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One of the best and most profitable investments you can ever make is in a property. As with all things in life, however, there are pros and cons to buying a property with the intention of renting it out. It’s definitely a great source of income, but there are some things you must know before finalising your decision.
There are lots of things to factor when making your decision, such as the location of the property, the kind of people that live in the area, and the maintenance costs. To help you filter these out, here are some things to consider when investing in a buy-to-let property.
Even in times of uncertainty, purchasing property has proven to be a pretty safe long-term investment. While house prices may fluctuate over the years, trends reveal that these increase over the long-term. You’ll be able to make a strong profit should you decide to sell the property after several years.
Another advantage of buying an investment property is that you’ll be generating income from tenants. The best part is that these tenants will end up paying your mortgage for you! You can get your capital returned over a number of years.
Tip: try to take advantage of a low buy-to-let mortgage rate. That way, you could further increase your profit!
While you’ll need to fill in a Self-Assessment Tax Return for HRMC and pay a tax bill, you’ll be able to balance out some of the costs against tax. This includes paying for the repairs, the interest on your mortgage repayments for your buy-to-let, and the costs of promoting your rental property. As an added bonus, you’ll also be able to receive tax relief to take care of the costs of renovations like furnishings and maintenance repairs.
The trouble with owning property, however, is that you aren’t certain that it will be occupied the entire time. If you don’t have any tenants, then you’ll have to shoulder the mortgage payments by yourself. Of course, this can easily be fixed with searching for the right tenant, which comes to our next reminder...
Ensuring that your property stays in good condition depends on finding the right tenant to live in it! Conducting tenant interviews and thorough background checks can be very time-consuming. To relieve yourself of some of the headache, you can get an agency to help screen your tenants and properly vet them. Keep in mind, though, that asking an agency for help will reduce your profits—but that’s money well spent if it keeps your stress levels down! Here at ReadyLet we actually manage the entire process for you! and we are one of County Durham’s preferred letting agents. This means you don’t need to stress about finding and sourcing good tenants because we do it for you!
Of course, keeping your property well-maintained starts by setting an example to your tenant; they’ll be expected to leave it the same way they saw it and having them move into a spotless space will encourage them to keep it that way! Properly maintaining your property, however, means that you need to be accessible to your tenants all the time in case an emergency arises. If any of the appliances or utilities conk out, it’s your responsibility to get it sorted right away. At ReadyLet we have a team of builders though who work full time refurbishing all of the properties we sell so they are by far the best in the area before we sell them to investors and any tenants that move in. If any issues do occur, we are the first point of contact for the tenant so that you are not disturbed or bothered at any time. Our local maintenance team will resolve issues swiftly and any snagging issues following our refurbishment are resolved free of charge in the first 6 months.
There are plenty of advantages in investing in a buy-to-let property. Managing it properly, however, can definitely turn it into high return property investments! If you’re thinking of taking the plunge, then keep these things in mind will help guide you in your journey to becoming a successful buy-to-let property owner. Ready Let is a high yielding property company in Durham, England, UK. We provide refurbished buy to let property to our investors with tenants and use our expertise to manage the properties and the tenants for them on an ongoing basis providing our investors with the best service and advice available. Get in touch with us today!