It’s no secret that the rental market in the UK is booming, with so many people being forced to rent a home rather than buy one. Many individuals simply don’t have the cash required to own their own property, so seeking a deal with a landlord is the next best thing.
Of course, this has made buy-to-let investments incredibly attractive to those who do have the money to buy a second home and rent it out. Some entrepreneurs have even used the difficult financial period as an opportunity to build a property portfolio that gives them the chance to enjoy a regular and substantial rental income.
Lower house prices and rising rents have combined to turn the market very much in a landlord’s favour. This is tempting many to up their investment in bricks and mortar. Another contributing factor is the low interest rates, which mean that any large sum of money is unlikely to accrue much interest if it’s left in the bank, so it may as well be used for a property purchase.
People who are thinking of becoming a first-time landlord or adding to their property portfolio of houses available for rent may be wise to consider some of the top tips on the matter. Here are ours:
#1. Research the market
Spend plenty of time doing in-depth research, as there is clearly plenty of risk attached to any property acquisition. So being as confident as possible that the building, location and price are right is a must.
#2. Can you rent out the property in question easily?
Is there a demand for homes of its size and quality in the local area? Researching the neighbourhood is a wise move, as it should unearth some local trends and features.
#3. Do your maths
It’s vital to have a tight grasp of the sums. You need to work out exactly what you can realistically expect to gain in rental income and how many months of the year the property is predicted to be filled for and compare this to the initial cost of buying it as well as any ongoing fees and expenses that are set to be experienced.
#4. Get a good mortgage deal
One way you can get the best out of a buy-to-let deal is by shopping around for a top mortgage deal. Settling for second best could leave you thousands of pounds worse off over a period of time, so securing the best terms possible should be a priority.
#5. What type of tenant do you want?
Some time should be spent evaluating what type of tenant you want, as advertising procedures can be tailored to reach out to these people. Finding the right people to live in a property can ensure a hassle-free and more reliable future.
#6. Do your homework
Buy to let is not always as easy as it sounds and those who go into it blind stand to lose plenty, so doing the necessary homework first is a must. Taking a realistic viewpoint and setting strict budgets should put you in a strong position in the long run.
Published on: December 31, 2012