The buy-to-let world can certainly seem like a dangerous, mysterious jungle to new entrants and those who don’t have any experience in the property market. However, with a bit of guidance from the pros, you’ll find that getting into the market and making it big in good time is very possible. So how did they do it?
The good old way
Landlords make their profits pretty much the same way and that is by using the money they get from cashing in on one property to buy another one. They repeat the same process over and over until they finally have a small empire. It’s almost like gambling, but not your regular kind of gambling because it is done with calculated risks.
Run away from high service charges
It is great to start out in a place where you don’t get to pay too many service charges, however, if you start out your investment career in more expensive places like London, it is important that you branch out from that area as your portfolio expands.
Protection is key
The average landlord may decide to stick with home insurance only, but the smarter ones go for landlord insurance as well. While landlord insurance is not an obligation according to the law, it can protect a buy-to-let investor from risks that normal insurance won’t protect them from. It can prove to be a serious lifesaver for your finances.
Research is crucial
If there is one thing that all successful buy-to-let investors will agree on, it is that research is absolutely important. Many buy-to-let investors have learned from their mistake of not properly researching an area before buying a property there. By doing proper research, you’ll find out just how much the tenant demand is and if the property is worth investing in. When you know exactly what you are getting into, you’ll be able to decide whether it is worth it or not.
Amenities win every time
Properties located in areas where there is fantastic infrastructure always win. Look out for property located close to good schools and have excellent transport links. Amenities like that are highly attractive to tenants and the houses will always fetch a good price.
Avoid huge mortgages at all costs
Huge mortgages are simply a disaster when you are looking to invest in buy-to-let properties because if you have humongous mortgages on all the houses you own, then you really don’t own anything. What you should be more focused on is how much the investments are bringing in.
The newer the better
The older a house gets, the more likely it is to have issues. Instead of going for older homes, go for new-build homes because they usually have fewer problems and are more likely to comply with building regulations.
Don’t let the buy-to-let investment world scare you away. With the right plan in place, you can make good money in less time that it will take others to do it.