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For some people, building up a buy-to-let property portfolio is their way of getting on the fast-track to success. But don’t be under any illusions that it is going to be easy. You will have to invest a great deal of time and money in making a success of things if you are planning to be an active investor. Like any other kind of entrepreneurial enterprise, there will be a high degree of risk involved, but the rewards are there to be reaped if you manage to make a success of things. With this firmly in mind, let’s take a look at the most efficient ways of growing your property portfolio.
Start with a Single Good Investment
Getting off the ground is probably the most challenging part of building a property empire, so you need to make sure that your initial investment is a good one. The best advice that you can follow is to start small. Even if you have the funds to invest in a more expensive property, you will learn a lot of lessons from your first place, so it makes sense that you don’t break the bank. Working with the right can set you off down the right path. It is a good idea to start local so you are able to easily reach your property whenever you choose.
Buy at the Right Time and Price
On a daily basis, residential properties are being sold for less than their market value. You need to make sure that your investment fits in nicely with this criteria. Be bold with your offers. As the old saying goes, if you don’t ask, you don’t get. Try to choose the right time of year to make your investment as the property market goes through cycles. The boom times tend to be in the couple of months leading up to summer and those leading up to Christmas. Avoid these times and you will put yourself in a better position to strike a good deal.
Make Sure to Do Plenty of Research
It may seem crazy, but there are still plenty of first-time investors who head along to an auction, get a sudden rush of blood to the head and buy a property without having done adequate research. Though some will have success, your chances are much smaller if you don’t know what you are getting yourself into. Think about how much work will need to be done to the property and calculate what sort of investment you will need to put in. Analyse the area and who are likely to be your renters. You will put yourself in a much better position if you have done the appropriate research.
Treat Your Tenants Right
You need to make sure your tenants are happy and their experience of renting a property from you is a positive one. Deal with their concerns and any issues that may arise around the property as quickly as possible. Develop this good reputation at the rewards are there to be reaped. Professional tenant management can really help out here.
Neighbourhood
The type of neighbourhood that you go for will very much influence the types of tenants that you get and the regularity that you will find vacancies in your property. For example, if you invest in an area which is dominated by students, it is likely that you will have a large group of possible tenants, but they will not stay for a long period of time. On the other hand, if you choose a family-dominated area, it is likely that they will move with much greater regularity.
Crime Rates
You should be wary about investing in areas which have higher-than-normal crime rates. Not only could this put off potential tenants, you will also find that your property is more likely to get damaged or burgled. It is always worth finding out about crime statistics before investing.
Transport Links
People like to know that they have plenty of options to move around as and when they need to, so you should check out what sort of public transport and road links are available. If your property is within a commutable distance of the local town or city, you are more likely to attract all sorts of workers.
Future Development
As well as the amenities that are available nearby to the property now, it is also worth checking out whether or not there is any future development planned in the future. If there are new apartment blocks, business parks and shopping centres planned, it is usually a sign of a good area for growth. On the flip side, watch out for any developments that could potentially damage property prices in the future.
Rent Prices
It is important that you know what sort of rental prices are available in the local area. Not only will this tell you what sort of return on your investment you can expect to receive, it also tells you how popular the area is. If rent seems high to you but properties are still being snapped up quickly, this is usually a good sign.
Amenities, Schools and Job Opportunities
The three things listed above are right towards the top of the list of what renters are looking for, so it is worth investigating all three in more detail. Find out what sort of amenities and entertainment options are available nearby, as well as the quality of the local schools. Also, check out the prominent employers in the area to help you out when you are profiling potential tenants.
Note: This is a collaborative post
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