Having recently become a father I was, rather prematurely you may think, considering my Sons future regarding a property.
I'm assuming in 17 years time property prices on this little island are going to be no less expensive than now. As I dont relish the idea of downsizing to give the little terror a deposit how do you think this idea stacks up?
When he goes to university; in is first year he gets to know the areas property, then in year two we/he buys the cheapest suitable property and becomes a resident student/landlord.
So my question is;
Could this be financed on a 100% BTL, with me acting as a guarantor. Do BTL's always require a deposit. Would the return pay a mortgage?
You are saying your kid is a baby and you are already planning on the basis that he will want to (a) go to University and (b) be a landlord (at all, ever, let alone saddled with it at age 18).
Really, has the UK obsession with property ownership *really* gone this far? Tell me this is a wind up .
If you want a second property, I would do it on your terms - rather than live it through your child.
Originally posted by DIY or Die: Having recently become a father I was, rather prematurely you may think, considering my Sons future regarding a property.
I'm assuming in 17 years time property prices on this little island are going to be no less expensive than now. As I dont relish the idea of downsizing to give the little terror a deposit how do you think this idea stacks up?
When he goes to university; in is first year he gets to know the areas property, then in year two we/he buys the cheapest suitable property and becomes a resident student/landlord.
So my question is;
Could this be financed on a 100% BTL, with me acting as a guarantor. Do BTL's always require a deposit. Would the return pay a mortgage?
Get a life man, the only thing you need to worry about when your son gets older is that he doesn't fall into bad ways and that he's bought up in a good way.
Stop obsessing about property like (so it seems) everybody else - enjoy your sons growing up and don't worry about the future TOO much.
Sorry for sounding harsh but you don't know what will be happening in this country in 17 yrs time, have fun.
It's dissapointng when people feel the need to pass crass ang glib comments on the forum.
vbland; before you attack people at least read the post correctly. Where did I say "I" want a second property, I didn't.
It's a shame that you think considering various avenues of your childs future is an obsession gone too far. In your world what aspects of my Sons future may I consider and when?
pottymouth; great name that, Hey I'm not worring about the future, why do you equate considering the future with worry? Perhaps that says more about you than me. Again why do you say considering the future is obsessing?
I co-bought my fist property while at Poly and it turned out to be an excellent decision which has underpinned my whole future, hence my personal bias to such a move.
Oh yes vbland, If your happy with your children not going to University thats fine by me. My Son's going to need someone to empty his dustbins.
Originally posted by DIY or Die: Could this be financed on a 100% BTL, with me acting as a guarantor. Do BTL's always require a deposit. Would the return pay a mortgage?
There's absolutely no point in asking this question now, as you've no idea what the banking markets will be like in 17 years. I agree with others that you should enjoy your child as he grows up, and maybe just start saving for him. Maybe he won't want to go to uni, so it'd be nice not to bring him up with set ideals of what he must achieve, and when. Don't think your dig about bin men is too clever either.
Originally posted by DIY or Die: Oh yes vbland, If your happy with your children not going to University thats fine by me.
Well, Uni/Poly education has moved on a bit since our day .
50% of the population are graduates now. Result is that it's not actually passport to a great future for a lot. Refuse collector might be as good for those that end up in drudge call centre jobs, say .
You guys, the original poster has asked for advice broadly, on property, not on how to bring his child up. It is rather offensive of all of you to attack him and pass judgement. I wish my father had thought of this when I was younger... your comments smack of sour grapes and arrogance.
At the end of the day, who knows what lives our children will lead one day, but one things for sure, they've all got to live somewhere, preferably a house/flat.
I have worked hard and sacrificed to build up my portfolio, but my original motivation on my first 3 purchases, was to buy houses for all of my kids, all aged under 9. That's not to say they'll have the same house given to them when theyre older, we'll buy and sell a few and maybe move overseas, but they'll have the headstart in life that I didn't and what's wrong with that... what's wrong with thinking and planning.
Originally posted by captainpugwash: You guys, the original poster has asked for advice broadly, on property, not on how to bring his child up. It is rather offensive of all of you to attack him and pass judgement. I wish my father had thought of this when I was younger... your comments smack of sour grapes and arrogance.
Okay, but what's the point in asking about what BTL mortgages will be available in 17 years time? Seems a bit daft to me.
Obviously I was not expecting a member to tell me the financial conditions in 17 years time. I'm not asking what BTL mortages will be in available then.
But I think we can assume certain broard conditions barring major war or revolution.
Intrest rates will be between 0 -20%. Employment will be between 85 - 98% Demand for property will be strong There will be more students than today We may be in reccession, we may not.
