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Things To Look For When Buying A Buy To Let Property

Mar 4, 2008
When purchasing a buy to let property as an investment, the main consideration should be where to invest. Bargain properties come up in all sorts of towns and cities, depending on their state and proximity to amenities. Purchasing a buy to let property because it is cheap does not necessarily herald a wise investment.

Always, always research the area you are interested in. Look into the local amenities. Are there good, local schools and colleges that carry good reputations? Particularly if you are looking at a buy to let property that is suitable for a family, you need to consider the local area from the perspective of children.

Open areas of parkland or greenery are always a bonus for families as well as the good schools. Ensure there are suitable choices for doctors and dentists, maybe if you think you would let to working parents, check out childcare facilities. These are all time consuming searches but make a worthwhile advertising tool for your buy to let property.

It won't be too difficult to search the area around your buy to let property for signs of re-generation. Run down areas will offer up cheap houses but check out planning permission listings. Building sites are never pretty but it will show that money is being ploughed into the area, giving hints about what is expected for the areas future.

Culture issues are an important attraction if you are targeting a particular market. Look for theatres, cinemas, clubs, groups, exhibition centres and the like. All these will make your buy to let property an attractive option.

Decent shopping centres are essential for all groups of people. Choice is something that most people are demanding these days and small local shops as well as large, glossy department stores and shopping centres are the order of the day.

For the smaller buy to let property where you might target the single person, look for homes that are just outside of a large town but on a commuter line. The rents will be more affordable than in town so more attractive to workers.

When carrying out your research on the local area, don't omit to check out average local rents on similar size properties. You need to be competitive and not overprice yourself or appear too cheap, as this will attract the wrong type of tenant.

When considering the rent you intend to charge, take into account ALL of your outgoings. Not just mortgage rates but allowances for fluctuations in mortgage rates. Also consider any taxes and insurances on the property.

It is essential to make sure there are enough funds to not only get the property into a letable state but to uphold the maintenance that you will be liable for. To reduce any risk of the property falling into bad disrepair, it is a good idea to employ an agent to look after the property, particularly if you are not living near enough to keep a regular check on it.

It is always a good idea to leave yourself with a contingency fund. Set aside enough money for the possibility of the property sitting empty for two months of the year. This will cover any blips in rent and give you some breathing space.

Buy to let properties can be a good investment but not for the first timer without advice. Always seek advice from seasoned landlords and research and know your area and target tenants.
About the Author
Property expert Catherine Harvey looks at the buy to let property market as an investment. To find out more please visit http://www.propertyinvestment.co.uk/
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