Buy to let for first time buyers in the UK
But to let has become one of the most profitable investment opportunities that you can find out there in the world. However, first-time property buyers should keep few important tips in mind when they are going to buy to let investment opportunities. If you go for the right investment, you will be able to avoid frustration in the long run. Also, you might want to check other relevant information where we explain all the Important tips that first-time home buyers should keep in mind.
Here are some useful tips that first-time property buyers in the UK can keep in mind to stay away from frustration as much as possible.
Do a comprehensive research on the market
First of all, you should do a comprehensive research on the market. Otherwise, you will go ahead and purchase buy to let a property without having any idea in mind. If you make such a decision, you have to end up with a loss at the end of the day. When you are conducting the research, you need to figure out that the buy to let investment is the perfect option available for you to consider. If you notice that it is not the best investment opportunity and you can get a better return elsewhere, you should never move forward with it.
Select the most promising area
Investing in buy to let property in some of the areas can deliver better results to you when compared to other areas. Unfortunately, most of the people misunderstand the term promising. Promising doesn’t mean the cheapest or the most expensive investment. Promising is related to an area, where people prefer to live. Several factors can contribute towards this fact. Therefore, you need to take look at all possible factors and determine the most promising area to invest on.
Do your homework
All the first-time property buyers are encouraged to do homework on math before they invest in BTL. You need to take a pen and paper and allocate few hours on this. Usually, you need to receive at least 125% as the rent, so that you will be able to cover up the mortgage repayments without going through any frustration. If you can get a rent higher than that, you have nailed the perfect investment opportunity. Hence, you can go for it without keeping any doubt in mind.
You should never go for the first investment opportunity that you come across. Instead, you need to shop around for all available options and go for the perfect option out of all. Then you will be able to go for an investment while having a perfect understanding about the market rates. Hence, you can avoid the frustration of making an overpayment. You should also shop around when you are obtaining the buy to let mortgage.
Focus on the target tenant
It is a good idea to have a clear understanding about the target tenant in your mind when going for a buy to let property investment. That’s where you should get into the shoes of the target tenant. Then you will be able to determine whether you are interested in living in the home and what you expect to receive during the stay.
Never be over ambitious
As a ground rule, you should keep in mind that it is not a good idea to be over-ambitious while you are looking for a BTL property. If you do a simple research on the internet, you will be able to come across the stories of individuals who became millionaires through BTL property investments. However, only few people who go for this investment opportunity end up with such results. Therefore, you should never keep high expectations when you are investing in BTL property. This can help you to avoid frustration in the long run.
Don’t stick to your neighbourhood
Most of the first-time property buyers tend to invest in their local area. This is one of the biggest mistakes that they do as well. It will not be possible for you to look for the best investment opportunity in your local area. But you can find a better investment somewhere else. Without sticking to your area, you can take a look around for the other opportunities available. Then you will be able to go for the best possible results at the end of the day.
Negotiate the price
It has also been identified that first-time property buyers are a bit hesitant to negotiate. You should never do that mistake. It is perfectly fine for you to go ahead and negotiate upon the property that you invest in. When you negotiate, you will be able to reduce the amount that you spend. This will assist you to save a considerable amount of money in the long run as well. For example, if you take a look at the amount you have to spend on mortgage interest, you will be able to figure out the importance of negotiations.
Know the pitfalls associated with your investments
Buy to let investments are associated with a lot of pitfalls as well. Therefore, you should be having a clear understanding about these pitfalls. Then you will be able to act in advance and make sure that you don’t become a victim of them. For example, if the predictions show that house prices can fall in the future, you need to realize that you are not going for the best BTL property investment.
Consider the level of engagement
Last but not least, you need to have a clear understanding about the level of engagement you must have when you have gone for the BTL property investment. If you rent out the property on your own, you will be able to make more money. However, it comes along with a lot of hassles, such as advertising, viewings and repairs. If you are not in a position to go through this hassle, you can simply get the assistance of an agent.