Buy to Let Advice – Everything You Need To Know

When you are first starting out within the property market, it is very easy to become unsure of what you actually need to know. Don’t worry – it is all-natural that this happens. Everyone who has first started out with their buy to let property has been in the shoes of a brand new landlord who knows nothing. To give everyone a helping hand, here is a guide of advice on everything you should know before you step out into the big world of owning a property.

Buy to Let Mortgages

It is important to establish interest rates before investing in a buy to let property. Even though lower interest rates may make borrowing money simpler at first, you should be certain that rental income from your property will cover the mortgage both now and in five years. This is because interest rates are likely to fluctuate over a period of time. A mortgage for a buy-to-let property is not the same as a mortgage for a primary residence. The amount you can borrow is determined largely by the expected rental earnings from the property.

However, in some cases, alternate sources of income are explored. Some lenders require that your rental income be 25% to 45% greater than your mortgage payment as a rule of thumb. Eligibility criteria may also differ depending on who you approach.

Do Your Research

A good recommendation is to consult with a buy-to-let mortgage broker who specialises in this area. They can walk you through the numerous options available to you. If you’re wondering whether you can afford to buy a rental property, determining your affordability will help. If you have a significant sum of money, you might consider buying two properties or making a higher down payment.

Choose the Location Wisely

It’s tempting to look for a reasonably priced two-bedroom apartment far from where you live. But proceed with caution. Being unfamiliar with the location can cause considerable difficulties and perhaps losses. It’s possible you’re unfamiliar with the local market. Because the local rental market may be poor or deteriorating, you may have difficulty finding renters and renting out your property.

If you decide to sell the residence, you may have to travel and may incur financial losses. Consider the prospective tenants in the area. Will there be a demand for young professionals, students, or families? This will also influence your choice of buy-to-let property.

Old or New Property?

This will be influenced by your choices, money, and the length of time available to finish the remodelling. Tenants favour newly built flats because they make renting more convenient. They are typically aesthetically pleasant to young professionals looking to rent. When searching for a buy-to-let property, remember that the owners of other new-build apartments will be competing for the same tenants as you.

Weigh Up The Cost

If you overspend on renovations, you will have to wait a long time to regain your capital. While the rental property may fill up with tenants quicker, renters may be able to find a suitable rental at a smaller cost. Specific standards must be met by your home. It is beneficial to ensure that everything is in functioning order and to have needs such as a refrigerator and washing machine.

Do I Need a Buy to Let License?

Landlords are obliged to have a licence in several parts of the UK. If your property is an HMO, you may need an HMO licence. HMO legislation and licencing requirements, however, differ by the council.

If you do require help in getting an HMO license or need more information about it, contact us as we are able to help you in regards to this.

Which is Better: Furnished or Unfurnished?

If you rent to students, you should supply furniture that is robust and can tolerate student life. Because tenants can personalise the area, vacant homes may be more appealing for longer leases. A third alternative is to rent a partially furnished house. If you’re ready to be flexible with the furniture you give, your buy-to-let property can appeal to a broader market.

You’ve got Your Buy to Let Property, Now What?

It is critical to have a tenant ready to move in as soon as possible. Once your tenants have moved in, your first obligation should be to collect rent on schedule. When it comes to collecting rent and other bills, many landlords are not concerned if these payments are collected on time. When you get behind on your payments, you could soon be pursuing unpaid invoices for six months. If you have a mortgage, this could lead to financial difficulties. Whenever tenants fail to pay their rent and ignore notices, the eviction process should begin as quickly as possible. If your tenants are constantly late with their payments, they must be dealt with by letting agents.

Create a Good Relationship with Your Tenants

Making a relationship early on can be very useful. If you want to inspect your property on a regular basis, you’ll need the approval of your tenants. To gain their trust and respect, perform a few simple activities such as providing them with a welcome gift prior to inspections and providing ample early warning.

How Can We Help

Here at Robert Manning, we take pride in all of the work we do for our landlords. That is why we have 3 specific services for any landlord who comes to us for help when it comes to their property. Our landlord services cover; let only service, let & rent collection service and fully managed service.

If you are interested in finding out more information on how we can help, contact us at 0203 725 8399 or email us directly now for a free quote.