When you choose to buy-to-let, your first concern should be how you will get a return on your property investments. If you’re getting a mortgage for the property, you need to consider how much of the rental instalments will cover for your mortgage and how much you will have left as profit. This is also called your rental yield.
You need to research for your property investments. Consider hot spot areas for purchasing property you’re planning to let to a single occupant, a family or for multiple occupation. You need to consider tenant demand. For instance, university cities have a high demand for short term lettings and houses of multiple occupation (also known as HMO). And also remember that you can convert a property into various bedsits as student accommodation. Look also for areas where the population is fast growing. A good tool you could use is Thomas Sanderson’s Buy-To-Let search. Your tenant target will help you decide which location to focus on.
You may find yourself on a cross roads, trying to decide if you’d like to buy a property, have it refurbished for a purpose and then rent it out to your target tenants. For instance, if you choose to rent the property out for multiple occupancy (HMO), it might be a good idea to buy a large property. You can then refurbish it to accommodate a number of tenants, such as students. This can give you a high rental yield and the opportunity to sell up fast, as students rent for a short time.
Once you have made your decision, purchasing property is a conveyancing matter. Did you know that you can buy the property on a different location, a different city to your conveyancing solicitors office? As long as you can easily get to your face to face meetings with your solicitors, the property location isn’t an issue or inconvenience. But do remember that property law in England and Wales differs from Scotland.
Are you thinking of buying property to refurbish and let to multiple occupants? Or you might like long term lettings for long term investments. Please give us a call and speak to one of our property lawyers with expertise in business law and investments. SG
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