Are Buy-To-Let properties a worthwhile investment?
Buy-to-let properties or mortgages are where you purchase a home with the purpose of renting out the property. As well as purchasing a property, many people with money to invest prefer to rent their properties when purchasing a new home instead of selling them.
This is a great way for people to build a new income, and for many is a way of building their retirement pot or pension.
To answer the question, in our opinion buy-to-let properties are a great way for you to invest your money but only if you do this correctly and ensure that it is financially viable. To ensure your capable of fulfilling mortgage payments and to find out more about whether a buy-to-let property is viable for you we recommend speaking to a financial advisor or a mortgage advisor.
Why purchase a buy-to-let property now?
Since the start of 2014 mortgage rates have slowly been reducing in rates, with a 5 year fixed mortgage dropping from 3.69% to 1.79%. This has significant financial benefits for you if you were to purchase a property now. Based on calculations a £140,000 5 Year fixed term Mortgage paid over 25 years would cost you £175,800 currently compared to £214,500 when interest rates sat at the higher 3.69%.
Since the beginning of the new year, there have been some ground-breaking changes for landlords in regards to their buy to let properties and the acquisition of newer properties through buy to let mortgages.
With rates now being offered via bank lenders as low as 1.4% and deposit values are at their lowest ever, coupled with the stamp duty being suspended on properties valued up to £500,000 this could mean you have drastically reduced costs when moving home, purchasing a new property or changing a property to a buy-to-let mortgage.
Along with this loan to values (LTV) are allowing landlords & buy-to-let properties owners place smaller deposits against mortgages, meaning more people are able to purchase a second home to rent as less deposit is required to be granted a mortgage. Some lenders are now offering up to £5million on buy-to-let mortgages.
How do I manage a buy-to-let property?
That’s a good question and the answer to this depends on your situation, and what you wish to gain from your buy to let property. We have some short answers on our
This package also consists of a guaranteed income scheme for landlords, meaning that you a guaranteed a rental income on your property every month even if your property is empty. As well as this our team will manage all aspects of your property including finding tenants, managing paperwork, conducting regular inspections and dealing with tenant complaints or enquiries.