|By TurnKey Landlords||
|June 1, 2014 05:00 PM EDT||
If you are reading this, then in all likelihood, you’re a landlord. It shouldn’t entail a massive leap of imagination to picture a tenant paying you to live in your property, seeing as this is what the investment is all about. What might be a bit harder to imagine is taking that money and using it to pay rent… to your own landlord. This, ladies and gentlemen, is the ‘let to let’ phenomenon.
Do you mean that property sub-letting strategy?
What, rent to rent? The latest get-rich-quick scheme to do the rounds, rent to rent entails renting a property from a usually distressed landlord, doing the place up and sub-letting it for a profit. The legal set up can be a bit of a nightmare and the many claims that it can create a large ‘passive’ income are often treated with more than a little suspicion. (And then there’s the fact that, in October 2013, one of its biggest names nicked off with £60,000 worth of tenants’ deposits!)
No, I’m talking about let to let (sometimes referred to as ‘rent to let’, which might be where the confusion arises) that entails being the landlord of a buy to let property that you own, whilst simultaneously paying rent to live in a property that you don’t.
On the face of it, it seems counter-intuitive. To an investor, ‘dead money’ is a nightmare, and ‘paying someone else’s mortgage’ (the oft-held pejorative view of renting) is about as dead as money can get. But for some landlords, particularly younger investors who haven’t yet found their ideal home, or whose careers are still mobile, it’s the perfect setup.
A foot in the door
For renters, owning a rental property of their own can be a good way to get on the property ladder without having to sacrifice living standards or choice of location. A lot of let to let-ers live in fairly expensive areas, and would find it difficult to finance a starter home in the same area without downsizing. Their budgets might not allow for a deposit on a comparable place, but might just cover a buy to let property in a less expensive area.
Furthermore, with our cultural emphasis on homeownership and constant reports of the difficulties faced by first time buyers, it can be easy to forget than some folks simply prefer the renting lifestyle. Moving every six to twelve months can be rotten, but the flipside is the freedom that renting affords. Some people might be making big changes – like moving in with a partner, for instance – and want to ‘test the water’ before committing. Others enjoy being able to relocate at short notice without the hassle and stress of a property chain.
Suitable buy to let products for let to let
The strength of the buy to let mortgage market has improved the range and flexibility of products on offer, and there are now a fair few let to let mortgage options available.
As with any buy to let mortgage, your lender will require the rental income to cover the mortgage interest repayments by a certain amount, usually 120–130%. In addition, the most favourable interest rates and product features can be found at LTVs of 60% or lower, meaning that you’ll need at least a 40% deposit to put down.
Bear in mind that a number of buy to let mortgage lenders require that you already own your own home, meaning that your options as a renter are more limited than that of other investors. There’s also the impending Mortgage Market Review to consider – with the tightening of criteria in the residential mortgage market, it’s feasible that more people will attempt to fraudulently obtain buy to let finance in order to get a mortgage. To stop this, more lenders might start closing their doors to those without a residential property in the future.
Let to let property management
Managing a single let to let property is really no different to managing a single buy to let property – the only difference is that you’re more likely to have to up sticks at some point, and this could present a problem if you rely on being in close proximity to your tenants.
Otherwise, the choices are much the same. Do I self-manage, or do I use an agent? Do I invest for income, capital growth, or something in between? What sort of tenants do I want? How involved do I want to be in the day-to-day running of the property?
If you are completely new to the landlord lark, a good place to start is our step by step guide to becoming a landlord.
Some other bits and bobs that you might find interesting:
- Capital growth vs. income
- Self-managing your buy to let property
- Choosing a letting agent
And of course, for the all-important matter of financing your let to let property, call us on the number above or request a quote to see how we can help you to find the most suitable buy to let mortgage.
With all the incredible momentum behind the Internet of Things (IoT) industry, it is easy to forget that not a single CEO wakes up and wonders if “my IoT is broken.” What they wonder is if they are making the right decisions to do all they can to increase revenue, decrease costs, and improve customer experience – effectively the same challenges they have always had in growing their business. The exciting thing about the IoT industry is now these decisions can be better, faster, and smarter. Now ...
Jan. 18, 2017 01:30 AM EST Reads: 4,190
WebRTC is about the data channel as much as about video and audio conferencing. However, basically all commercial WebRTC applications have been built with a focus on audio and video. The handling of “data” has been limited to text chat and file download – all other data sharing seems to end with screensharing. What is holding back a more intensive use of peer-to-peer data? In her session at @ThingsExpo, Dr Silvia Pfeiffer, WebRTC Applications Team Lead at National ICT Australia, looked at differ...
