Buy to let?

[ROO1]

Hi, thinking of renting out the house we currently live in (we have 50% equity) and buying another. Anyone else done this? If so what are the real life pros and cons. Thanks in advance

[JC]

someone like me renting it out 

[DubFan]

You'll have to change your mortgage for the property that you want to rent out and then get another mortgage for the new place. But I would imagine that you may not be able to get a Buy-to-let mortgage for a shared-ownership property.
You may not be able to rent out a property if you don't own it 100%, but that will depend on your shared equity deal.
A lot of shared ownership deals have limits on things like modifications, selling, etc.

You'll also have to make sure you can afford to have the house empty and pay 2 mortgages if you don't find a tenant straight away.

The big problem I have personally with buy to let, is that a lot of people getting into the buy to let market buy up the cheaper properties pushing up the prices making it tricky for people to get onto the property ladder.
If the only way you could get onto the property ladder yourself was by using a shared equity deal, do you really think it's right to a) take up a property that was bought as shared ownership and b) take a cheaper property off the market stopping someone else who's trying to get onto the property ladder buying it (imagine that was you a couple of years ago?)
(^This is my personal opinion as someone at the bottom of the ladder, not intending to offend)

A better use for your money would be to buy out another 25% of your current place so that you "own" 75% of it. Then in another couple of years get the last 25% so you "own" all of it.
Or if you can afford the bigger mortgage, sell your current place, use the money from that as deposit on a bigger place and get yourself a mortgage for the full amount.

[ROO1]

...

[ROO1]

You'll have to change your mortgage for the property that you want to rent out and then get another mortgage for the new place. But I would imagine that you may not be able to get a Buy-to-let mortgage for a shared-ownership property.
You may not be able to rent out a property if you don't own it 100%, but that will depend on your shared equity deal.
A lot of shared ownership deals have limits on things like modifications, selling, etc.

You'll also have to make sure you can afford to have the house empty and pay 2 mortgages if you don't find a tenant straight away.

The big problem I have personally with buy to let, is that a lot of people getting into the buy to let market buy up the cheaper properties pushing up the prices making it tricky for people to get onto the property ladder.
If the only way you could get onto the property ladder yourself was by using a shared equity deal, do you really think it's right to a) take up a property that was bought as shared ownership and b) take a cheaper property off the market stopping someone else who's trying to get onto the property ladder buying it (imagine that was you a couple of years ago?)
(^This is my personal opinion as someone at the bottom of the ladder, not intending to offend)

A better use for your money would be to buy out another 25% of your current place so that you "own" 75% of it. Then in another couple of years get the last 25% so you "own" all of it.
Or if you can afford the bigger mortgage, sell your current place, use the money from that as deposit on a bigger place and get yourself a mortgage for the full amount.

You have misunderstood....
Sorry I meant we only have half of the value of our house left to pay,  So large equity

160k house with only an 80k mortgage

[simonpolly]

Are you doing it so you can move to a bigger house or just as a investment ?

[ROO1]

Are you doing it so you can move to a bigger house or just as a investment ?

House sale has fallen through twice in last few months due to proximity of the river and we want to move. Not that the house has ever flooded, the media hype has got solicitors twitching

[simonpolly]

Tricky one that you in a new build on a flood plane then ? Bridgnorth at a guess

[VW BUSH]

Do it above board and through a good letting agent, as its not your main income you need to protect your asset and avoid hassle.
Be selective of tenant credentials, don't allow dss.
Get insurance and mortgage for letting, don't be tempted to avoid this...
Put funds by for repairs, more things than you expect will go wrong.
Make sure you can afford both if the interest rates rise.

[ROO1]

Tricky one that you in a new build on a flood plane then ? Bridgnorth at a guess

Yes Bridgnorth but further down the river and 350 metres away from it. Most properties are on its banks and sell easily even though they flood every year. Ours has never ever flooded. Not on a flood plane.