Further to last month’s article I am following this with specific local factors to look out for when investing in residential property.
Once you’ve done your homework on the precise area you are targeting and the amount you can invest, these are some golden rules to follow that apply regardless of the type of property or location.
I am referring here to making an investment in the mainstream buy-to-let market and one where you are looking to attract tenants who are in stable, full-time employment. This is the most sensible strategy for smaller, amateur landlords. Specialist niches exist such as letting to students or to those receiving social security, but these as a general rule are best left to full-time professional landlords.
1. Proximity to transport, shops, restaurants
I touched on this in my last article, but I cannot stress the importance of being close to good transport connections and amenities/facilities.
Convenience is the watchword. Tenants are usually young and are predominantly looking for access to shops, cafes/bars/restaurants, gyms and cinemas. An easy walk to a good bus route or train/tube station is a major attraction. You might love living in the middle of nowhere, but your tenants almost certainly won’t!
2. Target gentrifying areas
Is the area you are investing in improving? It’s a very simple question, but a crucial one to focus on. Yes, there are many signs of gentrification to look out for, including the clichéd coffee shop, but fundamentally is the local area on the up? Are more professionals moving to the area? Are the shops being spruced up and new bars, cafes and restaurants appearing?
Talk to people in the area, especially local estate agents and shopkeepers.
The area may currently be run down, but if a new railway or tube station is coming soon, you can be sure new retail and leisure development will soon follow.
It is major investment you are making, so it is also always worth a trip to the local planning office to have a look at the local plan. You will often be able to access a lot of useful information and leads online too.