Ten 'tight market' buy to let traps to avoid

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  • Ten 'tight market' buy to let traps to avoid

    Here is an interesting list I found on MSN today. Hope it is of some use.

    1. Have a slush fund of cash, in order to prepare for the unexpected, such as a void period in rent or a boiler breaking down.

    2. Avoid being too insular about your potential investments. Networking is a valuable way of gaining priceless guidance from more experienced landlords who have made mistakes that you could learn from.

    3. Beware of buying anything with intensive maintenance issues, where you might lose out on rental income whilst you're renovating or improving the property.

    4. Don't allow your own taste to influence the design and style of the interior or exterior of the property. Personalising a buy-to-let property narrows down your potential market and can be more costly that neutral, safe décor.

    5. Be cautious of buying properties off-plan. You need to stick to a specific timeframe in order to maximise your return and developers cannot always make these guarantees.

    6. Beware of companies offering cheap conveyancing. You will generally get what you pay for, so losing a property due to the conveyancing company not working to your timescale will ultimately not end up being cost effective.

    7. Beware of finishing your buy-to-let property with second-hand furnishings, fixtures and fittings as these may not abide to health and safety regulations that must be adhered to.

    8. Be aware of what insurance you need as a buy-to-let investor. Standard domestic insurance policies do not cover many of the eventualities that landlords face but tailored insurance agreements do exist.

    9. Beware of leaving the management of your property to relatives or friends. Buy-to-let properties need managing carefully in order to maintain tenant occupancy and maximise returns.

    10. Don't abuse the relationship you have with your tenants by giving them little notice before a visit or not addressing maintenance problems quickly. They are an essential part of your business plan and the relationship needs to be managed in a professional way.

    Best wishes,

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