Jan. 18, 2017 01:15 AM EST Reads: 4,858
"Splunk basically takes machine data and we make it usable, valuable and accessible for everyone. The way that plays in DevOps is - we need to make data-driven decisions to delivering applications," explained Andi Mann, Chief Technology Advocate at Splunk and @DevOpsSummit Conference Chair, in this SYS-CON.tv interview at @DevOpsSummit at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Jan. 18, 2017 01:00 AM EST Reads: 2,003
The cloud market growth today is largely in public clouds. While there is a lot of spend in IT departments in virtualization, these aren’t yet translating into a true “cloud” experience within the enterprise. What is stopping the growth of the “private cloud” market? In his general session at 18th Cloud Expo, Nara Rajagopalan, CEO of Accelerite, explored the challenges in deploying, managing, and getting adoption for a private cloud within an enterprise. What are the key differences between wh...
Jan. 18, 2017 01:00 AM EST Reads: 6,041
"Logz.io is a log analytics platform. We offer the ELK stack, which is the most common log analytics platform in the world. We offer it as a cloud service," explained Tomer Levy, co-founder and CEO of Logz.io, in this SYS-CON.tv interview at DevOps Summit, held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA.
Jan. 18, 2017 12:45 AM EST Reads: 6,238
Adding public cloud resources to an existing application can be a daunting process. The tools that you currently use to manage the software and hardware outside the cloud aren’t always the best tools to efficiently grow into the cloud. All of the major configuration management tools have cloud orchestration plugins that can be leveraged, but there are also cloud-native tools that can dramatically improve the efficiency of managing your application lifecycle. In his session at 18th Cloud Expo, ...
Jan. 18, 2017 12:45 AM EST Reads: 5,938
In his session at @DevOpsSummit at 19th Cloud Expo, Robert Doyle, lead architect at eCube Systems, will examine the issues and need for an agile infrastructure and show the advantages of capturing developer knowledge in an exportable file for migration into production. He will introduce the use of NXTmonitor, a next-generation DevOps tool that captures application environments, dependencies and start/stop procedures in a portable configuration file with an easy-to-use GUI. In addition to captur...
Jan. 18, 2017 12:30 AM EST Reads: 2,774
Due of the rise of Hadoop, many enterprises are now deploying their first small clusters of 10 to 20 servers. At this small scale, the complexity of operating the cluster looks and feels like general data center servers. It is not until the clusters scale, as they inevitably do, when the pain caused by the exponential complexity becomes apparent. We've seen this problem occur time and time again. In his session at Big Data Expo, Greg Bruno, Vice President of Engineering and co-founder of StackIQ...
Jan. 18, 2017 12:00 AM EST Reads: 7,728
"ReadyTalk is an audio and web video conferencing provider. We've really come to embrace WebRTC as the platform for our future of technology," explained Dan Cunningham, CTO of ReadyTalk, in this SYS-CON.tv interview at WebRTC Summit at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Jan. 18, 2017 12:00 AM EST Reads: 2,253
One of the hottest areas in cloud right now is DRaaS and related offerings. In his session at 16th Cloud Expo, Dale Levesque, Disaster Recovery Product Manager with Windstream's Cloud and Data Center Marketing team, will discuss the benefits of the cloud model, which far outweigh the traditional approach, and how enterprises need to ensure that their needs are properly being met.
Jan. 17, 2017 11:30 PM EST Reads: 4,310
Containers have changed the mind of IT in DevOps. They enable developers to work with dev, test, stage and production environments identically. Containers provide the right abstraction for microservices and many cloud platforms have integrated them into deployment pipelines. DevOps and Containers together help companies to achieve their business goals faster and more effectively. In his session at DevOps Summit, Ruslan Synytsky, CEO and Co-founder of Jelastic, reviewed the current landscape of D...
Jan. 17, 2017 11:15 PM EST Reads: 4,887
In 2014, Amazon announced a new form of compute called Lambda. We didn't know it at the time, but this represented a fundamental shift in what we expect from cloud computing. Now, all of the major cloud computing vendors want to take part in this disruptive technology. In his session at 20th Cloud Expo, John Jelinek IV, a web developer at Linux Academy, will discuss why major players like AWS, Microsoft Azure, IBM Bluemix, and Google Cloud Platform are all trying to sidestep VMs and containers...
Jan. 17, 2017 11:00 PM EST Reads: 534
The many IoT deployments around the world are busy integrating smart devices and sensors into their enterprise IT infrastructures. Yet all of this technology – and there are an amazing number of choices – is of no use without the software to gather, communicate, and analyze the new data flows. Without software, there is no IT. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, Dave McCarthy, Director of Products at Bsquare Corporation; Alan Williamson, Principal ...
Jan. 17, 2017 10:30 PM EST Reads: 2,341
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
Jan. 17, 2017 10:30 PM EST Reads: 696
DevOps and microservices are permeating software engineering teams broadly, whether these teams are in pure software shops but happen to run a business, such Uber and Airbnb, or in companies that rely heavily on software to run more traditional business, such as financial firms or high-end manufacturers. Microservices and DevOps have created software development and therefore business speed and agility benefits, but they have also created problems; specifically, they have created software securi...
Jan. 17, 2017 09:30 PM EST Reads: 1,771