The Buy to let Summary spreadsheet doesn't seem to show the cost of major refurbs it only seems to request a changed value after refurb. It is taken account though on the Managing sheet. Have I misunderstood?

Hi Bob In the Summary tab, the ‘Capital profit on sale of property’ does not take into account refurbishment costs. This figure only takes into account the costs of the purchase and sale of a property over the years given a certain capital growth rate. However, the ‘Rental Profit (loss) figure does take the refurbishment costs into account (both setting up costs & refurb costs per year). This is taken from the Managing tab. Therefore the ‘Realised Profit if you sold the property’ figure is important as the refurb costs are taken into account in this figure. Hope this makes sense. If you would like to go through it further please don’t hesitate to give me a call via the Customer Services number. Kind regards Lindsey

Firstly let me say the spreadsheet is a very useful tool but it could be improoved. The main area I would point to is the way in which it does not show very clearly - certainly in graphic format the overall profit / loss figure for the whole venture. For instance if you have a 5% yield on a property at present then for the first perhaps 10 years there will be an annual rental loss that is created (depending on how quickly rents increase (they've fallen over the last 6 years) and the cost of borrowing) and which needs funding from your own resources. This is shown in the cashflow graph but it is not shown anywhere else To get a true picture of the total profit you need to subtract these annual losses from the capital growth and also add in these annual subsidies to the 'cash in bank' black line on the capital growth chart. This capital growth line should also be growing at a higher rate than this spreadsheet uses since nowadays you can get more than base rate on your money if left in a bank. Of course if the money you use to subsidise the rental each year is put into a pension and you get the 40% tax back from HMG then then the overall growth of the true cash position versus even the geared capital growth starts to look very different indeed particualrly when you take into account the tax you have tp pay on sale of a property. Of course it can get quite complex with all the different factors to take into account but currently the spreadsheet is rather simplistic in these areas and inflates the property opportunity over and above the reality which it seeks to compare itself to. I have mentioned this before - perhaps not quite so fully and would be interested in PS' view on this. Thanks