1. Look to maintain a reasonable rental yield - preferably
above 8% gross, 10% if possible.
This means that you might be looking at areas such as Liverpool
or Newcastle or 'inbetweenie' areas - ie Ely (between booming
Norwich and Cambridge).
In areas such as London, you might want to consider ex
Local Authority housing.
2. Check out the competition! A number of streets in a
growing number of towns have become saturated with Buy to
Let properties.
Make sure that you are not buying in a street filled with
'to let' signs.
Things you need to know about competing properties: a)
the condition and size of the property b) the rental price
c) how long does it take to let
3. Keep your property in better condition than your competition
(and plan your finance to allow you do this). The smart
and clean properties always let first and can achieve far
higher levels of occupancy.
4. Add a power shower. A good quality shower can make the
difference between choosing one property against another.
And it is relatively cheap to install.
5. Add off street parking. If possible, apply to the council
for a drop curb and turn the front garden into an attractive
gravel laid parking space.
6. Use quality letting agents to receive enquires from
the best tenants. The best tenants are busy tenants - and
they tend to use specialist letting agents.
7. Sign 1 year leases, with a 6 month break clause. A 1
year lease reduces the risk of your tenant leaving after
6 months - when letting may be more difficult.
8. Consider a fixed mortgage deal. Five year Buy to Let
loans are currently available at a fixed interest rate of
5.99% or less.
9. Keep your mortgage high - but keep spare funds too.
If you invest £20,000 to buy a £100,000 property
then if property values grow by just 5% (£5,000),
then you will make a 25% return on your £20,000 investment.
10. Low service charges. Properties with low up keep and
maintenance will deliver a much better net rental return.
11. Spot the trend - look for movement out of dirty/ risky
cities - or, inward migration into a redeveloped city centre.
Keep your eyes open for transport improvements - especially
public transport.
These properties will deliver the best growth in capital
value.
Neil Lewis is author of several property books including
the www.PropertySecrets.net
newsletter and www.Buy-To-Let-Secrets.co.uk
the secrets of 'hassle free' long term property investment.
