With so many different schemes and options available for the buy-to-let investor, deciding which properties to buy can appear daunting. When starting out at the research and planning stage, the main areas to consider for buy-to-let investments are:
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Location, Location, Location
Often more important than size, the location of the property can become the determining factor for many tenants, together with accessible transport links, local shops and amenities; in the family market, close proximity to a well-regarded school will often secure a successful let. Unsurprisingly, houses prove more popular generally in family markets, whereas apartments are more appealing to single professionals and young couples in central and outer London locations. Both the interior and exterior condition of the property are major considerations for tenants, who require damp-free, structurally sound properties in good order (cracked fittings, marked walls, damaged appliances, grubby kitchens and bathrooms are all off-putting). Think carefully about the size and layout of the accommodation, as most tenants dislike cramped living spaces, odd-shaped rooms, overly-personalised colour schemes and rooms lacking natural light. If the interior is immaculate but the exterior isn't up to scratch, you may well struggle to get people through the door. The property will ideally have central heating and modern appliances, including a dishwasher; if it’s situated in a block, it will benefit from having a lift.
In recent years, tenants have become increasingly ‘clued-up’ and savvy about the local rental scene and often have excellent knowledge of local prices.
Investing in new-build flats, sometimes ‘off plan,’ remains popular and can prove to be an excellent way of investing, depending on your overall objectives, timescales and budget. Before purchasing in this way, there are many areas to consider, including (but not limited to) cash amounts, mortgages, fixed costs (such as service charges in flats), potential repairs and improvements, furnishings, gross and net yields, likely returns on capital and selecting the right developer. However, by buying a property in a new development you will have far fewer issues to allow for in your maintenance budget.
One, two and three beds are generally the most popular (with two beds tending to give a better return on investment), but it is essential that you carry out your homework diligently before purchasing: a potential landlord should compile a cost analysis before committing and have sufficient funds set aside for potential void periods.
Whether you’re a landlord with an existing portfolio or a first time investor in the London rental market, we would be delighted to answer any queries you may have. We are here to provide you with a seamless lettings and property management service for your buy-to-let investment property. Do get in touch.
