Buy-to-Let property is fast becoming the investment of choice for anyone looking to create an additional income to fund a better lifestyle now, or as an alternative to a traditional pension in the future.
With over 16 years experience in property, we have listed our top tips of things to consider before investing in a buy-to-let.
Be realistic and accurate with your numbers.
It’s vital to stay realistic when calculating any costs involved in a buy-to-let property, ensuring nothing is overlooked. Make sure you take into account all potential costs including building insurance, mortgage fees, property repairs, letting management fee, refurbishment and redecoration, service charges (if the property has shared communal areas) and cleaning costs between tenants.
A healthy and attractive Yield for a buy-to-let property is typically
considered to be 6% or above.
You can use Yield as a tool to measure how one potential property stacks up against another, when considering which will make a better investment. Choosing a property that requires refurbishment might allow you to increase capital value straight away (provided you negotiate a good purchase price), but you should always buy for cash flow and look upon capital growth as an additional bonus.
Research, research, research.
Due Diligence should become second nature when considering any property investment. Create a check list of everything you need to research from the property itself, to the local area. We’ve suggest the most important to get you started:
How to find a great investment property.
With the increased popularity of buy-to-let properties, it can be a competitive market place to secure a deal. However, there are ways you can stay ahead of other competitors. Firstly, ensure you are in a position to move quickly. Have your mortgage in place and promote the fact that you are not tied in a long chain. Secondly, build a network of estate agents in your chosen area of investment. Keep in contact with them and always be upfront, reliable and true to your word. This will put you in good stead as a serious buyer and not a time waster.
You can also purchase Buy-to-let properties directly through developers. The benefits of this is being able to secure a great property without the unpredictability and competitiveness of buying on the open market. All development properties will be newly built / renovated, meaning far less potential maintenance and repair costs for you. Developers always work in carefully researched areas where there is high demand from tenants, so even though you must always do your own thorough Due Diligence, you can be confident you are investing in an area that has already met the strict criteria of an experienced developer. Purchasing through a developer gives you just as much control over the finished property as buying a property on the open market.
Ready to view some live Buy-to-Let deals?
We have a number of contemporary apartments available (see below) starting from £81,650, targeted at young professionals in major UK cities.
Central Liverpool apartments
These contemporary and fully fitted Buy-to-Let apartments are located in central Liverpool, with huge rental demand…(read more)