For the past 18 years, buy-to-let has been the best performing asset class and many individuals have turned to property as a major source of income. Investing in property is a wise decision at this stage, as investor confidence is extremely high and the property market has a bright future.
In order to make the right investment decisions when buying an investment property for the first time, you should know where to start and what to look for. There is a difference between earning an average income and generating maximum returns by being aware of a few key points.
The first thing to do with a buy to let property is to perform the necessary research. The first-time investor should consider the type of property appropriate for them, as well as the goals they want for it. You need to consider the best type of buy to let a property based on your needs, including purpose, built, renovation, student, and overseas properties. It’s also important to consider buying from a multi-unit builder if you are planning on investing in more than one property.
Location Is Important
Choosing the right investment location can make all the difference between success and failure. If you’re looking to maximize your returns, consider other areas besides where you live for ease of management and peace of mind. You really don’t have any limits if you have a property manager taking care of your property. Manchester and Liverpool are known for their high yields and are perfect for working professionals looking to buy to let.
Rule With Your Head Not Heart
When you purchase a property for rent, you cannot compare it to buying your own home. As a landlord, you should consider the amenities that will appeal to your market, such as young professionals and students. Rental demand is often high in areas where there are bars, restaurants, shops, and schools within walking distance. Rent increases greatly when a property has good transportation links. You may not look for these factors in a home purchase, but it could be a deal breaker for tenants.
Be Sensible When it Comes To Finances
The fact is that buy to let is certainly a profitable investment and many landlords rely on the property as their sole source of income. Although expanding your property portfolio offers maximum returns, it is important to ensure that your finances are in order and that it does not affect your investments. You should then make a budget and plan exactly how much you are able to borrow or spend as a cash buyer or if you are taking out a buy to let mortgage. It is essential that you are aware of the various tax implications and outgoings that may be associated with this purchase before you sign the contract.
When it comes to investing in property as a first-time investor, this guide will help you to take into account the factors that you need to consider. If you have any other advice, would you be willing to share it? Could you please let us know in the comments below as well?