Paul
[ My first observation is that you haven't stated what your objective is. Nor quantified this. Is it to produce an income? If so, how much, and for how long? And for who? ]
Onto your question re property & financing the acquisition:-
1) Firstly I'd say that you would be investing in UK B2L's at precisely the wrong stage of the price-cycle.
This isn't uncommon for amateur investors to buy into bubbles, be they property, tech or otherwise, when the retail investors' confidence in the relevant market is high. The trouble is that all of the smart-money would have been invested long before then, and is beginning to look for an exit before the bubble bursts. So from that angle your plans are flawed.
2) Secondly, your income pattern & type would not satisfy the criteria of a mortgage lender. This is irrespective of the value of any unencumbered properties you may already own. The 'issue' the mortgage lenders have is being able to satisfy themselves that you can afford to repay any mortgage (both interest & capital), and that they don't want to be in a position of having to force a sale of the property to repay the debt. This is especially true when interest rates begin to rise within the next 6-9 months.
[There'll already be enough forced sales and re-possessions going on in 15 years time when all those who took out 25 yr interest-only mortgages 10 yrs ago suddenly realise that they have forgotten to set money aside to repay the debt. THAT is when we'll see a big, big slump in the UK property market. THAT is why the banks now don't want mortgages on their books on assets that are almost guaranteed to lose value in the medium term, and potentially to be staring down the barrel of heavy losses and write-offs during 2030-2040. - Banking Crisis #2 anyone? No thanks!]
3) Thirdly, leveraging (ie borrowing) to fund an investment is very high risk. And should only be attempted by those exposing a small percentage of their overall wealth to leverage and who can afford to lose the lot. [But then you're no stranger to gambling]
4) BEWARE: Property is an illiquid asset; you can't sell it simply when you want to since you have to find a buyer and go through the whole conveyancing procedure.
Whereas 'traditional' investments, eg stocks & shares, mutual funds, investment trusts, ETF's etc can be sold (and bought) quickly and easily via an exchange, and proceeds of sales are generally available within a few days. Plus its a lot easier to take advantage of your annual tax allowances, esp Capital Gains, on an annual basis and so reduce your overall CGT bill at the end of the day.
Plus, if you suddenly find you need cash in an emergency, then you can simply sell the investment and have the cash in your bank account within a few days. You cannot do this with a property, where you can't sell-off the odd room or two if you should need such liquidity.
5) TAX & OTHER ONGOING COSTS: Aside from the liquidity restraints of property, the tax in-efficiency factor especially around Capital Gains, and the near-impossibility of securing debt there's also other issues such as:
- not being able to defer the income tax on rental income;
- high entry costs (such as stamp duty, solicitor's fees, mortgage set up fees);
- high running costs (council tax, property maintenance & repairs, insurance, rental-voids, unpaid rent etc);
- high exit costs (inc estate agent fees, legal fees).
6) POSITIVES: The only thing that direct ownership of investment property holds is that it is a more tangible asset. You can see it, you can touch it, and it is familiar (we're surrounded by house & flats, and most people live in one). And it should produce a modest net income, but not a great yield. And that's all.
7) OVERALL COMMENT: As an investment - especially at the present time - now would be a great moment to almost guarantee losing money in the medium term.
But the choice is yours. It's your money that's at stake, and not mine (thankfully).