At this stage, with approx £1700 profit each month (excluding repairs) it makes it easier to save money for another deposit.
Ive seen people talk about the snowball effect and I’m seeing it happening to my portfolio now. with 12 months of £1700 profit per month, I’m now able to save £20K per year, which is almost another deposit for a house, so that is without me adding my own cash to the table. Luckily, I have a full time job to allow all of the property profit to go straight back into the next property.
So here is the next purchase, another 2 bed house.
The rental demand in this area is good. There is a tenant in situ, which is good, but I dont feel like I can increase their rent, so when they move out, I will do some refurbishment and increase rent after.
| Price | £92K |
|---|---|
| Mortgage | £69K@ 3.4% = £195 per month |
| Deposit | £23K |
| Rent | £550 per month (low for the house but will increase later) |
| Management | 9%+VAT = £59.40 |
| Insurance | £13 per month |
| Cashflow | £550 – £59.40 (management) – £195 (mortgage) – £13 (insurance) = + £282 per month |
| Return on Cash | 3384 / 23,000 = 14.7% |
This apartment is in a good area, so hopefully demand will be high.
Here is the updated summary
| Type | Deposit | Rent | ROI | Cashflow | |
|---|---|---|---|---|---|
| Property 1 | 2 bed semi | £26,250 | £595 | 13.6% | + £298 |
| Property 2 | 3 bed detatched | £31,250 | £650 | 8.54% | + £305 |
| Property 3 | 2 bed semi | £22,500 | £525 | 16.5% | + £309 |
| Property 4 | 2 bed semi | £24,000 | £595 | 15.7% | + £314 |
| Property 5 | 2 bed terraced | £6,250 | £450 | 49% | + £257 |
| Property 6 | 2 bed apartment | £18,000 | £550 | 14.9% | + £224 |
| Property 7 | 2 bed house | £23,000 | £550 | 14.7% | + £282 |
| Total | £151,250 | + £1989 pcm |
I will keep an eye out for any more like this, as the price is good, and the return is OK. Its not amazing, but a good solid buy.
Property Seeds 