5 Top Tips For Prospective Buy-To-Let Landlords

With rents rising and many potential buyers thwarted by mortgage restrictions, the allure of property investment is growing. But the business of buying to let can be harder than it seems.

Here are five tips to consider if you’re thinking of taking the plunge.

1. Factor in the time and skills needed. Professional agents specialising in buy-to-let reckon that it takes up about 15 per cent of your working time. So do you have that much time to spare? And how are your DIY skills. You’ll need to be able to fix stuff around the house, or else you’ll find yourself paying dearly for tradesmen.

2. Work out the figures. Calculate the yield from the property (the percentage return that you get in rent, compared to your investment. How does it compare with other investments such as building society accounts or ISAs? Be sure to factor in all the incidental costs such as renovation, gas safety checks, lettings agents and insurance. Don’t expect that capital values will shoot up in the next few years.

3. Get good tax advice. There are plenty of tax breaks available to buy-to-let landlords, such as being able to claim your mortgage interest against your rental income, but remember that you’ll have to pay capital gains tax when you sell, which business owners don’t have to pay.

4. Location location location. A good buy-to-let property is different from a family home for yourself. Areas with hospitals and universities are examples of places where a lot of people rent. And terraced houses with small bedrooms are a good bet. Try to find somewhere that is close to your own property, to cut down on travel time.

5. Mortgage matters. Use a specialist buy-to-let mortgage broker to find the best deal, because there are lots of different options and many are only available through intermediaries. Consider a fixed rate, to give you certainty versus your rental income.

Original comment can be found at The Buy To Let Mortgage Advisory

via Posterize