If you own properties or you’re keen to get into the property industry, renting may be an option you’re considering. While selling can bring you significant profit in a relatively short space of time, the rental market is growing year on year and buy to let properties may provide you with an excellent long-term investment. If you’re thinking of trying to tap into the rental market, here are some tips to take on board.
Location, location, location
Location is key when it comes to finding the right property. If you’re going to rent out your house or condo, you need to ensure that there’s a demand for rental properties in the area. Research the market carefully, have a look at rental prices and learn more about the kind of properties that are already on offer. It’s also wise to think about who you’re trying to target. Are you looking for students, young professionals, families or older couples? The type of tenant you’re aiming to attract should influence both the location and the budget.
Considering the cost
To make money from property, you have to pay the right price. If you don’t think a house is worth the asking price, don’t pay over the odds. Try and negotiate and if you’re still not happy, wait for something else to come along. Ultimately, you need that asset to appreciate and paying too much at the outset will affect your profit margin later on.
When you’re considering the cost of buying to let, you don’t just need to bear the purchase price in mind. You’ll also need to think about the cost of any work you plan to do and fees charged by property management companies. Set a budget, make sure you’re aware of ongoing costs, and always have a contingency fund. As a landlord, you’ll be liable for repair work if your tenants have issues, such as a broken water heater.
Tailoring your purchase
When you’re on the hunt for a rental property, consider your target tenant. What do they do? How much do they earn? How much space do they want? What features are they looking for? If you’re looking to tap into the family market, for example, try and find properties that are close to good schools, transport links and local amenities. If you’re hoping to attract students, being close to universities and colleges, public transport links and the town or city centre will pay dividends.
It’s also important to consider the tenant when you’re setting a budget. There’s no point in paying a huge amount for luxury accommodation that the majority of students won’t be able to afford. Meet with agents and get an idea of expected rental fees before you make an offer.
If you’re hoping to buy property and make money from the rental market, now is a good time to start your property search. Many people can’t afford to buy now, and renting is increasingly common. Prioritize location, think carefully about fees, and consider the type of tenant you’re looking to attract. Set a budget, do extensive research, and negotiate the purchase price.