Real World Tips For First Time Buy To Let Investors
I started out my career in property investment with one buy-to-let. To prepare myself for this new career, I sought out all the property books I could get my hands on and read them all! Those books were helpful, but they didn’t have the answer to all problems you’d encounter in the field. To supplement the facts you learn from books, here are some real-life tips that you need to survive the world of property investment.
Find A Partner To Handle all the forms
The first form you’ll need to sort out is your mortgage application. Collecting all the requirements and finding the right mortgage for your financial capacity is very challenging.
When I bought my first buy-to-let property, the only experience I had with property was when I bought my home. To say that I was confused at that time is an understatement, that’s why I recommend for you to find an assistant or partner. This person should preferably have some experience on how to buy investment property so he/she can help you on the different forms you have to secure.
A few of these documents you’ll have to be familiar with are: copies of the property’s valuations, official documents from the solicitor telling you what will be included in the sale, copies of existing contracts with utilities providers, land registry forms, and a whole bunch more.
Keep in mind that you may need to partner up with more than just one person, because some requirements might need specialised knowledge from a solicitor, agent etc. Here’s a short video from Rick Otton which I found pretty helpful on how to assemble a team when building a property portfolio
Join A Landlord’s Association
When I was starting out, I thought I had prepared myself enough for this venture because of the countless of books I read. Boy, was I so naïve! I was already hampered with the documentation and all that. But things got harder and harder: negotiating with agents and sellers, marketing your property, finding and screening possible tenants etc.
Things changed when I joined the landlord’s association as the older members of the group had a lot to teach me. Aside from the wealth of knowledge you can get from
experienced members, you can also use the meetings to find out new developments with the local councils and get recommendations for the best agents in town.
Set Aside Money For Maintenance
At first, I thought that expanding my portfolio automatically meant my profits would go up. I was very wrong again. It turns out that the more buy-to-let properties you own, the higher your maintenance costs were, hence almost the entire rental profits I made went to maintaining and fixing the properties.
This cycle went on and on for months until I met an independent carpet retailer who turned out to be a landlord too. He shared with me that it’s better to set a budget for buy-to-let maintenance and that it’s impractical to buy the same furnishings for your house and your investment property! It’s as if the heavens parted when I heard his advice, so I am sharing this with all the newbie investors I meet.