If you are looking to build your portfolio from one property to two, three or more, here are our top tips:
Buy-to-let landlords often wonder how they can grow their property portfolios and increase their income in the process. Do they venture into new parts of the country, stretch themselves financially or enter the student buy-to-let market? If you are looking to build your portfolio from one property to two, three or more, here are our top tips:
- Think several moves ahead. You need to map out a financial strategy for expanding your portfolio over a five to ten-year period – when to buy, when to sell, when to borrow – and then be flexible in the light of changes in the property market.
- Don’t try to broaden the geographical range of your portfolio too quickly. You are better off buying a succession of properties in one area, and build up the local knowledge, which will enable you to spot a bargain when it comes on the market.
- Until you have found your feet, it is best to specialise in a particular type of property – say, city apartments or new-builds – than adopt a scatter-gun approach.
- Don’t overstretch yourself financially. You will need to take calculated risks at some stage, but if you assume that interest rates will remain low for ever, and mortgage yourself to the hilt, you may be in for a surprise later.
- Be as hands-on as possible. Think of buy-to-letting as a job, not a hobby. Should you consider a letting agent to take some of the pressure, so you spend more of your time hunting for new properties? It could be money well-spent. Think of your time as an investment.
- Don’t forget the student market, particularly in towns with an expanding student population.
- Always think about your target audience. This will help when it comes to furnishing the flat or house. Young professionals are often a safe bet.
- Period properties can command a premium, so look for the wow-factor in old buildings when searching for your next buy-to-let. If the property does not have it, then think how it can be added quickly to show the house or flat to its best advantage.
- Know your numbers. It can sometimes be better to off-load an underperforming property in your portfolio.
- Keep an eye on factors such as good or new schools and improved transport links, which can boost property values and ensure a buoyant rental market.
- Speak to a mortgage broker to secure the lowest rate and most generous loan size. Winkworth’s preferred mortgage broker is Trinity Financial. http://www.winkworth.co.uk/buyers/mortgages
Keep a clear head, do your homework, and you could be a winner in the world of property.
Are you looking to sell, buy, let or rent?
Contact your local Winkworth office, visit www.winkworth.co.uk/branches