Investing in property is often seen as one of the smartest ways to grow your money. Buying a home to sell on is one of the most popular ways in which to do this, however, with less and less people currently in the market for buying a new home, property investors have moved onto a new way of making a profit – buying homes to let. Buying a home to let can take a significant amount of work when compared to buying homes to sell, however it is also a viable way of making a real passive income that could easily allow you to have an early retirement. If you are considering investing in your first rental property, here are some top tips.
Where to Buy
Choosing a good location when looking for a home to buy for rental purposes is absolutely critical. Just like home buyers, tenants don’t want to live in run-down, dodgy areas – even if you’re able to give them a really cheap monthly fee. Not only that, but bad areas might also attract the type of clients that you don’t want, and result in you losing money on repairs to the property once they leave as they haven’t taken care of it properly. Buying houses in Edmonton and other popular, attractive areas is the first rule of investing in property to let.
To Furnish or Not to Furnish?
Investors who buy homes in order to become a landlord have to face the question of whether or not providing the home fully furnished is a good idea. In some cases, this might work out better – for example if you are planning on letting a property to students – however, it’s good to bear in mind that the majority of professional tenants prefer an unfurnished home to one which comes with furnishings included. This is due to a number of reasons – tenants who provide their own furniture don’t have to worry about costs incurred if they damage it, and they are able to make their own choices regarding the furnishings in their home. Rather than provide a fully furnished property, you might want to consider a part-furnished deal, for example including white goods in the kitchen or certain basic furniture items.
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When first starting out as a landlord, it is highly recommended that you hand over the keys to an experienced property management company. Although you will need to pay a percentage of your earnings from the house to them, it can often be really worth it as you won’t have to deal with situations such as repairs to the home or tenants missing rent payments – the property managers will do it all for you. Property managements companies can also help you to find suitable tenants for your home and will have all the facilities required to screen them beforehand, giving you peace of mind.
Do you have any tips for new landlords looking to buy a house for the rental market? Whether you’re an experienced landlord or a tenant wanting to share your views, we’d love to hear from you in the comments.