Buy To Let property investing can be very profitable but there are risks involved and there is plenty to consider before risking any money. Some people think of this type of investment of being an easy source of income and don't spend enough time looking at the options and risks involved.
The first thing that you need to consider is location. As with any property-buying action, location is key. If you're hoping to sell your property for a profit, then you'll obviously want to make sure that you're buying in an area where your investment is likely to appreciate in value. It would also be wise to do some investigation - are you looking at an area where prospective tenants will be plentiful? If you're looking to rent, for example, to a family then have you thought about whether there are schools and other amenities closeby?
One factor that people can forget is that properties need maintaining. Don't forget that maintenance will largely be your responsibility, rather than that of your tenants. You'll need to consider how much time and money will be involved to keep the property in good order. If you're intending on using an estate agent to help you find prospective tenants, then don't forget that they'll take a percentage of your rental income.
Another issue which needs to be factored into your costs is what happens when the property is empty. If you're looking to buy to let then there will almost certainly be periods when you don't have tenants in the house. During those periods you obviously won't be receiving any rental income. Have you allowed for such periods in your calculations?
Our guide will take you through some of the key issues surrounding buy-to-let:
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An overview of Buy To Let investing
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