What to look for in your first investment property?
If you’re looking for a property that you can afford and will bring you a great return of investment (ROI), you’re not alone many people feel that this area of investment; property is still profitable in the UK economy.
When an investor approaches me to help their business, we discuss the fact that investing into buy-to-let is a rather substantial money commitment which often accounts for thousands of pounds being put into a single property and can sometimes mean taking out a mortgage.
If it is your first buy-to-let, the process of purchase can be very daunting, and it is wise to be fully aware of the advantages and disadvantage of taking on the investment (this is not including project management and expense of a refurb to the property). I will explain in full the meaning of taking on this commitment with potential risks and gains from my perspective.
Thanks to social media and entertainment tv shows we have expectations in how quickly we will be able to turnaround the property and expectation of income, there are just some investments that don’t have that magical unicorn showering it with glitter and sparkle like a fairy godmother to speed up the process in under six months.
And, then there are some investments that can do exactly that….
Just like a great little terrace known as a ‘grunter’ or a ‘two up, two down’.
These little houses are just what I would suggest to anyone looking to get started in property investment. A terrace house is the bread and butter of the property portfolio, and you will be awarded your shiny landlord badge with the lender as quick as that.
Obviously, it’s not going to be the deal of the year but if you’re committed and in it for the long haul many will follow in your footsteps.
Why choose a property like this?
· Not too glamorous.
· Not too pricey.
· No work needed.
· Initial cash to put in is low.
· Cashflow works at approx. £490 pcm (net).
· Great features (fireplace & garden).
· It will never stay empty for long (especially a popular area for families).
· It will have a healthy 9% yield.
· Pass my quality test (would I be happy if my mum lived here).
Average house prices around the local areas in the North of England are up 20% in the last two years, (data collected March 2020) one house actually broke the glass ceiling price for the street by selling for over £100k, with these types of numbers it must surely pique the interest of potential investors looking to buy-to-let.
Seasoned investors seem to overlook this type of property as they don’t add immediate value, but we all need our bread buttered right?