Are you lot saying one cannont consider the financial future because we can't predict that future with any certainty?
If you dont have the knowledge or experience to speculate an informed financial opinion fine, don't reply. When I need tips on parenting I'll post to the relavent forum.
There are very few ways of losing on the property market over an 18 year period, unfortunately a 100% BTL is one of them. Unless you have a fairly large deposit to see you through the rough times, your money may well be spent wiser elsewhere.
Well done for looking out for you son but 100% BTL will only add to your worries, A friend of mines Granddad put £4k into a high interest account for him when he was born, when he turned 18 it had matured into £35k. He withdrew the money and bought a house next to Leeds Uni, which he was attending Good Luck
Good idea to think ahead. I did the same for my son 3yrs ago. I think you have to be 21yrs to get a BTL mortgage and its complicated as your rent needs to be around 125% of your mortgage payment which would be hard to achieve if one room was being taken up by your son and you usually need 15% deposit for a BTL also I’m not sure if the landlord can actually live in the property if he has a BTL mortgage. My son got a normal guarantor mortgage at 18yrs. You would need a deposit though, so start saving for your son now. As a student your son would not need to pay council tax which is a big plus, or tax on the rent as long as the rent was less than his mortgage payments, also it is easy to get other students to share especially if you are close to the university although property in these areas will be more expensive and harder to come by as many parents will be doing exactly the same as you and the student market is easy letting for landlords. As for the return paying the mortgage that obviously depends on the price you have to pay for the property, the number of free rooms you have available to rent out, and the amount of your deposit. The more rooms you have the easier it is to cover the mortgage, however, if you have more than 2 people sharing with your son as resident landlord you will need an HMO license [House of Multiple Occupancy] the requirements for this and costs are set by each local council [£550 per year in my area-ouch] and it is costly to make the alterations to comply eg. fire doors on each room, hard wired smoke detectors in each room, minimum floor space per occupant ,the list goes on and on but in 17yrs time who knows what other regulation there will be so best check this out at the time before you buy. Your son would also need BTL insurance for the property. We went for a two bed flat [cheaper than a 3 bed], knocked down 4 central cupboards and created an internal kitchen in the space and changed the existing kitchen into a good sized 3rd bedroom, which immediately increased the value of the flat and gave my son 2 rooms to let which only leaves £60 short on the mortgage each month. You could also consider a 2 bed with good size lounge and kitchen [with window] and make the lounge a lounge/ kitchen and make the kitchen the 3rd bedroom. I too bought a flat when I was young and it was the best thing I ever did. But think even further ahead - if you have more children - can you afford to do the same for them. We are in the process of renovating a flat for our second son at the moment as he has now started university [also changing a 2 bed to a 3 bed to maximize profit] and three years on it has cost considerably more to buy than the first one and it is a struggle to afford it but it has to be done to give both children the same benefit. We have enjoyed watching the property market, viewing all the flats, planning , alterations, shopping and the sense of achievement at the end. When the time comes if you can afford it - go for it, but choose wisely [the cheapest is usually not the best investment] and do your research first. Now is the time to start saving, it may seem a lot of money but you have 17yrs, you can do it. Good luck. Sorry this is a bit long winded but I hope it is informative.
Ok, as someone living with a student landlord id say this. He is meant to be our 'caretaker' but this means nothing gets done. His parents seem to think basic DIY is enough but it is quite a pressure on him. Our kitchen light has broken and he won't fix it until after his exams, which is fair enough but difficult too.
Being a student landlord is getting more difficult with the HMOs trying to combat the slums a lot of people think they can put us in. Also, you won't be able to get cheap property in student areas - my partner and i love our area but have been completely priced out of the market by big letting companies who charge us a lot, think it is acceptable that our posessions grow mould from the damp knowing we have no other choice as we aren't allowed to rent council properties and can't afford to buy.
Also, it can be difficult living with a student landlord. None of us want to remain in the house with him next year, he's a good guy but it feels like his place rather than ours.
As to an earlier comment that more students will go through uni in 17 years time i don't think that is the case. 50% of my peers statistically will only get jobs of unskilled labour paying minimum wage. There are too many graduates and only top graduates can hope for a good job. Now at the end of my degree with £10,000 debt and no job as of yet despite being a straight A student I have many regrets over this degree business.
It is nice that you are so concerned for your son's future but really too much will change between now and then. I would recommend opening a high interest savings account and putting in £10 a week, by the time he is 18 that will be £9,000 plus interest. Let him decide then how best to manage it.
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