Investing in bricks and mortar is potentially lucrative, but never totally risk-free. Timing is critical and, not surprisingly, many investors have been waiting to assess the repercussions of the Brexit vote before plunging into the property market.
Investing in bricks and mortar is potentially lucrative, but never totally risk-free. Timing is critical and, not surprisingly, many investors have been waiting to assess the repercussions of the Brexit vote before plunging into the property market. But now the market has largely settled down, and a sense of panic has dissipated, so what are the key questions to ask before investing in bricks and mortar this autumn.
Doing your homework is vital, as always, so here are our suggested questions you need to ask:
- Is it in an area where growth in house prices can reasonably be expected? Buying in an area where there are major infrastructure improvements in the pipeline – a new mainline station, for example – almost always pays dividends further down the line. Think Olympic effect.
- Is it in an area you know well, close to your home? If you live close to your investment property, you may be able to manage it yourself, rather than relying on others. You will also be better placed to know the true value of the property.
- Does your estate agent have extensive local knowledge? Make sure you use an agent who knows an area and its rental sector in depth and will be able to put you in touch with good local builders, solicitors etc. It often pays to take an architect or builder to a property to give you a quote for any potential work that needs to be carried out. This will save you time and money later.
- What decorative state is the property in? If you are going to give a property a makeover before letting it, you need to factor that in when making your offer.
- Will you be buying with a mortgage? With mortgage rates still so low, this could be a good time to take out a buy-to-let mortgage. But you will need to shop around for the best deals, perhaps through www.moneysupermarket.com.
- How strong is the rental market in the area in which you are buying? It is important to research the local rental market as well as local property prices. If there is a strong and dependable stream of tenants earning reasonable money, then that will make your investment all the sounder.
- What type of tenants are you targeting? Young professionals are usually the best sub-division of Generation Rent to target. But if you are considering student tenants, then make sure the property is close to the college or university campus.
- Is there good residents’ parking? It is the sort of thing that is easy to overlook, but a lack of good residents’ parking can be a big turn-off for some tenants or future buyers.
- Is the property in which you are interested competitively priced? It is a buyers’ market at the moment, so you need to make sure your potential property is realistically priced.
- Are you prepared to be patient? Recognise that, in the present climate, you may need to wait three to five years before your investment property shows a strong return. Don’t expect to make a killing in twelve months, unless you are an extremely canny buyer.
Compromises will be necessary along the way. But the more bases you cover and questions you ask before buying an investment property, the better chance you will have of finding the perfect home.
Are you looking to sell, buy, let or rent?
Contact your local Winkworth office, visit www.winkworth.co.uk/branches.