UK Investment Mortgage
UK Investment Mortgage | A Viable Alternative To A Pension Fund?
A UK investment mortgage offers hope to thousands of people who are facing the news that their pensions may not stretch as far as they had hoped. What is more, the younger people face the prospect of having to work till 67 or more, with not much financial reward at the end of it. With this in mind, the government is urging people to take other steps to secure their retirement and one way of doing this is through a UK investment mortgage.
Getting an investment mortgage is relatively simple as there are now dozens of lenders and BTL mortgage deals around. Finding the right investment mortgage can be as simple as talking to a specialist broker or having a look online. There is quite a lot of choice, so it might be worth getting some help to get the right investment mortgage.
A UK investment mortgage offers two income possibilities for future retirees. On the one hand an investment mortgage offers the possibility of short term supplementary income from the money received from the rental of a property. In order to make the most of a BTL mortgage, people looking to supplement their income need to make sure that the property is vacant for as short a time as possible. The higher the occupancy level, the better the rental income to pay the UK investment mortgage. One way of improving the chances of continuous letting and reducing the number of void periods is to use a letting agent for the property.
The income from a property on which there is a UK investment mortgage also needs to be sufficient to make the mortgage payments. In an ideal world, with a UK investment mortgage, a new landlord will also be able to fund any refurbishments that are necessary for the property. If the landlord's calculations are correct, there may even be enough left over to make a tidy little addition to the monthly budget.
Long Term BTL Investment
However, a UK investment mortgage is also for the long term and it may follow the same pattern as other investments. Just as shares may depreciate in value one day and appreciate in value the next, landlords with a UK investment mortgage should expect similar fluctuations in property prices. In the 1990s many people woke up one day to find that their previously valuable properties had lost a lot of their value and were hard to sell. That can happen if there is a property crash. However, many of those properties have now recovered and even exceeded the value they had then, so those who were in it for the long haul have seen some return on their investment.
A UK investment mortgage, therefore, should not be seen as a short term income fix but as a long term investment. The Association of Residential Letting Agents (ARLA Jan. 08) estimates that many landlords keep a property for just over 16 years, which is plenty of time to get a good return on a UK investment mortgage.
