Investing in property continues to be a viable option for the majority of people, and successful investors can make a start to make high returns on buy-to-let properties consistently from the moment they begin their portfolio.
The problem is, however, that many people are unaware of how to get started in the rental and property markets. In short, successful investors decide what objectives they want to achieve, how involved they want to be, and then take a systematic approach to property investment.
It sounds relatively simple, and many people can adopt the same approach by following a few essential tips and tricks.
Outline Your Objectives
It seems obvious, but it’s going to be tricky to become a successful investor without knowing and understanding what you want to achieve. This ultimately comes down to one essential question – what do you want your property portfolio to do for you?
The answer to this question is highly individual and unique to each investor and will decide the direction in which you take your property portfolio in the future.
Understand the World of Property Investment
While almost anyone can get into the world of property investment, the most successful investors and landlords understand the market they are getting into before making any serious decisions.
It is essential to get some investment education before investing. Although it can be tempting to listen to friends and relatives, this can often be a bad idea unless they run a successful property portfolio.
However, while education is never a bad thing, there is always the risk of you overpaying for expensive webinars and courses, which is often a bad idea, and the majority of information you require can be learned online in several places for free.
It is important to remember that you will not learn everything only by reading, and as you increase your portfolio, your experience will grow naturally over time.
Do You Want to Be a Landlord or a Property Investor?
Before you invest in any kind of property, it is essential to understand the role you want to adopt, and this will likely relate closely to the overall goals and objectives you outlined at the start of your investment journey.
Deciding to be a landlord or a property investor mainly comes down to the level of involvement you wish to have. Many investors begin their property portfolios by becoming a landlord as well as investing, and as your portfolio increases, so do your duties as a landlord.
It is, therefore, recommended that you research the role of a landlord beforehand, especially if you are investing in property for a challenge as opposed to investing in creating a more relaxed and comfortable lifestyle for yourself and your loved ones.
A Beginner’s Guide to Letting
If you’ve decided to take the plunge and become a landlord and want to become more involved with your property portfolio, there are a range of considerations that you have to make, as it is often challenging to manage the responsibilities of being a landlord and your buy-to-let portfolio.
Many of the aspects listed below are also essential considerations when deciding to invest in property, so it is recommended that you fully understand the following points.
Understanding the World of Buy-to-Let
Understanding the world of buy-to-let is essential if you are planning on becoming a landlord and there are several aspects you need to consider including:
- Buy-to-let mortgages
- Buy-to-let insurance
- Buy-to-let tax implications
Understanding the buy-to-let market is essential when becoming a landlord as well as knowing all the potential implications that come with it. However, a lot of the information you require is readily available online, and it is perhaps easier than ever to become a successful landlord.
Choosing a Location
There are many things to consider when investing in a buy-to-let property, and while your instinct may be to go with the places you know, this isn’t always the best option.
It is crucial as a property investor, especially if you are planning to re-sell the property at a later date that you look at the potential for long term capital growth as well as short term gains that you will receive from the actual letting of your property.
Luckily, there is a plethora of data and resources available online that report the potential for sales and rental growth in various areas of the UK including the likes of Manchester, Liverpool, Birmingham and Glasgow, and many property investment businesses will give you this information, allowing you to make a more informed and educated decision.
Regardless of where you decide to invest, it is essential to conduct all the relevant research before making a final decision. The research you do should not only analyze if the investment is worth it for yourself but how attractive the location is to potential tenants as the tenants will be the core of your portfolio.
Finding a tenant
As a landlord, finding the right tenant is essential, especially if you are planning on taking a less hands-on role to expand your portfolio further.
A combination of in-depth and thorough checks, an honest interview, and instinct can help landlords find the perfect tenant, however, there are some key aspects to look for.
- Stable job – A good, sustainable income is essential when renting a property, and ensuring your tenant can successfully make rental payments on time is a key aspect when tenant searching.
- Background checks – A thorough background checks must when choosing any tenant for any of your properties. Checking aspects such as credit score, the tenant’s right to rent, and previous tenancy agreements can be reliable indicators as to the type of tenant you may have applying for your property.
- First impressions – Often, especially if you have a lot of experience, your first impression of a potential tenant will tell you all you need to know about what the future holds, and trusting yourself is essential to be a successful landlord.
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