This is a conversation I regularly have with new or potential property investors. Don’t get emotionally attached to your buy to let or rental property. Always try to use the head rather than the heart.
I know this is hard to do, lets be honest if the property has been your home at some point it may be impossible, but there is still a benefit in trying.
I recently had a conversation with an investor who was looking to buy in the Dundee area and it could have been a duplicate of similar conversations I’ve had over the years.
We discussed various types of property, location and potential returns. This investor, like many others, assumed that the more he paid for a property the greater his return would be. Unfortunately that just isn’t true, buying wisely is the key. Whilst it is true that a new build, 4 bed detached house in a popular part of town may command a high rent, it will also command a high purchase price so your actual yield may actually be lower, now there could a variety of other reasons you might chose that property, capital growth, schools etc and that’s fine. However, some investors and I hear this way to often, say “well my mortgage is £xxxx therefore I need a rental of £xxxx”. Sorry but the market doesn’t work that way, no one cares (sorry to be blunt), what your mortgage is apart from you and the market rent wont increase because of it, too many investors think they can dictate to the market and usually end up coming a cropper.
The other thing I hear quite a lot of is that the investor or their partner, don’t like an area, street, style of property etc. The advice I give is always the same; your not going to live there, this is an investment. There are a wide variety of factors you should consider before parting with your money but whether you would live in a bungalow or tenement flat isn’t one of them. What will it rent for, potential void periods, scope of maintenance etc these are all real issues that will directly affect your investment, the fact you don’t like the style of taps in the kitchen wont.
A second and similar issue that normally crops up if the landlord is doing some renovation is the amount and type of renovation. Obviously I’m not talking about safety, wind/water proofing or heating type things but the ones where the landlord has a particular taste. An example I had was a landlord who redecorated his rental property, in exactly the same patterned wall paper/carpets that had been in their previously. I had to explain to him that viewers were coming back with comments about the “age” of the decoration. Styles change, I’m not saying you have to be cutting edge but neutral is always a safe bet, you might think that gold plated taps look great but not everyone will. Also it will save you money; clean, tidy and serviceable are the starting points.
They (I’m not sure who) say that you make your profit when you buy a property, not when you sell it, as you are a little more in control of what you pay rather than what you are forced to sell for. With this in mind, why pay the high end retail price for a property just because it looks picture postcard, when what you need is a property that meets all the financial requirements of a landlord first, last and always?
It is to easy, especially for the novice property investor, to fall in love with a property and let their hearts rule their head, and to become so emotionally involved that they lose control of their finances (including in the renovation phase) and let their emotions win. The most important message to convey in all of this is that you MUST buy well in the first place, because if you start the investment processes in the wrong place, the rest of the mathematics that need to be in place to validate this transaction just do not stack up. If a property price is too high, and you just cannot get anywhere negotiating some money off the price, then there is one thing to do and that is WALK AWAY, there will always be another opportunity along soon. 
