Facelift for buy-to-let profit calculator

Our excellent and completely free buy-to-let profit calculator has had a facelift. It’s now even easier to see your ROI, yield, investment and monthly profit at a glance.

If you’ve seen it before (or even if you haven’t), give it a try now to see how your next property investment could work out.

Quick and simple to use

You only need to enter three numbers to get started:

  • your expected purchase price
  • your forecast repair cost
  • the monthly rent you expect

After you’ve entered those numbers you can either scroll down and click “Calculate” or wait a moment to see your results automatically appear.

Set your cash

If you leave the “Cash Available” field empty the calculator will work out the minimum investment you could put in to make the deal satisfy the mortgage requirements.

You might want to put in a bit more to improve your cash flow or perhaps ask for a calculation with a bit less, to see how far away from your target that would leave things.

Tune the mortgage

The calculator comes with some “reasonable” mortgage criteria pre-set but the chances are they wont fit your exact situation. So you can scroll down a bit on the calculator to customise the interest rate, fees, LTV and rental cover details. See the results instantly update as you make changes.

Save, Download or Share

With your results on the screen you’ll also see buttons to:

  • Save & Compare – create a free account and store this calculation, you can then add others to compare different properties you’re considering.
  • Share – get a unique URL for your calculation and send it to anyone you like, they’ll be able to see the exact numbers you entered and full results.
  • Download – we’ll email you a PDF with all your input figures and calculated results so you can keep them for easy reference in the future or to send on.

Profit calculator results

Displayed results

The results don’t just give headline numbers, there’s also a complete table with calculated figures for yield, ROI, profit, required investment, stamp duty, available mortgage and more. There’s even a table giving an outline of how the Section 24 (mortgage interest relief) tax changes will affect the resulting income.

Try out the buy-to-let profit calculator for your next property deal.

Base rate up 0.25% – the cost to your portfolio

Today the Bank of England announced an increase to the base rate of 0.25%, making the new rate 0.75%.

The last base rate increase was in November 2017, nine months ago.

What will this increase mean for your buy-to-let portfolio?

For most investors, using fixed rate mortgages, the effect of this change won’t be felt for a while. (You can record fixed rate mortgage expiry dates in PaTMa to make sure you don’t miss them.)

If you’ve got properties on a standard variable or tracker rate though you’ll likely see the result of this base rate increase quite rapidly.

For every £100,000 of interest only mortgage, a rate increase of 0.25% will cost you an extra £21 per month (£250 per year).

You can use our free re-mortgage buy-to-let profit calculator to see what the effect will be in your particular scenario – enter your own mortgage borrowing and the new interest rate.

The dwindling tax reduction effect

As a property investor you currently still get to claim some of your mortgage interest expense against tax. Thanks to the Section 24, mortgage interest relief changes, this is now rapidly reducing though.

Right now, in the 2018/2019 tax year, if you pay 40% tax on your buy-to-let profits then a 0.25% interest rate rise will actually cost you 0.175% of your mortgage balance. That’s £175 of extra annual cost for every £100,000 of mortgage borrowing you have.

In 2020/2021 the effect will be the same for everyone as there will only be 20% tax relief on all buy-to-let mortgage interest. At that point, a 0.25% interest rate rise will actually cost you, after tax, 0.2% of your mortgage balance per year.

Does this change your next buy-to-let deal?

You can use our free buy-to-let profit calculator and adjust the mortgage interest rate to see what effect this will have on your next projects profit.