Simple tips for buy-to-letters

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Do your research

This is especially important if you have never invested in buy-to-let before as there are risks as well as benefits to this type of investment. There may be better ways to invest your money if you realise that property investment is not for you.

Speak to other buy-to-let investors about their individual experiences so you can get a better idea of buy-to-let in practice rather than just reading up about it on the internet.

Budget check

Look at the areas that you can feasibly afford. How much money do you have saved, can you afford the deposit, are you likely to be successful applying for a loan or a mortgage? Check house prices thoroughly to get an idea of what you can get for the money that you have. It might be a good idea to view some properties to see what else is on the market, asking the agent to justify the price that is being asked.

Area check

Where are you looking to buy property, where are the best amenities? Look at the location of good schools, where families live, where students want to rent, and if there is good access to public transport or commuting routes. These are the things that potential tenants will look for in a property.

Investment check

What are the rent prices in the area? Are there lots of houses sitting empty or do they get snapped up quickly? Can the rent cover your buy-to-let mortgage and also make you a profit at the same time?

Target Tenants

Think about the market you are aiming for rather than yourself. If you are targeting families they will probably have lots of their own possessions so will want somewhere with room to put them. If they are students they want something easy to clean and comfortable but not expensive or luxuriously furnished. If they are young professionals then they want something that is stylish but neutral.

What kind of land lord are you?

Will you be employing an agent or will you be looking after the property yourself? If you are planning to employ an agent then you don’t have to look for properties that are close to you. Some people prefer to buy close to where they live for the comfort factor but this is not always the best option for making a profit.

Haggling

If you are a first time buyer then this means that you are not part of a chain thus less of a risk to sellers. The longer the chain buyers are in then the more chance there is that something along the chain will go wrong. This means that sellers are more likely to be open to lower offers from first time buyers. This rule is the same for cash buyers who can make quick transactions and complete the sale quickly.

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