Shifting priorities amongst young people, lack of finance to cover deposits and the growing appeal of city centre living, have combined to create ‘generation rent’ - and with it comes the perfect conditions for buy to let investment.
Be it a novice making their first foray into property investment or an experienced investor with a large portfolio, a few simple tips should always be applied to buy to let investments:
Think closely about the type of property you want to invest in. Spend time researching your options before making a decision, there are plenty of different ways to go in property investment, all of which have pros and cons.
Don't invest in a buy to let property which you have fallen in love with – instead, buy a property which will suit your targeted tenants’ needs. A lack of local bars and amenities might not bother you, but consider what your target tenant might make of it.
Account for maintenance of your investment. Do your sums to ensure you have sufficient funds to cover unforeseen issues which might arise – a broken boiler or leaking tap will be your responsibility to fix.
Consider how hands on you want to be with your buy to let investment. On the face of it, you might be able to make more money by renting out the property yourself, but viewings, maintenance and collecting rent can all eat into your time – and not necessarily during working hours!
Focus on what it is you really want out of a property. Compare different investment opportunities based on a strong yield and potential for future capital growth, and be realistic about where you can achieve this. Average gross rental yield in a buy to let hotspot such as Manchester is currently 7.6 per cent, whereas some parts in London are struggling to achieve 5%, so it pays to do your research.
