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BUY TO LET AND SECOND HOMES |
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The whole phenomenon of buy to let has been one of the dominant features of the property market for the last 10 years. The numbers of people buying second and third properties purely to rent out to tenants so that they can cover their costs and benefit from the increase in capital value of the property has shown continued growth year on year.
With the fairly steady increase in property prices seen in recent years, this growth has gone on unabated. |
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| The banks and building societies have provided tailor-made financial products for people wanting to follow the buy to let route with a whole range of buy to let mortgages coming onto the market. The main features of these buy to let mortgages (which work on similar principles to normal mortgages) are that they tend to be restricted to a lower percentage of the value of a property and they also attract a slightly higher interest rate. |
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| Buying property to let is not an undertaking that should be entered into lightly. Consideration has to be given to how the bills will be paid during "void periods" when you have no tenants in the property and also the location of the property has a significant impact on the pool of potential tenants that you may have available. |
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| The age and condition of the property is a major consideration as it will drive the likely level of maintenance that will have to be carried out. When the thinking about buying a property to let it is important to make sure you have a good level of "local knowledge" i.e. the types of people looking to let property in the area, whether the rental market locally is generally a "hard" or "soft" market. |
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| One of the quickest and most effective ways to do this is to tap into a local agent, somebody who has got a feel for your target market and the local property market. |
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