FACT
FILE - Buy to let in The UK
Buy
to let – Investment Property in the UK
See
also
How
to present your rental property for letting
How
not to present your rental property for letting
Buy
to Let Europe
The
Role of the Solicitor for buying and selling property in England
and Wales
The
annual Buy to Let Guide published November 24, 2008
Buying
a property to let out in the UK is not new. Investors were
purchasing properties throughout the last century. They often
bought a property with a long term tenant in residence, but
this often meant that tents could only be slightly increased
and many people were not prepared to buy property to let out.
The
1980 Housing Act introduced the Protected Shorthold Tenancy
and from that time onwards more and more people have turned
to property letting for additional income.
The
"Buy to Let" market has been growing considerably
in the UK since the mid 1990’s.If you are considering purchasing
a second or third property to let out, consider the following:
It
should be a medium to long term investment
– it is no good purchasing a property on a rising market and
selling it a couple of years later. You might have made good
money on it, but where are you going to get your income from
10-15 years later on?
Decide
upon the area – Will it be where
you live or in a town 200 miles from your home? Contact an
experienced letting agent – They know the market – even in
the area you live in. The agent should be a member of one
of the professional
associations in the UK
– ARLA – NALS- NAEA – RICS etc.
Maintenance
Avoid purchasing a property that
is likely to cost a lot on maintenance. Has it got flat roofs
for example?
Finance
You should calculate rental and
mortgage payments. Take into consideration that there can
be rental void periods during the year, rents can go down
and mortgage rates increase.
Detail
The property should be well equipped
– kitchens – bathrooms to high specification – tenants have
plenty of choice generally in the UK and if your property
is not up to standard they won’t rent it. If you are furnishing
the property don’t consider second hand furniture. The decoration
should be light and neutral colours are best.
- You
should take into consideration the following: Length
of lease, if leasehold Service charge and consents to let
from freeholder - Some freeholders in blocks of apartments
charge for every consent to let and this can be expensive
and although you might be able to offset this against Income
Tax, it could eat into your rental income. Check out the
lease before purchasing. You should also check out the level
of service charges for an apartment. If the property has
a lift you will have to pay an equal share of maintenance,
even if the apartment you are thinking of buying is on the
ground floor.
-
Developments with indoor pools and saunas might appear attractive,
but you might not necessarily achieve a higher rental than
in a comparable that does not have those facilities.
-
Location of property
- Floor
level
- If
you are buying an apartment, try to avoid those that do
not have any owner occupiers living there. When there are
owner occupiers living on site, they tend to contact the
managing agents more regularly if there are problems and
ensure that the development generally is being well maintained.
-
if you are purchasing an apartment Many modern apartments
offer a living room, kitchen, double bedroom with en-suite
shower room, family bathroom and a small single bedroom.
This immediately cuts down the rental potential for two
people sharing who want
nearly equal size bedrooms.
-
Some developments do not provide parking. Even if a tenant
walks or takes public transport to work, from experience
the majority of tenants still have cars that they use for
leisure and food shopping etc.
-
Property type - 4 bedroom property should have at least
two bathrooms etc.
-
Bungalows might not always be such an attractive proposition
as they have often have long gardens and these have to be
maintained. Tenants these days do not generally like gardening,
so you have to provide a garden service.
-
Amount to be spent on the property - New bathroom & Kitchen,
decoration levels
Gardens
Tenants generally do not like gardening.
Think very carefully if you are going to buy a property with
a very long back garden. Who will maintain it? A gardening
service can be expensive, but you should be able to offset
the costs off your tax bill. Consider making the garden easy
to maintain – gravel on the flower borders, good size patios
for barbecues in the summer and if you still have a lawn remember
to leave equipment to maintain it with.
General
Information & Points to note before letting your property:
Buy to let –Investment and Returning owner occupiers
This
information is given for general guidance only and should
therefore not be relied on. It has been prepared by an experienced
letting agent operating in the UK market.
It is essential that your property be presented well for letting.
It should be well decorated, clean and tidy to attract a tenant
who will pay a good rental.
Under
the 1985 Landlord and Tenant Act, Landlords have a legal responsibility
to ensure that Tenants are “safe from harm”. This means ensuring
that Landlords provide housing that is fit for habitation.
A
property available for rent, must be supplied and maintained
to a good standard. Landlords must ensure the structure, hot
water and water supply, lighting heating and ventilation is
maintained throughout the tenancy.
HOW DO I LET MY PROPERTY CLICK
HERE
IVENTORIES
IN THE UK CLICK
HERE
HOUSING
ACT 2004 CLICK
HERE
TENANCY
DEPOSIT PROTECTION SCHEME (TDS) UK CLICK
HERE
Looking
for a Buy to let Mortgage?
________________________________
Looking
for a Landlords Mortgage ? Click on The Money Centre logo
below and get an immediate competitive quote on line.
________________________________
Landlords
are in it for the long-term 
UK
landlords are still committed to buy-to-let in the long-term
despite recent market turbulence, according to independent
research commissioned by The Money Centre. In a survey of
almost 500 landlords, over half said they expect to stay involved
in property letting for more than 10 years: More
information February 2008
________________________________
See
also
Condensation Problems Click
Here
Property
News -
Click
Here
How
to present your rental property for letting
How
not to present your rental property for letting
ARLA’s
Response to the Law Commission Report - August 2008 and
The
Law CommissionHousing: Encouraging Responsible Letting
See
also Energy Performance Certificates
in Let Property - 29
January 2008 Click
Here
Arbitration
- April 2008 - by David Smith - Pain Smith Legal update
Click Here
________________________________
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