Tips and Advice for Buying a Flat to Rent Out
01 June 2015 3855 Views
There’s no denying that choosing to invest in buy-to-let property can be a great way to make a profit and as an added bonus, you’re providing a home for tenants in an already oversubscribed market. However, while it’s easy to make such statements, in order to physically realise such a success there are steps you need to take in both the acquisition and letting of your flat.
Here, we take a look at what you can do to help make your investment risk-free and at the same time help to make your letting run as smoothly as possible.
Target your Market
Knowing who you want to rent your flat to is important and will ultimately inform your purchase. For example, if you’re wanting to let to students you want a functional property, possibly open plan, that’s easy to manage. Whereas if you were targeting families, you’ll need a flat which has close bedrooms, probably ground floor and has decent facilities.
Choose an Area Wisely
When you’ve targeted your tenants, the area you choose needs to also be appealing to them as well. Look into what amenities are nearby, the transport and commuter links and what the people living around the neighbourhood are like.
Equally, you need to think about the future of this area and how this might change in the coming years. If possible, look into development plans for the region and area and what this could bring. These factors could have a significant bearing on how quickly you let your flat and also look into how much prices have risen by over the last decade and if it’s above the national average.
Make Sure your Numbers Add Up
Don’t dive straight into buying a flat once you’ve got an idea of your demographic and area; take the time to fully consider your expenditure and possible income. Add up the following:
• Your deposit
• How much you’ll put aside to repair/modify your flat
• The cost of any furnishings (if applicable)
• Legal fees and agent’s costs
• Your personal expenses
• What you roughly intend to charge
• How much yield you think this will gain
Seeking professional financial advice for this could be beneficial for you if you’re unsure about anything, as getting your figures right first is hugely important.
Are you a Landlord?
You need to be realistic about how involved with your rental property you intend on being; especially as a first-time landlord. Managing this, your job and personal life can be quite an undertaking and you have legal obligations you must follow. You can of course work through professional estate agents and leave it to them to take care of this side of your investment.
So, make sure you take on board some of this advice and you’ll be on your way to a successful let in next to no time.