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| Property
Options |
Once
you have decided to invest in property, there
are a number of different routes you can take:
Buy residential property
with the intention of letting it out –
“Buy-to-Let”. This could be a
house or a flat, in good condition or bad,
with or without an existing tenant, with or
without a mortgage. If improvement is required,
you could get the work done then sell for
a profit or keep as a continuing investment.
Buying an existing property
through an estate agent, where the property
is fit for immediate occupation by your tenants,
is the easiest way to invest directly in property.
It will not be the most profitable, but provided
the rent you receive is more than the sum
of your mortgage payments and other outgoings,
it is a perfectly acceptable way to profit
from property in the long term.
Buy
residential property “off plan”,
which means you are committing to buy the
property before it has been built - in other
words, on the basis of the architect’s
plans and drawings. You normally receive a
discount off the open market value, of anything
between 5% and 20%, but as always there are
pitfalls for the unwary.
The
principle is that by buying at a discounted
price,
you already have some extra equity in the
property by the time it is ready for occupation.
Not all investment clubs are equal, however!
It is essential you do your own research to
establish the true market value and a realistic
rental level for any property you are committing
to. |
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