Is Buy to Let a Good Investment?

When you own a rental property you will find that your rental income will increase steadily over the years. If you find the right kind of property you can bring in a 5 to 10% yield, however, this depends on where the house is located, the local rental market, and how good a deal you can get on the property purchase price.

If you get the right mortgage you should have a good return on your investment. While buy to let mortgages are more expensive than owner occupier mortgage loans the rates are usually quite competitive and you may find a good deal.

You should also be aware that investing in buy to let does come with a few risks. This is why it’s crucial you do a lot of research before you consider becoming a landlord.

Higher Deposits

A buy to let mortgage will require you to lay out a higher deposit in advance. Deposits can range from 15% up to 40%. If you can save up a higher deposit you are much more likely to get a great deal on your mortgage.

You should also be aware that mortgages such as these more commonly offered as interest-only mortgages rather than repayment mortgages. What this means is that when the term of the mortgage is up it’s likely you’ll need to sell the property so you can clear the loan.

Alternatively, you could pay the loan off another way, for example, you may wish to continue to let the property out until the loan has been paid off.

Income from your Property

When you apply for a mortgage a lender will look at the potential income that you may receive from a tenant. This will help the lender decide how much money they are going to lend you. You should ideally look to make a profit of at least 125% of your mortgage payments. If you can make a profit such as this you’re likely to be offered a good mortgage.

While purchasing a buy to let property will come with its risks, investing can ensure you have a steady income for many years making it a good option for many investors.

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Slater Forbes are one of the leading property investment companies specialising in off-plan property

20 Years Experience

Please note that Slater Forbes Investments is not authorised or regulated by the Financial Conduct Authority and is not permitted to offer financial or investment advice to UK resident investors, whether or not the intended investments are regulated or unregulated. We strongly encourage all prospective purchasers to consult an FCA-authorised Independent Financial Adviser before committing to any form of investment. This is not an offer to participate in a collective investment scheme as defined in section 235 of the Financial Services and Markets Act (2000) and Investors will not have access to the Financial Services Compensation Scheme or the Financial Ombudsman Service. This website, videos and documents referred are intended to provide general information concerning the proposed development, construction and the management of ”The Development’. The information provided has been prepared in good faith and to give a fair overall view of the Development. Photographs and electronically generated images, furnishings and accessories featured are for illustrative purposes only. All information provided by us at our web site or otherwise is provided on an illustrative basis. This email is for the sole use of potential business partners and/or prospective purchasers. We recommend that all appropriate commercial, tax and legal enquiries and advice is taken before entering into a legally binding contract to purchase a property forming a part of the development. All investments attract a degree of risk and Slater Forbes encourage all clients to undertake their own due diligence. Property prices can fluctuate and the value of your investment may go down as well as up. Prices and financial illustrations are provided as guidance and are examples of the possible discounts, yields and returns that investors could achieve. Copyright in and to this website and documents and videos referred belong to Slater Forbes, which is a trading name of Green Key Sales and Lettings Ltd, which is a UK registered company no 10037602.