Are you hoping to make the leap from homeowner to property guru? If you’re keen to buy an investment property, it’s crucial to make the right calls. Here are some tips to help you get started in the property market and maximise your chances of success.
Financing your investment
If you’re on the lookout for the first addition to your property portfolio, the first thing to figure out is your budget. How much can you afford to spend, and how are you going to finance the acquisition? If you plan to take out a mortgage, it’s essential to shop around and compare offers before you make a decision.
Once you have firm mortgage offers, and you know exactly how much you want to spend on your investment property, you can start looking. Bear in mind that there are many factors that influence how much you spend on a property. If you’re looking to take on a project, for example, you’ll need to consider the cost of repairs and renovation, in addition to the purchase price. It’s also vital to factor in fees you will incur during the purchase process.
Finding the right location
Location is key when it comes to successful property investing. Buying a home is very different to buying a house you plan to let out. You’ll need to think about your target market at all times, and put your own preferences to one side. You may love the idea of living in a remote village, but if you’re a landlord looking to appeal to young professionals or families, this is probably not the best choice of location.
Research the area in which you want to buy thoroughly, take a look at the price of houses on the market and previous sale prices, and learn more about what’s on offer. If you’re hoping to buy a property suitable for a young family, search for homes with easy access to good schools, shops, and transport links. If you can’t afford to buy in well-established, affluent areas where there is a continual demand for houses, explore up and coming neighbourhoods. Get to know local agents, make use of their knowledge, and keep an eye out for new developments and signs of investment in the town or suburb.
Narrowing down your options
When you’re looking for an investment property, you need to focus on making profits. You’re not looking for that warm and fuzzy feeling you get when you’re on the hunt for a forever home. Talk with agents, browse online, and arrange some viewings. Find out more about the potential to add value and expected rental incomes, and make sure there’s a demand for that kind of property in the local area.
There’s no point in buying a stunning home if you’re going to struggle to find suitable tenants. Once you’ve had a look around some properties that caught your eye, arrange to visit again, and compare the contenders. Don’t rush into making a decision, and think about which flat or house is going to appeal to tenants. If you plan to buy and then sell, think about which option offers you the most potential.
If you plan to let out your new property, you probably want to have tenants in place sooner rather than later so that you can recoup your money. Many owners choose to work with management agencies, which take care of the process of sourcing suitable tenants. As a homeowner, you want to enjoy peace of mind that your property is being well looked after, and an agency can help to ensure that your tenants meet your requirements.
If you’re a landlord, you can specify whether you’re prepared to accept pets, smokers or young children in the property. You can find tenants by placing adverts online or in the local press, and it is possible to set up informal meetings so that you can get to know people who express an interest in your property before you sign a rental agreement. The contract will determine the length of the tenancy. If you have an agreement coming to an end, it’s a good idea to start searching for new tenants in advance so that there isn’t a gap. A managing agent can take care of advertising and arranging viewings for you.
Are you thinking of investing in property? If so, it’s essential to ensure you have plans in place to finance the acquisition and to make sure you find the right property in a location that will appeal to tenants or buyers.
Do your research, explore your options, make use of local knowledge, and don’t rush into making decisions.