Tenant demand is strong, if not at an all-time high and lets are in short supply in many places as some landlords have decided to exit the market. Unfortuantly this means that Rents are on the rise too, with the average UK rent now touching over £1,000 PCM.
The property market is an ever changing market. It’s true to say that as one door closes another door opens. So now could be a very good time to consider if it is time to get back into buy to let.
Tips for getting back into buy to let
Consider the type of let you want to get into carefully. Target types of lets which offer the highest ROI. For example student, HMO or holiday lets as well as buy to let.
You could use one property as two types of lets, for example; a holiday let during the summer and then a short term let for the rest of the year.
Choose properties and areas carefully. Target places with the best demand. Select properties and areas where demand is not just good but high.
How to Find Great Buy to Let Opportunities in 2022
Don’t just guess. Analyse the numbers behind the deal in detail to make sure the numbers add up.
Take good financial and legal advice. Get advice on the best mortgages. Get advice on whether a limited company would make your business more tax efficient.
Think big. By having several or many properties – if not now then eventually – you benefit from economies of scale in buying and running that single-property landlords don’t benefit from.
Other options you’ll need to be looking at when considering the best buy to let is?
· Finding the best mortgage
· Looking for below market value property
· Looking to add value
· Knowing your market inside out
· Check the EPC before you shortlist a property (Needs to be at least an E rating, however in 2025, this rating cannot be lower than a C ranting)
· Consider buy to let niches
· Consider limited company formation
· Analyse every potential deal in detail
Choose tenants carefully
It goes without saying but choosing the best tenant has always been important, now more than ever. The fast rising cost of living means that even tenants who enter into a tenancy in good faith could struggle to pay the rent over the next few years. It’s essential to ensure that a tenant’s monthly income will cover the rent by a good margin. Ideally it should be at least 2.5x the rent.
It’s also good to note that Section 21 no fault evictions will be going , properly within the next two years, and being replaced by Section 8. This will include a few more grounds on which to evict tenants, you will not be able to evict tenants because you want your property back. This will be something to think about before renting on long term basis.
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