As a buy-to-let landlord, your choice of property is critical in ensuring you achieve the best possible return from your investment and minimal vacant periods. Don’t let your personal preferences influence your business decision.
Set a budget
It might sound obvious but work out your budget first. This will dictate both the type of property you buy and its location. Start with some basic research into house prices and the typical rents being achieved in those areas. At Home In Edinburgh can advise on rental prices.
Don’t over-stretch your budget. Remember there will always be unexpected expenses and some vacant period between tenancies.
Buy-to-let mortgages
The key element to your budget is your mortgage. For a buy-to-let mortgage most lenders will probably demand a deposit of at least 25%. They will also usually require that rental income from the property is 125% of the monthly mortgage payment.
At Home In Edinburgh recommends http://www.caileanltd.co.uk/ for financial & mortgage advice.
Attracting the right tenants
Tenants will select a property that fits with their lifestyle and your purchase location will impact on the type of tenants you hope to attract.
Families want to live close to good schools. Young professionals are more interested in good transport links as well as sports and leisure facilities. If you want to let your property to students, you should obviously try to buy somewhere close to the college or university campus.
New build or traditional tenement?
There is no right or wrong answer as different tenants will prefer different options. There may be fewer short term maintenance problems with a new build but that needs to be offset against the premium that can be charged for a tenement property full of character.
Outside Space
Good quality outside space is at a premium in Edinburgh but some outside space and a well-kept garden or communal garden will add to the marketing appeal of your property, especially if you are targeting families.
Negotiation
As a buy-to-let landlord you are in a strong position as you are not involved in a chain. Don’t hesitate to use this to your advantage when negotiating on price.
Don’t panic and offer on the first property you view. Take your time and view your favourite property at different times of the day before making a decision on a purchase.
Support From At Home In Edinburgh
We can provide advice on where to focus your search to maximise rental yield and potential for capital growth.