This property must be good value now - compared with similar properties today, and not based on value of properties increased by 10% for every 2-3 years to build the next period.
Location, location, location - One development probably 20% cheaper than others, why is that? Which will increase the value more? What attractions / amenities are there now / will be there at the time of completion? What might be built around development in the next 2 years while being built - would that look fantastic still be there?
Is mathematics ?
Before you think about looking around properties sit down with pen and paper and write down the cost of rental house you see and you're likely to get. Traditionally buy-to-let lenders want rent to cover 125% of mortgage payments, although some of these relaxing, and interest rates higher. Most are also looking for a deposit of 15%, which protects against falling prices.
Think about your target tenant
Instead of imagining whether you want to live in your investment property, put yourself in the position of your target tenant. Who are they and what do they want? If they are students, it must be easy to clean and comfortable but not luxurious. If they are young professionals it should be modern and stylish but not overbearing. If their families will have plenty of their own property and need a blank canvas.
Know the traps
Before you make an investment you should always investigate the negative and positive aspects. General consensus is that house prices are relatively stable, but they may go down slightly or even further. If that case will you can keep your investment? Even in popular areas properties can sit empty. One of the benchmarks many buy-to-let investors apply is to factor in the property sit vacant for two months this year to provide substantial buffer. Houses are often necessary to improve and things can go wrong. If you do not have enough in the bank to cover major repairs to your property, do not invest.
Consider how hands-on as you want
Buying a property is only the first step. Did you rent it out yourself or get an agent to do so. Agents will charge a management fee, but will deal with any problems and have a good network of plumbers, electrical and other workers if things go wrong. You can make more money by renting a property out yourself but be prepared to give up weekends and evenings on viewings, advertising and repairs. If you choose an agent you do not have to go to High Street presence, many independent agents offer an excellent service and personal. Select your shortlist large and small agent and ask them what they can offer you.
Minimise void periods
Key ways to minimize the void period is to have neutral decor, investing in areas of high demand, finding a new tenant soon after notice given and investment in the property type of interest in the area.
Think long term - unless you bought the property from the plan and intends to flip it for resale and profit before completion you should view real estate investment as long term investment. Real estate is slow to liquidate asset, cash tied up in property is not simple to release. Taking a long-term approach to portfolio of property and assets you give time to increase its value before cashing them for profit.
Consider further the field - there appeared the real estate market property around the world where the nation's economy will be stronger, where the growing tourism sector is pushing the demand or where constitutional legislation has been or will be amended to allow foreign freehold ownership of property for example. See more distant from your own backyard for the next property investment and diversify that real estate portfolio for maximum success
Make sure you pay a reasonable price. Always call around some real-estate agent in the area, before buying, a prospective buyer in the area, and ask how many people should expect to pay for this type of property. This can only take an hour but somehow confirm whether it is a good deal, or help you walk away.
Location, location, location - One development probably 20% cheaper than others, why is that? Which will increase the value more? What attractions / amenities are there now / will be there at the time of completion? What might be built around development in the next 2 years while being built - would that look fantastic still be there?
Is mathematics ?
Before you think about looking around properties sit down with pen and paper and write down the cost of rental house you see and you're likely to get. Traditionally buy-to-let lenders want rent to cover 125% of mortgage payments, although some of these relaxing, and interest rates higher. Most are also looking for a deposit of 15%, which protects against falling prices.
Think about your target tenant
Instead of imagining whether you want to live in your investment property, put yourself in the position of your target tenant. Who are they and what do they want? If they are students, it must be easy to clean and comfortable but not luxurious. If they are young professionals it should be modern and stylish but not overbearing. If their families will have plenty of their own property and need a blank canvas.
Know the traps
Before you make an investment you should always investigate the negative and positive aspects. General consensus is that house prices are relatively stable, but they may go down slightly or even further. If that case will you can keep your investment? Even in popular areas properties can sit empty. One of the benchmarks many buy-to-let investors apply is to factor in the property sit vacant for two months this year to provide substantial buffer. Houses are often necessary to improve and things can go wrong. If you do not have enough in the bank to cover major repairs to your property, do not invest.
Consider how hands-on as you want
Buying a property is only the first step. Did you rent it out yourself or get an agent to do so. Agents will charge a management fee, but will deal with any problems and have a good network of plumbers, electrical and other workers if things go wrong. You can make more money by renting a property out yourself but be prepared to give up weekends and evenings on viewings, advertising and repairs. If you choose an agent you do not have to go to High Street presence, many independent agents offer an excellent service and personal. Select your shortlist large and small agent and ask them what they can offer you.
Minimise void periods
Key ways to minimize the void period is to have neutral decor, investing in areas of high demand, finding a new tenant soon after notice given and investment in the property type of interest in the area.
Think long term - unless you bought the property from the plan and intends to flip it for resale and profit before completion you should view real estate investment as long term investment. Real estate is slow to liquidate asset, cash tied up in property is not simple to release. Taking a long-term approach to portfolio of property and assets you give time to increase its value before cashing them for profit.
Consider further the field - there appeared the real estate market property around the world where the nation's economy will be stronger, where the growing tourism sector is pushing the demand or where constitutional legislation has been or will be amended to allow foreign freehold ownership of property for example. See more distant from your own backyard for the next property investment and diversify that real estate portfolio for maximum success
Make sure you pay a reasonable price. Always call around some real-estate agent in the area, before buying, a prospective buyer in the area, and ask how many people should expect to pay for this type of property. This can only take an hour but somehow confirm whether it is a good deal, or help you walk away.
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