Making a property investment work for you
With renting numbers high and specifications varying, how do you know where to put your money when it comes to property? To make a property investment work for you financially, you need to have your financial goals in mind before matching these to the right tenant, according to The Buy to Let Show. The series, devised by Katie Faulkner of propertychecklists.co.uk, offers advice to would-be property investors by encouraging them to be led by their reasons for wanting to acquire a property, rather than being swept away by the idea of an easy extra income.
First, Faulkner explains, you need to set your financial objectives, as these will determine which type of tenant you want to attract, and therefore, your property.
She draws on two examples.
Goal: Capital Gains
Tenant: Family looking for a long term let
Criteria: Good schools, leisure facilities and local amenities
Property: 2 or 3 bed house
Tenant: Professionals and Students
Criteria: Close to work or place of study. Walking distance or good transport links.
Property: City centre properties or those further out with 4 or 5 bedrooms.
There are many types of tenants beyond the 20-somethings who can’t get on the property ladder, as is widely assumed. Other people looking to rent include:
- Short term relocation lets
- Those on a waiting list for council houses
- Areas with low supply and high demand
- Working week renters
- Older generations who have sold
Once you’ve identified your financial goal and the type of tenant who will help you reach it, you should look at your own personal aims and budget.
- What can you afford?
- New build or existing?
- House or flat? Remember to consider service charges, ground rent and leasehold in flats
- Buy a property which is already let?
- Build a property?
- Let your spare rooms – in which case your tenant would in fact be a lodger
“Do your research,” says property investor from Livingstone Homes, Andrew Paris. “You can actually fall foul of all sorts of laws, regulations, and be in serious trouble if you don’t get it right.”
Lockyers specialise in residential landlord insurance, whether you own a single property or a large portfolio, including those considered high risk such as in a flood area or with a history of subsidence. We are happy to quote for vacant / unoccupied buildings, houses of multiple occupancy and holiday homes.