On 06/08/2012 10:24, tim..... wrote:

My own experience of doing this when returns on a "normal" property were
12% is that, without the capital gain, it was more hassle than it was
worth. Tenants not paying their rent, moving out before the end of term
[1], leaving the place as a tip [1], making request for "unreasonable"
improvements. Yes, you can employ an agent, but that will cost you 15%
and they can't insulate you from every problem and sometimes create
problems of their own.

At 4% return, I wouldn't touch it again with someone else's barge pole.

Though, even in the current market, there are properties/locations that
return 12%.

Are you expecting a capital gain here? If you are, would you consider
investing in a property and keeping it empty was a good investment?

YMMV

tim

[1] Having "spent" the deposit on the final month's rent that they
didn't pay.


I entirely agree with this. One of the biggest 'costs' is void periods
between tenancies. According to ARLA, the average is about 5 weeks a
year, which is another 10% of your rent whittled away.