Buy-to-let investment tips
Buy-to-let property has been a good investment platform for many, but it is definitely not a get-rich-quick scheme. As an investor you need to ensure that your investment can pass the test when interest rates do go up, which inevitably they will at some point.
Successful property investing requires strategy and real market knowledge that can be put to use. As an investor, you need a clear strategy for maintaining your property portfolio. So, you may need to target a particular demographic, area, or a certain type of property. Research is also needed to keep up to date with market trends and keep the portfolio in good shape. Doing it correctly takes motivation and organisation. You need to be able to organise your schedule to allow time for research. To be successful in this investment, it generally takes a support team – understand the importance of human relationships! The most important people that a serious investor will have by their side is first, a good lawyer. It is in a landlord’s best interests to be familiar with the relevant laws, and a lawyer can help familiarise you with the key points of leases, which sometimes, can be anything but straightforward to understand. Secondly you will need an accountant, to help with statutory compliance matters like rental accounts, personal tax returns, and representation in the event that HMRC makes you, the investor, the subject of an enquiry.
- Do the maths – make sure you have a deposit big enough to get a good rate on your buy-to-let mortgage.
- Research the market – know the risks and benefits and research the area you wish to invest in.
- Compare the market for the best deals. Talk to an independent mortgage advisor to gain a greater insight.
- Choose the right area – there’s no point investing in an area that no one wants to live in.
- Know that buy-to-let investments are not suitable for short term investment goals.
- Think about the type of tenant you want to attract – decorate the property accordingly. If you are not sure discuss your options with an experienced estate agent.
- Negotiate – For many investors you will have the advantage of being chain free, if you are not relying on funding the purchase through the sale of another property.