When you want to choose a Buy-To-Let property, it is important to make sure the heart doesn’t take over from your head. The investment is something that should be appealing to a wide range of people and not always you. Maybe you like chintz and like an area far away from civilization, which is fine – but this is not going to help you in getting rental customers. Look at things from the point of the tenant and not your own.
Below are top tips that are going to help you when it comes to Buy-To-Let investment:
The investment is not a good one if the costs are more than what you get in rent. Carefully work out your budget. There are handy online calculators you can use to determine how much to borrow against the expected rent. You should also factor in agency fees, insurance, and costs of buying. It is important to have a financial buffer in case the property remains property for a few months.
- Rental yield
You need to do your homework when dealing with investment. You can find a lot of resources online that will help you know what the market is doing. Look at similar properties in your area and also look at the style and quality of these properties and how much they are charging for rent. Currently, apartments to rent in Dublin are going for large sums of money monthly and rising due to a property shortage.
- Researching potential tenants
Maybe a property close to a busy street is not your ideal choice, but it could be more affordable and has demand from renters who want to live in a place with easy access and affordability. Who do you planning on renting it to? Young professionals, students, families? Once you have figured who is going to rent to think about the property they might like. Make sure you check with the mortgage company because there are some that come with restrictions on occupants and property type.
- Researching the area
The obvious thing with properties is the fact that amenities and transport links fetch more rent and easier to find renters. You can talk to a local letting agent so you can know the popular areas and where renters like. Go through the local papers and see the types of properties being advertised and the rent they are getting. The internet has made it easier to research about areas even if you are not there physically.
- Internal spec
A modern kitchen or bathroom suit is going to make it easier to rent the property, but such a kitchen and bathroom is going to cost an arm and a leg, and you might not benefit from it that much. Prospective tenants are looking for a nice home, but because it is not their property, they might not look after it that well, and you might have to wait long before recouping your costs. Keep in mind that this is an investment and not a labor of love. Simple fixtures and fittings are going to work, provided they are clean and functional.
- Outside space
Many tenants like it when they have outside space. Most of them are looking to rent a property that comes with a small and easy-to-maintain garden. This is going to depend on the tenants you want to attract. Young families like it when the house has a good garden size, but young professionals and students prefer to live somewhere that has space for sitting out in that doesn’t require cutting grass or weeding every weekend. This is a better option for them compared to a half an acre that is messy and overgrown.
This can be expensive. Tenants like to choose a property that looks nice and is easy to spruce up. Newer buildings are expensive to buy, but they are likely to have fewer costs. Buying a cheap property might seem like the best idea, but it can easily end up costing you over time.
- Checking condition
This is very important even more important than when you are buying your own home. If you buy a property then rent when it is sub-standard, like problems with electrics, you could be held liable. After buying the property, make the repairs straight away. The last thing you want is to be halfway through the rental contract then realizing that the problem has become so acute, which will force you to spend a lot of money on it. Tenants hate inconveniences and you are going to lose out on the rent. Make sure you check the condition of the property first.