If you have decided to invest in a house, then it is important that you make the most of the opportunity. There are lots of things that you can do which will make sure that you get the best from the investment.
Buy or Mortgage?
It is a good idea to start by thinking about whether you are going to buy a property outright or use a mortgage. With a buy to let mortgage, you will need to pay a significant deposit. It might mean that you have a choice of buying a small and cheap property outright or using the money you have towards a deposit on a larger property. There are pros and cons and it is good to have a think. If you buy the property outright then you will have no pressure to have a renter in all of the time as you will not have mortgage payments to make. This means that you will be a bit more relaxed about things. However, if you buy a larger property then you will be able to charge more rent. If you have more money, you may also be able to buy a property in a more desirable location and that could help you to not only be able to find a tenant more easily but to also be able to charge more rent. It is good to research locations and size of properties so that you will be able to make a decision about which might suit you the best.
It is worth thinking about what sort of location you want. Think about the county first. It might be that you want a house that is near to where you live so that it is easy for you to be able to visit it and keep an eye on it. It might be that you want to be in a popular location, near to jobs or perhaps a retirement or holiday location. An advantage of being close by is that you will know the area better and so you will have a better idea of what to expect from house prices, rental prices and things like that. It is worth considering whether you want a home that is near to a school, shops, station etc and whether that might have an impact on how easy it is to rent out and how much rent you will be able to ask for it. It is also good to look at what rental properties are available in the area and how much people charge and how popular they seem to be. Watch the market for a while as that will help you know the information that you will need to make a decision.
It is good to think about the condition of the property as well. If it is in really good condition, it could mean that you will be able to charge more money for it. However, it is also worth remembering that the tenant may expect you to keep it in good condition, so you may need to decorate and do repairs more frequently. However, if it is already good and you are charging based on that, it could be the case the tenants will look after it, although there is no guarantee of this. If the property is not in such good condition, you may want to do it up and make it nicer before you rent it and that could cost you. However, you might be able to keep costs down by doing the work yourself. You may also be able to leave it and charge a bit less rent, but be able to rent it out more easily because it is cheaper to tenants who are happy with a home that is not in such good condition.
What Rental Market?
It is also good to think about what market you are going for. Some people will pick certain types of people they want to rent to. For example, you may want to rent to students and in this case it is likely that you will need a larger house with lots of bedrooms and furniture and appliances in it. You may prefer to rent to families and then you may need to choose somewhere with a garden and quite a few bedrooms. It is good to think about whether you have a specific market in mind as that will determine what you buy and where the best location is.
Agency or not?
It is also good to think about whether you want to use a letting agency or not. There are advantages and disadvantages. The agency will charge you and this means that you will not get such a high income from the property. However, they will also do credit checks and be there to help out the tenant and answer questions, arrange repairs and checks and things like that for you. This means that you will be able to relax a bit and will not need to deal too much with the property. You will even be able to live quite far away as it is unlikely that you will be called upon. However, this will cost quite a bit and so you may rather do this yourself and save the money. It will really depend on whether you have the time to be able to do this and whether you are happy doing this sort of work. You may feel you would rather leave it to experts and pay for it. Letting agents will vary in how much they charge though and so this is something worth considering too, as you could find that you will be able to keep the costs down, depending on which one you decide to use. Of course, they will be dealing with your tenants and advertising your property, so you will want to make sure that you trust them to do a good job.