Typical London Buy-To-Let
EIGHT KEY FACTORS WHEN INVESTING IN LONDON
1. When one invests in UK buy-to-let property especially in London, you should first look for value. Always buy at a discount initially or buy off plan for completion in two years or more. The price of the property will be set at current market values so you will get incremental capital growth until you actually take transfer of the property.
2. Stay well clear of existing London properties as your competitor will be the emotional or first-time buyer and you will be up against other non-investor buyers who will push up the price. London property prices are back to the same level as before the crash of 2008.
3. Buy in areas of regeneration. London space is at a premium so keep a look out for new train stations, transport hubs or local councils spending on neighbourhood upgrade schemes. All this indicates good capital growth in the short term.
4. The property must offer lifestyle options that will attract good tenants. Concierge services, in-house gyms, and convenience shops on site all increase rental income.
5. Watch your gross yields. Don't touch anything below 5% gross as you will then need to contribute every month after general expenses like levies and any mortgage bond repayments.
6. Always allow for management and collection fees of around 10% plus VAT. You will be investing long distance and don't want the hassle of day-to-day issues.
7. Invest to hold, not to flip or sell on. A property is a slow wealth creation process so has a 10-15 year outlook in London. You will be investing for hard currency returns in one of the worlds' most vibrant and fastest growing cities.
8. Lastly, verify everything anyone tells you, from rental incomes to regeneration plans.
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