Helpful Advice on Investing in Buy-to-let and Becoming a Landlord
A property investment, post-Brexit, might seem to push back potential investors. But for people who have the quid to spend and the right game plan, a buy-to-let investment can be a lucrative way to monetise your property. With younger people putting off buying houses and the critical shortage of homes to rent, buying property can be a good decision. However, it pays to learn the things you have to consider.
1. Needs of Potential Tenants
While a property might appeal to you personally, it is imperative to look at it from the people who will actually live in it. Choose an area where people would prefer to live. Is it a suitable place to raise a family? For couples, they might prefer an unfurnished property that they can decorate on their own. And if you intend to let it to young professionals, does it have access to transportation or ample parking space? This type of tenants will prefer a furnished apartment and perhaps, a smaller one. The important thing here is to ensure that the property will meet the needs of your tenants.
2. Financial Aspect
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Apart from the down payment you need to prepare, there will be concurring expenses you have to deal with. Some lenders will require that buy-to-let borrowers ask for rent that will cover 125% of the mortgage payment. Moreover, as a landlord, you have to consider you plan to get the services of a property manager. On top of this, you also have to make adjustments with regards to the period the unit or apartment will be empty for a couple of months. These costs need to be sorted out.
3. Return on Investment
This is another critical aspect to consider when looking for property you plan to let. Look at it from a business perspective. Check on the current rates in the market for property-to-let and the going rate for rental fees. It is also wise to haggle for the price even if you have the money to pay for the property upfront. Learn how to negotiate. Of course, find a team of experts to help you in your property investment. They have properties for sale at strategic locations and with specific features. If you do not have cash to pay and will rely on lenders, do your research and look for the best mortgage rates before applying for a loan.
4. Landlord Rights and Responsibilities
To ensure you have a smooth business relationship with your tenants, know what you are expected to do as a landlord. See to it that you cover all the legal aspects of letting your property and learn about your duties as a landlord, such as, repairs and maintenance of the unit, deposits and eviction procedures, to name a few. You also have to protect your interest by being aware of your rights as the owner and landlord. Unless you are an expert in rental laws and have been a landlord for a long time, have a legal consultant.
Despite the uncertainties you might have, you can still build your property portfolio and invest in buy-to-let. Start with these tips and seek the help of a property investment company to walk you through the process.