Buy To Let Tips
Research is key. It’s always worthwhile checking the expected rental amount with a lettings specialist such as us & not solely relying on the opinion of the selling agent. Remember the selling agent is motivated to sell the property and as a result the opinion of an agent who has no vested interest can differ.
Location, location, location
This does not necessarily mean it needs to be on top of a tube or train station. Demands of tenants change – the pandemic has seen a shift in tenants requirements away from transport to open spaces & local amenities. You need to match the kind of property you want to buy, with locations for people who would want to live in those homes.
Do the maths
Before you think about looking around properties sit down with a pen & paper and write down the cost of properties you are looking at and the rent you are likely to get. By now you should have a good idea on what you can borrow and what monthly mortgage costs are likely to be. You must research what agents fees are & what additional on-going costs to let the property out shall be e.g annual boiler service, gas safety certificate etc.
Get the best buy-to-let mortgage
The mortgage market, for ‘buy to lets’ is awash with many lenders. With interest rates at an all time historic low borrowing money to finance your ‘buy to let’ investment is an attractive prospect. It pays to speak to an independent mortgage broker who can search the market to find a product that meets your needs.
Think about your target tenant
Instead of imagining whether you would like to live in your investment property, put yourself in the shoes of your target tenant. Who are they and what do they want? If they are young professionals are they going to want to maintain a large garden? If it is a family, its possible they will have plenty of their own belongings; does the property offer enough storage for their belongings?
How hands-on you want to be
Buying a property is only the first step. Will you manage the property yourself or use the services of an agent? For a management fee, you can remove yourself from all dealings with your property. At Simon Clarke we can tailor a management package to suite your requirements with our dedicated management department based on the first floor of our Whetstone office.
With changing tax regimes coming into affect over the next few years it’s advised to seek specialist advice from a tax professional. Planning for tax starts from the very outset including the decision whether to purchase a property in an individual’s name or a Limited company. Everyone’s circumstances are different and a tax specialist will be able to advise you on the advantages and disadvantages of purchasing a property in either your own name or a limited company.
Legal Obligation of a Landlord
As a landlord there are a number of legal responsibilities and obligations which you MUST (and should) abide by. These are all necessary; failing to comply with these could result in prosecution. At Simon Clarke we strive to keep you acting within your legal responsibilities & obligations & shall advise you every step of the way what is required of you from marketing your property to moving a tenant in.
Invest to protect yourself
With the different insurances and warranties available to you landlords can minimise any ‘risk’ of letting their property out. At Simon Clarke we use an external referencing agency and are able to offer you Rent & Legal warranty to protect you, in the unlikely event a tenant was to not able to pay rent. The warranty will also cover legal fees to evict a tenant should this be required.
Use a regulated agent
Many landlords make the mistake of appointing the agent with the cheapest letting fee. Every year tenants and landlords lose thousands of pounds and suffer distress through dealing with agents who are inexperienced and do not deal with client’s money in a professional manner. Using a regulated agent will offer you the following benefits;
As members of ARLA PropertyMark (Association of Residential Letting Agents) we keep up to date with changes in all legislations to do with lettings & property management and keep our clients informed of any changes which will affect them & their property.
We would be happy to discuss any potential property you are considering purchasing as a buy to let or if you are moving and considering renting your property out. Our extensive local knowledge will help you make an informed decision.
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