I need a plan to suit my naval lifestyle, but as a first-time buyer this may not be easy
Q I am 21 years old and serving in the Royal Navy. Recently, I have begun thinking about what to do with my money and making decisions that will benefit me in the future. I have no outgoings and very few savings, which I am planning to turn around as I’m currently on deployment. Therefore, by the time I return home I should have saved a fair sum of money.
I would like to start thinking about buying a property to let as I have no need of accommodation, due to it being supplied by the job and my living with my mother when I’m not on the ship. I would like to know what a suitable plan of attack would be for me, in terms of getting a mortgage and finding a property. Would it be better for me to wait and get some real money saved?
I imagine it isn’t as easy as it sounds, acquiring a property to let as a first-time buyer, but it wouldn’t make much sense for me to be paying for somewhere I am only likely to live in a couple of weeks of the year. SS
A A friend of mine who was in the RAF, and so lived on bases most of the time, wasn’t much older than you when he bought a property to let out rather than live in. He too was a first-time buyer so what you are thinking of doing is perfectly possible and quite common practice for people – not just those in the forces – who get a home as part of their job.
As you have no experience of buying or letting property, I suggest you start by looking at the buy-to-let information from the Association of Residential Letting Agents (ARLA). It would also be a good idea to talk to an ARLA member for detailed advice on which areas and types of property are popular, and so likely to be easy to let. You should also determine whether it is better to let the property furnished or unfurnished. As you are not buying a home to live in, you need to choose a property from a business standpoint rather than picking one you like the look of.
As far as getting a mortgage goes, you are likely to need to put down a cash deposit of at least 25% of the value of the property you propose to buy. You will also have to show that the rental income will cover your monthly mortgage repayments by 125%. So if, for example, your monthly mortgage payments were £1,000, you would need to charge a market rent of £1,250.
The other thing to think about is whether you will manage the letting yourself or whether you will pay a professional lettings agent to manage it for you. Given that you are away on ship for a lot of the time, using a lettings agent would seem to be the more sensible option and more convenient for your prospective tenants.
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