If you’re considering boosting your assets by becoming a Buy to Let landlord, you may have been put off by recent reports in the media about increased legislation and tax crackdowns. Denhan Guaranteed Rent has some reassuring advice: “Even though things have changed and it now appears that the Buy to Let market is more tenant focused (instead of landlord focused) than it used to be, there is still a lot to be said for renting out your properties.”
Risky stock markets and economic uncertainty have put lots of investment opportunities on quicksand over recent years, but property investment still remains one of the safest things you can do with your money. Proskips explains, “People will always need houses, and with our population reaching record levels and developers not being able to keep up with demand, it’s still fair to say that investing in property is one of your best bets if you want to make a good ROI in a relatively short space of time.”
So, how can you make the Buy to Let market work for you? Here’s our top tips for success:
Do your homework
Like many things in life, you’ll have a far greater chance of success if you take your time and do plenty of research before making a solid commitment. It pays to read everything you can about the property market and shop around for a great deal. You’ll need to have a good lump sum to invest, so this isn’t a decision that should be taken lightly- the more time you take to understand how the market is working, the greater your chances of success.
Look for property hotspots and up and coming places to invest
This goes hand in hand with point 1. Do your research, talk to property experts and keep an eye on national property news to find a good location for making your money grow. Regeneration projects up and down the country have turned previously undesirable areas into goldmines for investors, so think ahead and look out for areas that are currently under the radar. University towns are also a great idea if you’re considering buying and renting out an HMO (Home of Multiple Occupancy).
Do your maths
You’d be surprised by the number of people who find themselves in hot water after committing to an investment that they couldn’t really afford. Always sit down with a pen and paper before you commit to anything and make sure you’re 100% comfortable with any mortgage repayments and other fees before signing on the dotted line. Lenders usually want you to arrange for rent to cover 125% of your mortgage repayments and many are now demanding deposits of 25% or more, plus there are often hefty arrangement fees to consider. You’ll need to think carefully about whether this is viable and have a waterproof contingency plan for any periods when the property may be left unoccupied. Always shop around for your best deal and be sure that you understand all the small print first.
Consider what type of tenant you want
Different types of tenants want different things from a property. If you’re aiming at the student market, they’ll want somewhere that’s close to Uni and within easy reach of local amenities and places where they can socialise. They’ll expect space, comfort and cleanliness but won’t be able to afford luxury. Young professionals will probably be looking for mod cons and a few luxurious touches, whilst families are likely to want to find somewhere to settle down for a few years and make their mark. It goes without saying that you’ll want people who will keep the property in good order and meet their monthly payments, so it always pays to arrange credit checks, references and invest in an insurance scheme which will cover you should they be unable to pay rent for any reason.
You Choose Windows summarises, “There are still lots of opportunities to make a great return on your investments through property- just do your research and make sure you’re protected financially before making a big commitment.”
This article was brought to you by Property Division
Disclaimer – This is a guest blog written by a third party. This blog does not represent the views or opinions of WeBuyAnyHouse.co.uk