Top tips for investing in a property

Tuesday 2nd September 2014

For many buy-to-let looks an attractive income investment in a time of low rates and stock market volatility.

But if you are considering investing in property - or improving your returns on a buy-to-let you already own - it's important to do things right.

Don’t worry about the decorating
A house that hasn’t been decorated for a while has the advantage in the fact that you can see if there are any problems more quickly. Look under the stairs and you can tell pretty quickly if the boiler looks a thousand years old.

Do make a business plan
Renting out a house is a business just like buying a flower shop, for example. You need to be able to put a business plan together and make sure the return on your investment stacks up: that’s not just for the interest, that’s for repayments, too, plus you need to factor in tax payments, repairs and account for vacant periods.

Do be realistic…
About how much you’re actually going to make.

Don’t overdo it
Interestingly, when you’re selling a property it needs to look beautiful but when renting it you can get away with it not looking as beautiful – as long as it’s got lots of space. The same goes for students: they want lots of bedrooms and lots of space but, unless it’s a very top end place in central Edinburgh, York or Leeds, for example, it doesn’t have to be inside a beautiful building.

Don’t do it all yourself
Know when to call in the professionals: plumbing and electrics are two of the biggest costs in a renovation project and although you may be able to do some of it yourself, I honestly think they’re two areas worth investing in. At the very least, I would work with a professional rather than instead of.