I have about £300,000 to invest. I’ve been considering buying a buy-to-let property to help fund early retirement. Given that I can get a 4.5 per cent return on interest from the bank and the property market remains stagnant (although the rental market in Essex is booming), is an investment in a rental property worth the hassle?
Richard, Colchester
If your only goal is to generate income so you can cut back on work, probably not. At least, not without using leverage.
Take one of our recent purchases as an example. Bought with cash, it would return 2 per cent after all anticipated costs: significantly worse than the return on cash in the bank. Using a 75 per cent mortgage (even at today’s rates), the
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