Welcome to BuyAssociation.co.uk

Buy to let resurgence? - Samuel Wagner, Bidprop.co.uk

Buy to let resurgence?

According to RICS, there has been a resurgence in the buy-to-let market. Property has traditionally been seen as a safe, long-term investment and with rents now on the rise, investors are seeing better returns from property than from the stock market or the bank. However, those who are going back into buy-to-let are experienced landlords who are ready and willing to put down significant deposits to ensure rent more than covers the mortgage.

Buying an investment property through auction may sound tempting as these properties are often keenly priced. Buying through auction requires a lot of preparation, though, so research is vital. Just because the guide price on a property looks relatively cheap or the picture looks nice, it does not mean it is a good investment.

Before you even look online or pick up an auction catalogue, make appointments with lettings agents in your chosen area. Ask them what is in demand, what type of properties let quickly and what does not. What streets are most desirable? What are the most popular blocks of flats and why? Armed with this knowledge, you should now know what sort of property you are looking for.

Read through the details of the property on the auction website or catalogue. If it meets your own criteria, arrange a viewing. Do not just look around – open cupboards, check out the boiler and have a good look at the roof. Will major renovations be required? Are there any maintenance issues? Will you have to upgrade any major appliances? If so, factor these costs into your calculations.

I would then recommend approaching the lettings agents again. Ask if your chosen property would let quickly and if so, what sort of rental return would be realistic. Bear in mind that you may have to furnish the property, as well, which will be an additional cost.

You must also arrange financing well in advance of the auction. You will be required to put down a ten per cent deposit immediately if your bid is successful. You will then have to arrange financing for the remaining sum within 20 to 28 days, depending on the auctioneer. It is vital that you speak to a lender in advance of the auction to ensure you can access financing. Otherwise, you may find yourself unable to complete and financially liable. Most banks and building societies will agree a mortgage in principle, which is also useful as this will let you know how much you can bid.

Armed with this information, you can bid at auction with confidence. If you know your upper limits financially, you will know when to keep on bidding or when to back down. With the right property, finding success as a landlord is certainly a lot easier!

Samuel Wagner

Samuel Wagner is the director of BidProp, a new online property auction website that works with professional sellers to accelerate the sale of residential properties in Greater London.

More pages

Page 1: Buy to let resurgence?

Calculate how much you can earn - rent out your UK holiday home here

Holiday homes to rent - across the UK & Ireland

UK property insurance from intasure - Click here for great deals and up to 40% risk related discount on UK & overseas insurance

All you need for a beautiful bathroom - at affordable prices

Discounted hotel rooms in the UK - click here for Laterooms special offers

Advertise Your English Rental Property simple, effective and affordable marketing online!

UK Investment property from just £34,500 High-quality student rooms in an emerging market with 10% net yield guaranteed