Buy-to-let investment remains an interesting choice in the UK because more people are now renting. High house prices mean more people cannot afford to buy, and the demand from tenants continues to rise. Here are five more tips for a successful buy-to-let.
Go for yields
It is true that property investment has created millionaires, but it is more realistic to consider rental yields from your properties and not whether their prices are likely to grow. It is practical to invest for income rather than capital growth. You can use online rental property sites such as Rightmove to see average rents and work out the yields.
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Look further afield
If you are going to use a property management company to look after your investments, you can afford to look further afield for properties. Although London may look like a good option, yields are low and prices are very high. Your money will go further in northern university cities, for example. Here you will have high demand, lower property prices and healthier rental yields.
Buy rundown properties
If you like a challenge or have knowledge of the building trade, you could buy a cheaper property in a good area that is run-down and needs renovating. This is one way to boost your investment. Calculate the renovation costs to make sure they will be more than covered by the increase in value or the rent you can attract. Larger properties could also be converted so that they all have en-suite bathrooms to attract professionals, or they could be turned into flats or houses of multiple occupancy, such as bedsits.
Make sure you’re covered
You can take out specialist insurance that will cover for any loss of rental income, damage or legal expenses. Think about the specialist insurance you need and make sure you have adequate cover. You can find out about cheap landlords insurance from companies such as https://brokersdirect.co.uk/?product=landlords-insurance.
Look at the work involved
Investing in property is the first step, but you need to think about what happens next. Are you going to do the work yourself to find tenants, check inventories, draw up contracts and undertake maintenance, or will you use a letting agent? Agents will charge a fee, which will need to be factored in to your expenses, but they have the experience to market your property properly.