Home » Real Estate » Buying

Making Money From Buy To Let

Jan 3, 2008
Rising house prices and a strong economy make highly favorable conditions for a buy-to-let real estate project. A particularly effective investment, a buy-to-let leaves you with an asset which appreciates in value over the years, in addition to a sustainable rental income accounting for up to seven or eight percent of the overall value of the property year on year. However, requiring a substantial investment up-front, and an ongoing financial and time dedication, the buy-to-let is far from an easy project.

To begin with, you firstly need to analyze areas with potential for high rental income, and low property prices. This means you need to look for somewhere with a high demand for rental properties, and a low demand for ownership. One of the best areas for a buy to let project is near a University or college - students will always need somewhere nearby to live, and will be willing to pay excessively for that prime spot. Another option available to you is to find an older property, or a property which requires some degree of renovation. This will ultimately mean you're paying less on the purchase price, which should allow you to make more on the subsequent rental income.

For most of us, this means raising finance. There are a number of different approaches you can take towards this, namely setting up a limited liability company to raise funds, or by staking your own neck with the bank. Either way, bank funding is likely to be the only real source for the amount of capital you'll require, although you might find special deals on long-term loans for this purpose. You will probably also be expected to put up a substantial deposit from your own funds, so again, it's good to have some spare cash floating around.

After you've bought the property and begun renovation work, it's time to find some tenants. It is crucial at this stage that you check the legal implications of taking on tenants, and understand your obligations and responsibilities as landlord. On top of that, make sure you check all references from tenants to ensure reliability in terms of rent payments. This way, you can reduce the risk of having a non-paying tenant, which could ultimately ruin your venture and destroy profitability.

All in all, the buy-to-let project is a great way to realize an eventual sustainable income, although it is definitely no easy task. By working at it, and ensuring you have fully done your home work, you should eventually end up with a sustainable business which can provide you with an ongoing income and a perpetually appreciating asset.
About the Author
Jonathon Hardcastle writes articles on many topics including Finance , Business , and Real Estate
Rating:
Please Rate:
(Average: Not rated)
Views: 265
Print Email Report Share
Article Categories
    • Artists
    • Gambling
    • Humanities
    • Humor
    • Movies
    • Music
    • Photography
    • Tattoos
    • Television
    • Classic Cars
    • Motorcycles
    • Recreational Vehicles
    • SUVs
    • Trucks
    • Vans
    • Branding
    • Business Opportunities
    • Careers and Jobs
    • Corporate
    • Customer Service
    • Direct Mail
    • Entrepreneurship
    • Ethics
    • Financing
    • Franchising
    • Home-Based Business
    • Human Resources
    • Import and Export
    • Leadership
    • Management
    • Market Research
    • Marketing and Advertising
    • Negotiation
    • Network Marketing
    • Networking
    • Organizational
    • Presentation
    • Project Management
    • Public Relations
    • Small Business
    • Strategic Planning
    • Team Building
    • Telemarketing
    • Training
    • Data Recovery
    • Databases
    • Games
    • Hardware
    • Networks
    • Operating Systems
    • Programming
    • Security
    • Software
    • Spyware and Viruses
    • Ask an Expert
    • College and University
    • Home Schooling
    • K-12
    • Languages
    • Online Education
    • Psychology
    • Accounting
    • Credit
    • Currency Trading
    • Debt Consolidation
    • Insurance
    • Investing
    • Leasing
    • Loans
    • Mortgage
    • Mutual Funds
    • Personal Finance
    • Stock Market
    • Structured Settlements
    • Taxes
    • Wealth Building
    • Coffee
    • Cooking
    • Gourmet
    • Recipes
    • Wine and Spirits
    • Acne
    • Aerobics
    • Alternative Medicine
    • Beauty
    • Cancer
    • Cosmetics
    • Depression
    • Diabetes
    • Diseases and Conditions
    • Fitness Equipment
    • Fitness
    • Hair Loss
    • Heart Disease
    • Medicine
    • Men's Health
    • Muscle Building
    • Nutrition
    • Skin Care
    • Supplements and Vitamins
    • Weight Loss
    • Women's Health
    • Yoga
    • Arts and Crafts
    • Babies
    • Collecting
    • Elderly Care
    • Genealogy
    • Hobbies
    • Parenting
    • Pets
    • Pregnancy
    • Woodworking
    • Feng Shui
    • Gardening
    • Home Appliances
    • Home Security
    • Interior Design
    • Landscaping
    • Affiliate Programs
    • Article Marketing
    • Auctions
    • Audio
    • Banner Advertising
    • Blogging
    • Broadband
    • Domain Names
    • E-Books
    • E-Commerce
    • Email Marketing
    • Ezines and Newsletters
    • Forums
    • Internet Marketing
    • Link Popularity
    • Pay-Per-Click
    • Podcasting
    • RSS
    • Search Engine Marketing
    • Search Engine Optimization
    • Security
    • Social Media
    • Spam
    • Video
    • Viral Marketing
    • Web Design
    • Web Development
    • Web Hosting
    • Copyright
    • Cyber Law
    • Intellectual Property
    • National, State, Local
    • Patents
    • Regulatory Compliance
    • Trademarks
    • Baseball
    • Basketball
    • Boating
    • Cycling
    • Extreme Sports
    • Fishing
    • Football
    • Golf
    • Hockey
    • Hunting
    • Martial Arts
    • Running
    • Scuba Diving
    • Soccer
    • Swimming
    • Tennis
    • Dating
    • Divorce
    • Marriage
    • Weddings
    • Astrology
    • Buddhism
    • Christianity
    • Faith
    • Hinduism
    • Islam
    • Judaism
    • Meditation
    • Metaphysical
    • New Age
    • Cable and Satellite TV
    • Cell Phones
    • Communication
    • Gadgets and Gizmos
    • GPS
    • Satellite Radio
    • Video Conferencing
    • VoIP
    • Addictions
    • Coaching
    • Goal Setting
    • Motivational
    • Stress Management
    • Time Management
    • Clothing
    • Electronics
    • Fashion
    • Gifts
    • Jewelry
    • Causes and Organizations
    • Environment
    • History
    • Holidays
    • Men's Issues
    • Nature
    • Philosophy
    • Politics
    • Women's Issues
    • World Affairs
    • Air Travel
    • Camping
    • Cruises
    • Destinations
    • Outdoors
    • Article Writing
    • Book Reviews
    • Copywriting
    • Fiction
    • Non-Fiction
    • Poetry
    • Quotes
    • Screenplay
    • Tools and Resources