As a landlord you are likely to experience ups and downs in managing your property interests but the rewards can be great.
While no-one says it is easy, there are some hints and tips that can help you make the right investment.
1. A buy-to-let mortgage
Mortgage deals will change over time and you need to ensure the letting income will cover the mortgage now and in the future if the rates increase.
Be prepared to provide a lot of information about your finances to your mortgage lender, even if you are putting down a large deposit. Most lenders will expect you to prove that the rent you will be receiving is going to cover the mortgage.
2. Choose the right letting agent
Beware of online agencies - they might be cheaper, but are you actually getting value for money? Do they know and understand the local area - what makes it great to live in, what are the best transport links? Do they understand the local rental market inside out? Also look around your local high street letting agents and be sure to compare a good selection of them. If considering a letting agency to let your property for you, invite them to carry out a valuation of your property so that you can get to know more about them and see if they are an agency you would like to work with.
3. Before you buy, make sure there is demand for that property
Make an appointment or contact local letting agents to find out which properties rent the quickest in your location, what tenants want and the types of properties letting agents really wants more of on its books.
4. Location, location, location
Properties near certain schools, properties near transport links, properties near certain landmarks or national parks - it is important to understand what potential tenants are looking for in a rental property. If you are thinking of purchasing a family home to let out, it is helpful to pick one near a local school or within a catchment of a good school. If you are thinking of young couples or commuters, what transport links and amenities are near by?
5. Know your budget
It is important that you stick to what you can comfortably afford when making this investment. Whether it is a one bedroom flat or a four bedroom detached family home, there is a market for different property types so make the right investment for you.
6. How much to spend on doing up a property
If you replace the kitchen or the bathroom or embark on a loft conversion, you will wait a long time to recoup the value. The property might let more quickly at a higher price but if it won’t add value or increase the income significantly it is probably not worth doing. On the other hand, while you don’t intend to live in the property someone else will, so it has to be made attractive enough to a potential tenant without you spending too much money on it.
7. Ask your letting agent
If you need assistance or advice at any time, contact your letting agent. If they do not have the answers at hand, they are probably best placed to point you in the right direction for help and guidance.
Have a lettings query? Find your local Felicity J Lord letting agency today.