Top 10 tips when purchasing a Buy-to-Let Property

12 Apr

purchasing a buy-to-letHere are just a few tips to help you if you are thinking of purchasing a buy-to-let, courtesy of Propsavvy.com

Research Location

Research thoroughly in a location before even deciding to invest. Check for local amenities, transport links, schools and more. These factors will all have an effect on the value and rental demand for your property

Define Tenant Profile

Think about what type of tenant you are looking for to reside in your UK property (family, young professionals, students) and present the property according to this type. There is no point producing a five star quality home when the local rental market requires student accommodation – you’ll be wasting your time and money. If your property is classed as a HMO (House in Multiple Occupation), make sure the property has a licence to operate from the local council.

Talk to a broker

Some buy to let mortgages are not available direct so get a complete picture of the finance available, consider using an independent specialist broker that has access to the whole market. They will have the necessary experience to match your borrowing needs. Make sure you use a broker that is part of the National Association of Commercial Finance Brokers.

Monitor buy-to-let rates

Monitor market rates and compare them to yours. Look to see if switching to another rate makes more financial sense. Make sure you are getting the best deal possible.

Maintain your property

Weigh up the pros and cons of maintain your property yourself or paying a letting agent to do it for you. If managing yourself you need to consider whether you have the right skills and contacts to make sure things are done quickly and efficiently.

Check your tenant

Undertake credit reference checks on new tenants. Tenant referencing checks can cost as little as £10 per person. You should also ask for an employee reference.

Protect tenant’s deposit

You must, by law, protect tenants deposit via a deposit protection scheme. Failure to protect the deposit could result in you having to compensate the tenant up to 3 times that of the deposit.

Claim Landlord Insurance

Landlord insurance is designed specifically for rental properties and covers circumstances not covered by normal household insurance. If you own multiple UK properties you could save money using an insurer that will provide cover for all properties on a single policy.

Keep Records

Keep accurate records for each UK property you own. Create a simple spread sheet or if you have a number of properties you could hire a bookkeeper.

Become Accredited

You can get support from your local council, many of which offer accreditation schemes to help landlords protect tenants interests.

Hopefully this helps you when purchasing a buy to let property. If you need any more help please contact Propsavvy for further information on this and other BMV property.

 

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