It’s no secret that buy-to-let is taking the United Kingdom by storm. As the housing market fluctuates and rents rise ever higher, many people are seeing buy-to-let properties as a safe investment in an otherwise volatile economy. This is especially true in urban areas, particularly in London and the South East of England, where demand is causing rents to rise like never before. As a result, many people who may have previously had no interest in or knowledge of the buy-to-let market have now been alerted to its benefits, and are seeking to enter the market with one or two properties as an initial investment. However, despite what the media tells us, there is still some risk present in purchasing buy-to-let properties, and if not done right, entering the market can cost you more money that it makes you. So, to help all of those first time buy-to-let buyers out there, we thought we’d offer you some expert advice in how to get ahead in the market, with five top tips for buy-to-let success.
1. Look for lettable properties
This is key: you must remember that you’re buying the house to let, not to live in. You need to make sure that the properties you buy are easily lettable, even if you’re not a fan of the décor or layout; the most lettable properties are solid, dependable builds, with good light and space. In addition, it is better if they are ready to let, rather than requiring major works that will cost you time and money.
2. Expand your search
When looking to enter the buy-to-let market, lots of people restrict themselves to a small geographical area, be that within a few miles of their own home or work, or near other properties that they may own. However, as more people enter the market and it becomes more crowded, it can pay dividends to expand your search beyond these limits. You may also want to do some research around average rent prices, so that you can buy in an area where you will be able to maximise your rental profits and pay off the mortgage (assuming you need one) as soon as possible. For most people, this means buying-to-let in major cities, towns, or urban areas, or areas within which rentable housing is scarce. This kind of research may take some time, but it can be extremely beneficial in the long run, which leads us to the next point.
3. Don’t rush into any purchases
This may sound simple, but you’d be surprised at how many people rush into buy-to-let purchases without having thought it through. Take your time, shop around, and make sure that the property is right for you, the area, and your budget – you don’t want to be stuck paying a second mortgage if you can’t let your home or if the rent doesn’t cover it. It may be advantageous to get some help, either from a friend or family member that has their own buy-to-let properties, or from a professional body or estate agent, who can advise you on your best options when it comes to buying-to-let.