Knowing what you want from a buy-to-let property can be hard, especially if it is your first purchase. Here are our tips on making the most of your investment:
- Don’t let personal taste influence you. This an investment, so you want to ensure that the property you buy will appeal to the tenants who rent in that market place.
- Budget carefully. You must ensure that the income is sufficient to cover your costs and allow for any void period when there is no tenant and no rental income. Ask us about how we can negate this issue through our Guaranteed Rent scheme. Your expected rental income must exceed your buy to let mortgage repayments by a certain percentage – for example, your mortgage lender may require a rental income of 130% of your monthly mortgage payments. Your mortgage advisor will provide this information.
- Decorate, fit out and furnish to high quality standards, especially kitchens and bathrooms, to attract the best tenants and let quickly every time. Avoid properties which may require lots of maintenance.
- Check to see if properties in the area you have selected are renting and for what price. If there are a lot of properties on the market in the immediate vicinity, ask yourself why?
- Local transport links and facilities are crucial as these are important factors for many tenants.
- Check to see if neighbouring properties are looked after as external appearance often reflects the occupants.
- 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 students, it needs to be easy to clean and comfortable but not luxurious. If they are young professionals it should be modern and stylish but not overbearing. If it is a family they will have plenty of their own belongings and need a blank canvas.
- Don’t use off-the-shelf tenancy agreements from Her Majesty’s Stationary Office or law stationers, or forget to issue the right notices or fail to have a proper inventory and condition report made before a tenant moves in. Leave all documentation to a professional agent.
