Skip to content

Over the last couple of months, buy-to-let investments have continued to return solid yields despite the recent changes to the lettings market. In recent articles we’ve offered some advice to potential landlords, suggesting the most suitable types of property for them to purchase and whether or not they should provide furniture for their potential tenants.

In this piece, we’ll offer some tips on how to take the first steps towards becoming a buy-to-let landlord, and taking advantage of the current market’s favourable conditions.

1. Mortgage Matters

The first port of call for any potential buy-to-let landlords should be the mortgage market.

Before you start looking for the right property, you should work out your budget and find out how much you can borrow. The mortgage market is extremely competitive at the moment – which is one of the reasons why buying to let is a favourable investment in this market – so if you shop around you should be able to find a favourable rate.

If you already have a mortgage on the property you’re looking to let out, you’ll still need to speak to your provider. Your lender needs to provide you with “consent to let” before you can move tenants into your property, so you’ll need to speak to them to convert your residential mortgage into a buy-to-let one.

Regardless of whether you need to get a new mortgage or convert an existing one into a buy-to-let mortgage, we can put you in touch with an advisor who can help find you the most suitable deal here.

2. Consider your target market

Once you’ve sorted your mortgage, chosen the perfect property and are ready to go to the market, it’s important to consider who is likely to be interested in your property.

We recommend keeping an eye on market trends, and being prepared to adapt your property accordingly. For example, currently the student lettings market is extremely popular and rental yields from these properties are high, so it may be a good idea to make your property appealing to students, especially if it is near a university. Similarly, being flexible – for example by being prepared to accept a pet or to provide or remove furniture – also ensures that your investment appeals to the widest possible market and increases the chances of letting it quickly.

3. Managed or Unmanaged?

With the recent surge in tenant and landlord legislation, managing your own property may seem like a daunting prospect. Having your property managed by a reputable agent can take a lot of the stress out of letting your property, and ensures that you’ll always be compliant with the latest legislation.

Our Property Management team will conduct periodic inspections of your property throughout every tenancy, handle the deposit, transfer the utility bills into your tenants’ names, and deal with any issues which may arise during the tenancy. We can even provide a rental guarantee service as part of our Premium Property Management service. You can read more about our Property Management service here.

If you still decide to manage your property yourself, you should get as much advice as possible from your agent to ensure that you are compliant with the industry’s changing legislation.

4. Landlord Insurance

When it comes to buy-to-let properties, you will need to make sure that you are covered for every eventuality. Specialist landlord insurance is a must, as is buildings insurance, and if you are marketing your property with furniture included then contents insurance may also be required. Speak to your chosen estate agent about their recommendations in terms of insurers and remember that spending a little on comprehensive cover may save you a lot in the long run.

5. Finances

Once you have your buy-to-let mortgage in place, you’ve decided whether to have your property managed, and tenants have moved in to your fully-insured property, you’ll start receiving regular rental income.

Accordingly, you’ll need to ensure that your taxes are filed correctly. As buy-to-let properties are investments, you’ll need to pay specific taxes regarding the property and the profits you are making. You will be able to offset some of your costs and expenses against these taxes, so it’s a good idea to speak to an accountant to get your finances in order.

If you’d like to take the first steps towards becoming a buy-to-let landlord, you can contact our lettings team for advice here.