Is your rental property a B league player, or a star performer? Measuring its performance will help you to decide what to do next: sell it and buy something else, take out equity to buy another – or, at the very least, have peace of mind that the figures do stack up. Doing these sums is a key part of … Read More
Income versus growth in property investment
Besides leverage, the second reason property is a great asset is that it combines two forms of return: long-term capital growth and regular income (rent). Cash gives you income alone (interest); shares can give you capital growth and only sporadic income (dividends). As discussed in our goal exercise, your property goal might mean that you prioritise income or growth, but … Read More
How leverage works in property investment
Why is buy-to-let property such a good thing to invest in? The answer lies in leverage, also called gearing. As the word suggests, it acts like a lever: if you apply a small force (your deposit) to a lever (your mortgage), it amplifies the effect (your return). In a rising market, this catapults what would have been ordinary returns into … Read More
Keep your buy-to-let exit strategy in mind
Your exit strategy forms a key part of your business plan for your rental property. What is your long-term plan with your buy-to-let? Do you want to hold it? Sell it? Return to it? Your answer will steer your decisions. If you’re planning to sell in the next few years, it makes sense to avoid any major upgrades unless they … Read More
Assess your rental property’s competition
Once you’ve analysed your product and your target audience, the next step in creating a business plan for your rental property is to check out the competition. How many properties similar to yours are up for rent nearby? Knowing how unique your property is for the area will help you establish how best to differentiate and market it. For example, in … Read More
Q&A: How can I reduce my buy-to-let tax bill?
Q My husband and I, both in the 40% tax bracket, own our two-bedroom flat in Islington mortgage-free. For commuting reasons, we are about to let it for £1,977 a month and rent in south London for £1,700 a month. We’re confused by all the tax changes for renting. Can we deduct the £200 monthly management fee for the Islington … Read More
Identify your rental property’s target audience
When you draw up your property business plan, think about your target audience. Which type of tenant is your property likely to attract? Who would want to live in this location, with these nearby facilities (for example, transport, schools or parks), in a property of this size, style and layout? It helps to profile your target audience so you can … Read More
How to survive – and thrive – amid the siege on landlords
Section 24, tenant fee bans, Brexit… Landlords feel under siege amid an onslaught of tax and red tape. Is it really that bad? And what can you do to survive and thrive amid all this?
Rents rise 2.2% as market recovers
After months of falling rents, the lettings market has turned a corner — driven by a recovery in London
Q&A: What landlord insurance do I need?
Q I am about to start letting the three-bedroom house that has been my family home. What kind of insurance do I need? Steve White, Manchester A Your standard home insurance is likely to be invalid if you let your property, so check your policy. As a minimum, take out landlord buildings insurance (from about £250 a year), which covers … Read More