Would you buy a BTL property now?
Are you brave enough to consider investing in a new buy-to-let property in the current market?
ough new regulations and tax changes plus the spectre of Brexit uncertainty aren’t doing much for the popularity of the sector with investors. So we’re now seeing a major sell-off, with small landlords quitting the market to the tune of an estimated 4000 properties a month. But if you are a cash buyer – and you can hold your nerve - now may be a good time to buy. And if you don’t have ready money, the Bank of England base rate is at a historic low, so this could be a good time to take out a loan.
There is plenty of demand out there for rental property and house prices are holding up well in most parts of the country. So if you’re willing to buy into the sector for the long term, capital growth still looks strong. So where to start looking? New research looking at the best places to invest in buy-to-let property based on rental yields, shows that Scotland is currently leading the field with rental returns in Glasgow at 7.5%. The next best three places with good returns are in Midlothian (6.8%), East Ayshire (6.8%) and West Dunbartonshire (6.7%). If you are thinking of taking the plunge, it always pays to do your homework
Properties can be managed from Anywhere
The days of landlords needing to be close to their rentals are over, with the advent of PropTech such as our PlanetRent app making it easy to manage your properties remotely; we have connected with partners nationwide to help them manage their properties across the country. This technology frees up investors to search the market for the best returns but once you’ve crunched the numbers don’t forget there are other factors that impact local rental markets. These include any major developments that are planned or new infrastructure in the pipeline, as well as the renter’s profile in that area. If you are looking in an area with a high student population, investing in a house split into flats close to a university will likely offer better returns than a large family home in a high end location. Whether or not your property will hold its value long-term is another question and one that may be tricky to second-guess. That's why it pays to get professional advice from a qualified and reputable property agent.
You should also look for a good mortgage broker – if you need one – and a reliable accountant to ensure your BTL income is as tax efficient as possible. Finally, there are often genuine BTL bargains to be found at auction – but again, research the market – and make sure you fully understand the way this sector operates. Purchasers buying rental property at auction can avoid the long-drawn-out conveyancing process, as properties are sold immediately the hammer falls. But buyers must do their own due diligence. They also need to make financial arrangements in advance. A 10% deposit must be ready for payment when the contracts are signed and they must have access to the remaining 90% within 28 days. Don't forget, there is more to buying property this way than simply turning up and making a bid.
Planetrent Properties
Under Offer: This term applies to a property where the landlord is considering an offer but remains on the market. It implies that further offers may still be considered until the landlord formally accepts or declines the current offer.
Let Agreed: This term indicates that a landlord has provisionally agreed to enter into a rental agreement with a prospective tenant, pending additional checks and referencing. It doesn't require the prospective tenant to have paid a holding deposit.
Let: This term signifies an established binding rental agreement between the landlord and tenant.
For both lettings and sales, the guidance addresses additional terms:
New On The Market: This term is used for a property not advertised since its last sale or rental. It should only be used for a brief period.
New Instruction: It applies to a property assigned to an agent for marketing recently, even if it was previously listed with another agent without being sold or rented.
New and Exclusive: This term refers to a property that is either new on the market or a new instruction, exclusively available through a specific agent or portal.
New Method of Sale/Let: This term is used when a property is being marketed for sale or rent using an alternative approach to the original advertisement, such as transitioning to an auction or sealed bid.
Reduced: This term indicates that a property's price has recently been reduced. The reduction should be genuine and comply with the Chartered Trading Standards Institute's guidelines on pricing practices.