Advice
A simple guide for buy-to-rent investors
30/11/2018 09:53 | Source: buytolet.com
Many people see buy-to-rent as 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-rent you already own - it's important to do things right.

People are turning to property as a form of investment, due to the unpredictability of the stock market and the current low interest rates on savings accounts. If you are thinking of investing in property and then renting it out, this guide sums up the basic information you need to know before you decide to take the plunge.

A simple guide for buy-to-rent investor

1. Making money from buy-to-rent

The main reason people buy property and rent it out is to make money when they eventually sell.

If you bought a property today, you would expect it to increase in value over the coming years and decades. There is no guarantee this will happen, though, so bear in mind there is a chance you could end up with the same amount you paid for the property, or less. Another way it is possible to make money from buy-to-let property is rental income – the rent you charge your tenants should more than cover your monthly mortgage repayments.

2. Finding the right buy-to-rent property

There are many factors to consider when choosing a buy-to-rent property, these include:

- What kind of tenants do you want – a family? A group of students? Young professionals?

- In which areas are there lots of people looking to rent?

- Is demand for rental property in the area likely to increase in the near future? (Are new jobs on the horizon?)

- What type of property do you want to buy? How many bedrooms? With or without a garden? Ready to rent or in need or renovation?

- How close are transport links and certain important amenities?

- What can you afford?

3. Finding the right tenant(s)

You have two basic options: find tenants yourself or use a letting agent. Whichever option you choose, there are a few basic pieces of information you should get from a prospective tenant:

- An employer’s reference

- A reference from their previous landlord

- Proof of identity

- Proof of current addressProof of credit rating

4. Your responsibilities as a landlord

Once your tenants move in, there are a number of things you will be responsible for looking after in the property, including:

- Repairs to the property’s structure and exterior

- Heating and water systems

- Bathroom installations/fittings

- Safety of gas appliances (these need to be checked annually)

- Ensuring electrics are safe

- Ensuring furniture meets fire safety regulations