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Six key location issues to consider before purchasing your buy-to-let property.
Who do you want to attract?
Consider the type of tenants you wish to attract and identify whether there is a demand in the particular area, whether that demand is being met and if there is room for another buy-to-let property. Are you looking for families, students, young professionals, corporate tenants and are they looking for what you have to offer in the location in which your property is situated? Letting agents are an excellent source of information. For example, is a large period property situated in a heavily populated student area close to a university suitable for a professional couple? You may decide that it is or you may determine following your own research that you actually require a new-build flat in the city centre close to the train station.
What type of property are you looking for?
The type of property you purchase will affect the type of tenants you attract so you really do need to be clear as to who you'd like to rent your property out to. Additionally, your budget will determine what you are able to purchase. Whether you opt for a house, flat, bungalow, cottage or studio, make sure it's equipped for your target market. It's also worth bearing in mind the amount of work required to get your property up to scratch before renting it out. For example, older properties may need to be renovated or require extensive maintenance, whereas newer properties may need little work doing to them. Market demand will probably influence your decision. Is it worth purchasing a new flat requiring little maintenance if market forces mean that tenants are looking for older, distinguished properties in the area? You will need to perform a balancing act because if you make the wrong decision your property may be vacant for long periods of time, costing you money.
How do you find your ideal buy-to-let property?
Research, research, research... being a successful landlord ultimately depends on meticulous planning and research from the outset. Visit the local area, talk to estate agents, use the internet, speak to local people and businesses to gain further insight about the area. There is a wealth of information out there which will enable you to find your perfect rental property.
Why is the area suitable?
Proximity to local amenities such as shops, commuter links, schools, universities, parks, restaurants, bars and doctors is an essential consideration. The extent to which they are important to potential tenants will in turn affect the type of tenant you attract. For example, if you're hoping to rent your property to a young family, a property close to a reputable school may be a deciding factor. Alternatively, a single professional may be influenced by access to public transport links, bars and restaurants.
Where is the rental property located?
In addition to considerations such as local amenities, it is essential to think about other location issues. For example, is there any development planned for the area which may impact (positively or negatively) on the market demand, such as a new housing development? Is the property located close to an industrial area where sounds, smells and traffic could impact on potential tenants' decision to rent?
When will your property be empty?
Although there are a number of factors which will affect when your property may be left vacant, the type of tenant you wish to attract will also have a knock on effect. This is an essential consideration before you embark on your buy-to-let venture. For example, if you identify that your target market is university students how will you cover the rental income during the holidays?
By taking the above factors into account when starting out on your buy-to-let journey you'll be better equipped to find your ideal buy-to-let investment.
Related articles:
Attracting and keeping tenants
Legal tips for landlords
Dealing with problem tenants
General landlord information (DIY, Inventories and more..)
Energy-saving tips for landlords and tenants
Financial tips for landlords
Buying a buy-to-let property (auctions, location etc)
Insurance for landlords
Using letting agents
Mortgage information for landlords
The information contained within this article is for general information purposes only, it does not constitute advice. Direct Line for Business endeavours to keep the information up to date and correct but does not make any representation or warranties of any kind about its completeness, accuracy, reliability or suitability. Any reliance you place on the information is strictly at your own risk. Direct Line for Business will not be liable for any direct or indirect loss or damage arising out of or in connection with the use of this information.
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