for your lovely reply
You still accepting investors?
Always!
@@JamieYork I'll be in touch soon
BTL everytime for me. It's something I can pass down when I peg it
YES!
I flipped a property 2019 made 10k , same property is now worth 35, 40 k more than I bought it for , doh !
Ouch! Hindsight is a wonderful thing eh!