David Marr bought his first property seven years ago - a flat on West Mayfield, South Edinburgh, for £110,000. He lives in this property and it is now worth around £210,000.
Taxi driver David, 52, then purchased his first investment property two years ago. He paid £150,000 for a flat located on Edinburgh’s Grantully Place.
It is now valued at around £200,000.
He later inherited a property on Thistle Street, which his father bought 25 years ago for approximately £8,500. The flat is now worth around £190,000 and is mortgage-free.
Six months ago, David added a fourth property to his portfolio, by purchasing a seven-year-old, two-bedroom flat in Nether Liberton Gate, south Edinburgh, for £160,000.
He says: “Nether Liberton Gate is a sought-after location, close to the local university, new Royal Infirmary and shopping centre. I was more than happy with the price I paid for the property. We got it at a knockdown price at the time due to the vendor’s circumstances. There is an added bonus in that there is scope to add a third bedroom.”
Easy money
David explains that he had no problem securing a mortgage for this property. He paid a cash deposit of £16,000 (10% of the property price).
“I took out 20-year mortgage from Birmingham Midshires at a fixed rate of 6.5%,” says David. “I am currently receiving a monthly rental income of £640 and am paying £610 each month on my mortgage. I opted to repay the interest-only at this stage, because this was most affordable in the short term. In addition, I paid £2,797 in legal and surveyor costs, which included the 1% stamp duty.”
David recently had the property valued and was told the flat is now worth £180,000. That’s a whopping £20,000 profit in just six-months.
He is currently receiving a combined rental income of £1,840 per month. His property portfolio is now worth £780,000, of which only two properties are financed through borrowed money, with an outstanding debt of £277,000.
“I don’t have any particular investment strategy,” he explains. “However, I do feel that my money is better invested in property, as opposed to banks, the stock market, or any other form of investment. I therefore hope to buy two more properties in south Edinburgh and then I will call it a day.”
He continues: “I buy properties in Scotland because I live there and I like to feel close to my investments. Furthermore, property prices in Edinburgh are still very buoyant due to a shortage of properties, which makes for a good rental market.”
David has this advice for any aspiring property investors: “I feel that we have been selective in the areas we have bought in and the type of tenants that we rent to. Everything, in terms of the lease and all the legalities are followed to the letter.
“So I would encourage anyone to invest in residential property. We have watched our investments grow in a way that is more lucrative compared to any other form of investment. Go for it!”
Interview by Marc Da-Silva