“Size is not always the main consideration, quality and location are more important,” says owner of Belvoir Sheffield Rick Flay.
“Investing in new-build flats, old houses or purpose-built halls of residence and pods all have merit in different ways. It depends on your investment objectives, timeframes and budget.
“Before investing there are numerous things you need to research including – but not limited to – cash amounts, mortgages and rates, fixed costs (such as service charges in flats), potential repairs and improvements, furnishings, gross and net yields, plus likely returns on capital employed.”
“Investing in a university town is good, especially close to the university itself,” says owner of Belvoir Newcastle Central Howard King. “Always make sure that the property has sufficient bathroom and kitchen facilities to match the number of likely occupants.
“Houses seem to be more popular than flats, larger bedrooms are better than singles, good nearby transport links are also useful and double-glazing is becoming a requirement for most tenants.”
“Location of the property is vitally important,” says owner of Belvoir Brighton and Hove Chris Radford. “The main drivers are access to train stations, good shops and restaurants and, in Brighton, close to the seafront.
“The condition of property should also be considered. Tenants want dry, structurally sound properties in good condition (cracked fittings, marked walls, damaged appliances, grubby kitchens and bathrooms are all a turn off).
“Think carefully about the size and layout of the accommodation too. Most tenants will dislike small living spaces, odd shaped rooms and bathrooms without natural light.
“And remember, tenants have a strong sense of rental values so the days of landlords setting the rent to cover their mortgage are gone and they must therefore buy wisely.”
“A BTL property should look good from the outside (kerb appeal). If the inside is immaculate but the outside isn’t, you will struggle to get people through the door,” says owner of Belvoir Lincoln Paul Collins.
“Ideally the property should be semi-detached and have gas central heating and a shower. Double-glazing is another benefit.
“Think about the age of the property. The younger the property, the less maintenance you will have. If you purchase a Victorian property it is likely you will have to rewire the property, therefore I would strongly suggest that BTL landlords have the gas and electric checks done on the property before Exchange of Contracts. If problems are found the cost of rectifying the issues could potentially come off the agreed sale price.
“2 and 3 beds are the most popular (with 2 beds usually giving a better return on an investment), but it is essential that you understand the BTL market and complete all your homework before purchase.
“I would urge all BTL landlords to carry out a cost analysis before committing and have sufficient funds set aside for potential void periods and major repairs (a new boiler could cost around £1500, if you cannot afford to replace it then don’t buy the property).
“If you’re looking to buy in a university city, also look at the student market,” continues Paul. “Student contracts are normally for an 11 months fixed term and rental payments normally come from Student Loans or parents so are fairly secure.
“You are also likely to get more income. For example, a standard 3-bed terrace property (in Lincoln) would normally attract a rent of no more than £600pcm. However, a 4-room student let (i.e. a 3-bed terrace with two reception rooms) would attract a rental income of around £1300pcm. Please note, student lets can involve more work and often do not suit self-managed landlords.”
