Despite crackdowns on buy-to-let associated tax, bricks and mortar is still considered an attractive investment for many. With mortgage rates continuing to be low, investing in property to let out is still not only feasible in Britain but profitable, providing you do your homework and get your figures right.
If you are thinking about becoming a landlord or are an existing landlord wanting to increase your property portfolio, take a look at the following five buy-to-let investment tips.
1. Purchase property in the right area
Some regions are more ‘rentable’ than others. Before committing to a buy-to-let purchase look at the area you are thinking about investing in. Is it close to schools, jobs, transport and shops? Will it be attractive to tenants? Buying in the right area will significantly reduce periods when the property is empty and you’re not receiving a rental income.2. Think about which type of tenants you will target
When considering the area you are thinking about buying in, consider the type of tenants you will be looking for. For example, if you are wanting to buy property in a university city, you may want to reach out to students to rent the property to, which should influence the type of property you buy and how you furnish it.
3. Do your maths
Make sure you work out all of the costs that will be involved with the buy-to-let to ensure you don’t get stung by any ‘hidden’ surprises. For example, when working out the profit you should make from the investment, make sure you include the tax you will have to pay on the rental income, the stamp duty you will need to pay, money for refurbishment and furnishing the property and other costs associated with being a landlord.
4. Look for the best buy-to-let mortgages
Like residential mortgages, buy-to-let mortgage vary significantly in costs and interest rates. Use comparison tools to work out the best buy-to-let mortgages currently available to ensure you pay the least amount of interest for the mortgage repayments.
5. To furnish or not to furnish
Landlords have no legal obligation to rent a property furnished or unfurnished. However, prior to investing in buy-to-let you should consider how you would like to present the property, and factor in any furnishing costs into your overall budgeting.
If you have any questions about letting or renting property, our team of professional agents and property managers are dedicated to helping you meet your letting and renting requirements. Get in touch with our friendly team of property experts today.