As a landlord there are many factors which need to be considered when looking at potential buy-to-let property. From researching the ideal rental location to buying insurance. Here are a few main points which are worthy of consideration when looking to invest in buy-to-let property.
Local property in a familiar area may seem easier to tend to, however the local area may not represent the best investment opportunities available. Consideration should be given to property a little further afield which can be bought at a lower cost and let out at a greater rate. Employing the services of a professional property management company can ensure your property is in safe hands wherever it is located.
Once a potential location has been found it is worth taking time to consider the local amenities. Good commuting links to major employment centres are an important factor for young professionals. Close proximity to major Universities and colleges is vital for attracting students as potential tenants. Other factors such as having local parks nearby and the volume of local traffic meanwhile will be considered by young families.
Typically the properties which present the best return on investment or ‘yield’ are one or two bedroom properties with well decorated kitchens and bathrooms, ample storage and good levels of natural light. In areas where families are the most likely tenants, parking facilities, private gardens and security features such as secure entry systems are also good investments.
When looking to invest in buy-to-let property it is worth keeping in mind that the property is an investment and not a home. Try to look at it from the point of view of the types of tenants who are most likely to rent a property in the local area. A flat with multiple bedrooms and a communal kitchen or living space may be more suited to students while a semidetached house with a driveway or garden may be better suited to a young family.
Advice that is often prescribed but seldom taken is to shop around for a mortgage once the decision has been made to purchase a property. It may be tempting to apply for a mortgage with a local bank or trusted building society, however significant savings can be made by looking at alternatives. Buy-to-let mortgages differ from traditional residential mortgages, most lenders will offer around 80% of the property’s value, so this is worth careful consideration when it comes to the initial investment.
While the ‘best deal’ is often regarded as the policy with the lowest monthly or annual premium, in terms of building, contents and specialist landlord insurance, the best deals are often on the more comprehensive policies. While most policies will cover accidental damage, theft and even fire or flood damage, they may not cover intentional or malicious damage to property from a displeased tenant. An adequate level of building insurance is also mandatory if the property it to be let while a mortgage is still being paid.
www.click-let.com are a small but perfectly formed property letting and management services for Edinburgh and Fife, who believe that the purpose of a managing agent is to build a mutually beneficial relationship between landlords & their tenants.