Choosing to purchase property for rental is a big decision, but it can turn out to be one of your best investments. The buy-to-let sector is a huge opportunity, with significant growth in the number of prospective tenants throughout the UK making this an appealing option. Let’s take a closer look at a few top tips for ensuring your buy-to-let investment works for you…
For those with the money to raise the deposit, buy-to-let presents ample opportunity to become a landlord. Tenants are on the rise, with fewer domestic purchases and a more mobile workforce. It’s understandable that of all the investment opportunities available, there is a certain reliability about bricks and mortar which continues to impress – however as with any new investment, it is encouraged that you proceed with caution.
Select your investment area with care
Be careful not to be seduced by price alone – as a prospective landlord, you need to search for areas and properties where people want to live. This must match up with your financial constraints to create the perfect buy-to-let conditions. For instance, is the location expecting sustainable long-term growth? Is there an attractive tenant pool? Are there any infrastructure changes currently taking place? All of these might sound like simplistic questions but answering them will get you one step closer to selecting the right buy-to-let property.
Who is your dream tenant?
It’s vital to get into the mindset of a prospective tenant, rather than becoming too fixated on where you would like to live. Are you hoping to appeal to young professionals, or growing families? These demographics require vastly different things from a rental property – and will also help you get a clearer idea of how long your tenants are likely to stay in the property.
Research your options
Buy-to-let is still an attractive investment, but it’s getting more difficult as new taxation rules on mortgages have had an impact on the market, though Brits are still flocking to this valuable means of creating capital. Mortgages for buy-to-let are traditionally cheap, though investors need to remain aware of the impact that interest rates and stamp duty will have on their house price – as well as the rental value of their new home. Adequate research is extra-important if you’re new to the buy-to-let market, as you need to be aware of both the benefits and all the potential risks. Property investment is the right choice for many people, providing capital gains and a consistent income, but always be sure of what you’re signing up for and seek professional advice before you sign on the dotted line.