IT PAYS HUGH TO RENT OUT.(Features)

HUGH Gregor, 65, has boosted his pension by becoming a property tycoon.

"I live near Bristol, which has a large student population, so when I came into a bit of money I thought it would be a good idea to buy a flat and let it out.

"But when I spoke to a letting agent he said there was an even greater demand from young people coming to work in the city."

Hugh, 65, a retired teacher, bought his first flat for pounds 60,000 in the 1993 property slump and is about to sell it for pounds 129,000. "The rental income more than covered the mortgage and overheads and provided me with a decent income."

Since then he has come into more money from legacies which he used to buy two more flats. He has also got involved in the maintenance and management of some of the blocks in which the flats are situated.

"Organising all this is something I enjoy and it ensures the flats maintain their value." Hugh's lettings provide him with an extra pounds 8,000 a year income.

Buying to let has become a boom business in recent years as more young people in cities prefer the mobility of renting to buying. Bradford & Bingley's John Crossley says renting is the most popular choice with 25-35-year-olds, who now account for 45 per cent of tenants.

He says that buying to let offers returns of up to 10 per cent a year. B&B's latest lettings report reveals that the buy-to-let market increased by 10 per cent in the last year.

If you want to buy to let, you'll need a deposit of at least 15 per cent of the value of the flat as well as money to cover maintenance and any refurbishment.

But there are plenty of mortgage providers who will lend you the rest on competitive terms.

Birmingham Midshires has produced a guide to buy-to-let. For a free copy ring 0500 228822 or visit www.askbm.co.uk

Internet property site www.right move.co.uk is now offering a lettings service.

CAPTION(S):

PENSION BOOST: Hugh