Was talking to a friend of mine who owns a place in the midlands that he lets out. He told me that he was getting £650 a month for it........but only sees £575 after the agents fees. I guess when looking at the foolishness of some BTL "investments" taking the headline letting income is not sufficient and the likely returns are somewhat less than this.

Oh and buy the way his mortgage payments are £750 a month! But he's had it valued recently and the price is going up so it's OK.

Wtf is the point?

The rent doesn't even cover the cost of the mortgage.

It's just madness.

Is that an interest only mortgage ?

So effectively he's renting it so he can rent it to someone else in the hope of capital gains, which wont happen !!!!

Maybe he's in it for the long term...drops.

Other costs...ground rent, insurance, dead periods, up-keep, gas checks. Take abothe 100 quid a month off that return.

Now factor in capital loss over the next 10 years and it's not looking good.

You wouldn't BTL now. But a few years ago you might have. If you're in the your thirties and have some money - gamble on capital gains over the next 30 years, then sell and retire. I've been putting my money into a pension, but I'm paying my pension company fees, just like your mate is paying his agent's fees. And I'm gambling on gains over the next 30 years. But hey, the stock market is currently going DOWN! And I would imagine a fair portion of my pension has been invested in property - so that's money I won't see again. So what's the difference? Tax relief is all I can think of. Without tax relief, I'd probably try and smoke and drink my way to an early grave instead.

Dude, shut-up are you trying to talk us into a recession?

"renting is dead money" oh the irony of that phrase!

This is another case of "it's my pension". Unfortunately the EA's are saying the price is going up. They have also MEW'd it to get the deposit on the place they now live in - Which is also still "going up in value".

In terms of pensions I realy can't understand why anyone especially a higher rate tax payer wouldn't have a pension as you are effectively getting 20-40% of free money.

Ill at ease with having money tied up in something the chancellor can steal at will... Although I suspect that covers absolutely everything.

And the fear you'll not get to 55 to get your mitts on it.

And then his alarm clock went off

I looked at renting a flat last week the lettings agent wanted £120! upfront non refundable (£60 x2 for me and the Mrs) for the priviledge of a credit check and work ref's so seeings we have professional jobs a few quid in the bank we politely didn't get back to them on the flat, which incidentally was very nice but is also now empty AND up for sale.

I believe credit checks cost less than a fiver from somebody like experian?

£2 last time l checked. Always a bit odd writing a cheque for such a small amount.

Private/personal pension, or company pension with employer contributing? If company, final salary or 'money purchase'?

A 'pension' isn't automatically a good thing. It depends what the commission or charges are, who's investing it, in what, and whether your firm is genuinely long-term solvent. Need more detail to comment.

By far the best way to save in an uncertain world is still under the matress in my opinion :-) The French have the market cornered for saving for a rainy day longterm out of the banking system. Just make sure you have a state of the art burgular alarm and a couple of BIG dogs and you will be fine, longterm and a lot less risk. Its also more fun counting it out, note by note, who needs a so far, useless, HD TV to have a good time at home!