BUY TO LET RESIDENTIAL INVESTMENTS
Let us help you join millions of small investors who have built up a sizable portfolio of buy-to let properties over a matter of a few years. Buy to let has been popular since 1996, growing increasingly more prevalent over time. Buy to let property investment is now considered as one of the most lucrative investment strategies. By purchasing a buy to let property, investors can generate attractive returns and benefit from ownership of a valuable asset in the UK property market.
Identify potential area and specific properties
Buying process at a most effective and competitive rates
Arrange suitable mortgage, bridging etc
Manage your property and help enhance its value
Re-finance when value increases
Basics of Buy to Let Property Investment
Buy to let is a term that refers to purchasing a property for the purpose of letting it out to a tenant, you can either purchase it outright or with a “buy to let” mortgage.
How Does Buy to Let Work?
Buy to let works in three simple steps: The investor purchases the property of their choice, finds a tenant who will agree to pay them regular monthly rental instalments, and then receives a return on their investment through these rental payments.
Over time, those who invest in buy to let can pay off their investment using the money they earn through rental returns. Alternatively, they may decide to re-finance once the value has increased and take out the capital they have invested. At this stage they will make a profit between the rent received and the monthly mortgage payment.
Then, if they hold on to the property and decide to sell it at a later date when valuation reveals an attractive price
What is a Rental Yield?
A rental yield is calculated by taking the yearly rental income generated from a buy to let property and dividing this by the property’s purchase price. It’s important to focus on rental yields that are as high as possible when you look for a buy to let property to invest in, as this figure can mean the difference between a lucrative and attractive long-term investment or a disappointing venture.
Consider Tenant Demand
UK cities have seen a shortage of properties available to meet levels of demand, especially from younger tenants such as students and young professionals. Today’s young people are struggling to buy their own home, which means they’re renting for longer periods. This is good news for buy to let investors as it means that in high-demand areas, they’re likely to generate consistent rental income for many years.
Think About Capital Growth
When you’re looking for the best buy to let areas, remember to factor in the potential for long-term investment capital growth. Areas with a high level of growth are usually those with big regeneration schemes underway. Regeneration is when plans are made to improve a city by redeveloping it, either through transforming current attractions or introducing new ones.
House price growth is perhaps the main factor that puts people off London property is that some areas seeing negative growth, over the years compared to other UK cities. The only area of the capital which seems to have seen growth when it comes to London property prices is North London, with the average selling price having grown by 5.60 per cent in the year to November 2018, exceeding other areas like South and East London.Journey Today
Best Buy to Let Areas in England
Over recent years, the North West region has been deemed the best place to invest in UK. The North west, home to Liverpool and Manchester, was voted one of the best places for buy to let 2019, 2018, 2017, and beyond. Both Liverpool and Manchester are huge hits with students and young professionals, which means there’s always high demand for rental properties. The fact that North West properties are highly affordable means that investors are able to make large savings on their purchase compared to the cost of homes in cities like London.
What will my responsibilities be as a landlord?
Being a landlord comes with certain legal responsibilities. Your tenants must be assured that their right to live in your property is protected by a tenancy contract and that their deposit is in safe hands.
There are several types of tenancy contract, but the most popular is an assured shorthold tenancy (AST). These contracts give tenants a legal right to live in the property for a fixed duration, or on a rolling term.
An AST lasts for a set period, normally six or 12 months. It will detail how much the tenant must pay in rent during that time, who is responsible for repairs, notice of eviction, when rent can be increased, how long the tenancy lasts and the tenant’s right to have their deposit protected.
Deposit protection schemes are a legal requirement and you, or your letting agent, will be fined if you don’t provide one. There are two types of government-backed deposit schemes, insurance and custodial. Since February 2016 landlords have also been responsible for ensuring their tenants have the right to rent in the UK.
Other landlord responsibilities include:
- Making the property safe for tenants to live in
- Dealing with repairs to the property’s structure and exterior
- Maintaining heating and water systems
- Making sure furniture meets fire safety regulations
- Ensuring that the gas and electrics are safe
- Providing your tenant with copies of certain documents
- Buildings insurance
- Landlord liability insurance
Buy-to-let tax implications
You may decide to buy in your personal or joint names. We can help you decide if buying through a Limited Company may be more tax efficient
The rent you receive from your property will be taxed at your relevant tax band (and bear in mind that it could push you into the next band up).
You can deduct some costs against the amount of tax you pay, however. These costs include letting agent fees, buildings and contents insurance, council tax and utility bills (if you pay them on behalf of the tenant) and essential maintenance such as a roof repair or new boiler.
Buy-to-let property is not exempt from CGT. This tax is paid when you come to sell the property on any increase in value – in other words, on your profit. CGT is paid at 18% or 28% depending on your tax bracket.
There is a 3% loading on every stamp duty band for purchasers of additional properties, which includes buy-to-let homes. The tax, which landed on 1 April 2016, applies to all investment property costing over £40,000 – that’s lower than the £125,000 starting threshold for residential homes. The 3% Stamp Duty is also charged on the entire property price, not just the value over a certain tax band.
The tax rules change over time, we will help you understand the rules that currently apply in your personal circumstances
Managing agent and how much will it cost?
Letting agents’ services include anything from sourcing and carrying out credit checks on a potential tenant, drawing up a contract and compiling an inventory, to arranging for a broken boiler to be fixed and chasing up late rent.
There are also mandatory gas safety and energy efficiency checks to be carried out, which an agent can handle for you.
For lettings-only, you might be charged one month’s rent, while ongoing fees to manage the property can start at around 10% of your monthly rental income.
House prices tend to increase over the long term
The housing market fluctuates, average property values are still 34% higher than they were 10 years ago and 212% higher than this time 20 years ago. So long-term, property is a good bet.
There’s unlikely to be a shortage of people looking for decent private rented property in the medium to long term as, unfortunately, Generation Rent – those who will never be able to afford to buy – is growing.
Just 40% of 20-to-39-year-olds living in the capital will own their home by 2025, according to figures from PwC. This compares to 60% in the year 2000
DISCLAIMER: Before going ahead with a buy to let investment, you should always weigh up the benefits against the risks to work out if this is the right venture for you.
MIX USE – RETAILS - RESTAURANT/BAR
Former gala bingo hall kettering With large car park at rear
TO-LET AS WHOLE OR IN PARTS
D1 CHURCH AND EDUCATION CENTRE
SERVICED OFFICES FROM £499 PER MONTH INCLUSIVELARGER UNITS AVAILABLE
MIXED SIZE UNITS TO LETHIGH ROAD EPPING CM16 5HWlarge car parking facilities