Top tips for getting the most out of a buy to let investment
Like all investments, a buy to let property portfolio comes with risks attached. But those risks can be lessened by treating each property as an individual business, making all decisions based on careful financial calculation, and by adhering to the following three standards:
Due diligence and market research is absolutely vital
The success of a buy to let property portfolio begins with the purchase. All costs, overheads, fees and charges must be considered in order to be able to judge suitability. And in order for ultimate rentability to be assessed, irrespective of the cost of a property or its theoretical value as part of a portfolio, it is vital that the local area and associated rental demand is carefully researched. In short, a buy to let property is only successful if there is an adequate rental demand in the area that will protect against void periods.
Gear every upgrade to the broadest market
When purchasing a new buy to let property, it may be necessary to undertake a period of refurbishment. And when planning any refurbishment, it should be geared to the market rather than personal taste. For example, a whirlpool tub may be your preferred personal bathing choice, but it won’t necessarily add to the rental value; a much more cost effective option would be to invest an a good shower/bath combo.
Ignoring minor maintenance issues will cost you dear
Even the smallest maintenance issue can have serious ramifications if left untreated. For example, a dripping tap or small leak can have a serious aesthetic impact to a property – no one wants to see peeling wallpaper or old water stains, even if the leak itself has been fixed. So although the wisdom of fixing a drip before it becomes a flood is obvious, the associated damage (i.e. water stains on plaster or paper) should also be rectified as at the same time to ameliorate further disarray.
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