Whether you are buying a property as a home or whether you are buying to let the last thing you want to do is make a costly mistake.

There are a number of things that you should consider when you are purchasing a property, some of which are outlined below:

The area

Buying a property in the right area is very important, as the last thing you want to do is end up moving to an area that turns out to be nothing but trouble.

Even if you are buying to let failure to check out the area could result in a drop in the number of potential tenants.

Always find out as much about the area as you can, and if possible pay a visit during the day and at night to get a better idea of what it is like.

Facilities and amenities:

There are some people whose idea of a dream property is somewhere out in the sticks with no other properties or facilities around.

However, if this does not sound like your idea of fun then make sure you check out the facilities and amenities in the area before you make any offers.

Look into nearby facilities such as shops and supermarkets, medical and dental surgeries, schools and colleges – pretty much anything that you feel needs to be pretty close at hand. Again, if you are buying to let the availability and accessibility to local amenities and facilities could affect your success when it comes to letting your property.

Local transport and road links:

If you are going to be travelling to work, college, etc, from your new property you need to ensure that it will be pretty easy to get to where you need to go.

Look into public transport links if you do not drive or have kids that get the bus to school or college.

If you will be driving to work or college look into the road links and motorways so you can determine how long you will be spending on the road.

Employment opportunities:

There are some people that decide to move to another area to start afresh, and this often means finding a new job as well as moving to a new home and area.

If you are planning to start your search for a job once you have settled into your home – or if you are buying to let – look into the potential employment opportunities in and around the area. You may be able to get a better idea by assessing the number of local businesses, retail parks, factories, etc that are in the area.

I was reading an article the other day about property surveys and according to RICS, more than 58% of property owners were under the impression that property valuations also covered a property’s condition (damp and structural movement). Whilst 31% believed the report included advice on legal issues a solicitor should investigate.

And I was shocked…

I don’t know whether it is because I regularly invest in property, or am a cautious person so always opt to pay for a full survey, but the fact that so many property owners make the mistake of only having a property valuation is disturbing.

These types of valuations are only designed to indicate the houses property price, and are used by lenders to determine how much they will lend you. Never do they go as in-depth as to tell you if you need to do repairs.

It is no surprise then – considering these statistics – that 25% of property owners end up having to pay over £1,818 on unplanned building works – they have not been properly prepared.

Something definitely needs to be done to offer property owners more of an education. Too often am I reading nowadays about property owners who have spent thousands more on a property than they planned because they were not properly informed.

But who will teach them? Now that is the real question…

Wendy xx

It is not that there aren’t enough properties in the UK. Quite the opposite…

There are supposedly 500,000 properties lying vacant at the moment as local authorities don’t want to use up funding bringing them up to standard. So straight away if we could access those 500,000 properties we would be able to make a huge dent on this demand.

So what is the problem? Lack of finance…

Even with the right investment strategies property investors still need to be able to access quality buy to let deals to enable us to invest. Yet once again, lenders are ignoring this opportunity and seem reluctant to widen their diversity.

Take this statistic…

During the last quarter 61,000 property owners filled in tenant applications. And their reasoning – because they cannot get a mortgage…

Now I know lenders are scared to find themselves in the same situation they were in during the recession. But they are now impacting on the property market in a different way by making it harder for property investors to buy properties such as the 500,000 listed above and thus reduce this tenant demand!

Sorry… I didn’t mean to go into a rant there, but I think many of you would agree with me that something needs to be done soon to alleviate this pressure, especially as coming benefit cuts will make it even harder for property owners to buy.

There is only so much we can do as a niche to supplement this need before the government needs to act i.e. improve lending, build more properties, give buy to let greater recognition…

Anyways on the upside, there is definitely plenty of demand for property lets at the moment so making a profit from buy to let has never been easier.

Let me know what you think.

Wendy xx

I tend to keep a hold of my property investments and let them out, but over the last year I have felt increasingly sorry for the hundreds of property owners who have been unable to sell because their properties have been overpriced.

Many have been led to believe by their estate agents that their properties are worth more than they are and as a result they have become unwilling to lower their prices.

And it is a shame really, as more realistic property prices would definitely help to improve the fluidity of the property market.

The Idea

According to the article I read, Peter Hendry a member of RICS has suggested modifying the Estate Agent Act so estate agents have to buy any properties they are unable to sell.

And I think his argument is very justified…

Essentially by making it so estate agents have to buy whatever they cannot sell; they will be more realistic in their valuations which in turn will make it easier for property owners to sell and invest in property.

And it is true that if estate agents are being genuine in their valuations (and in the properties ability to sell), they should have no problem taking the property off of the property owners hand. After all, if it can sell at the price they are suggesting, what have they got to lose?

Yet I doubt many estate agents will be happy with this suggestion, especially if it comes into fruitation…

Too many have for too long gotten away with overpricing their properties as it has enabled them to get bigger commissions.

Don’t believe me? Take a look at these real scenarios:

One estate agent is believed to have valued a run down property investment at a higher price than other properties in the area which had recently sold – and all of them were in better condition! Where is the justification in that?

Similarly, there are others pricing properties 50%+ higher than they were 5 years ago even though their condition has diminished, their land is less and the property has been on the market for over a year! It’s silly!

I really do hope this suggestion gets taken seriously and the government acts on it. In the long run, more realistic property prices will provide a better outcome for everyone…

Wendy xx

I am not so sure…

New research by the Council of Mortgage Lenders has revealed that there is 3.57 million mortgages currently outstanding (that are interest only), worth a total of £470 billion.

As a result, the Financial Services Authority is now calling upon lenders to introduce regular checks to make sure that property owners have got a repayment method in place.

But it would seem that the CML are not keen on this idea…

By asking mortgage lenders to perform these checks, they believe interest only deals will soon vanish as lenders won’t want to pay the costs of implementing these checks.

And I have to agree that placing greater regulation on lenders will make them restrict their loans even further! Already thousands of first time buyers, property owners and even property investors, are struggling to get onto the property market because banks are reluctant to lend. Add another regulation and they will go running!

However I also get the FSA’s point that more needs to be done to ensure property owners are able to afford their mortgages, especially when their interest only or existing mortgage deal comes to an end. Interest rates are rising and they are rising fast, so no matter your mortgage type you could end up having to pay more than you can afford!

It is a difficult issue, which I imagine won’t be an easy one to solve, yet I do hope that interest only deals don’t end up disappearing as that would be another hit to the property market which we don’t need.

We will just have to wait and see…

Wendy xx

And you have to admit that this is a dramatic drop by anyone’s standard…

The fact that some firms are managing to let properties within 30 minutes of the property appearing on the market is a testament that demand for property lets is growing, and it is growing fast.

Now, whilst the rest of the market may not be seeing turnovers of 5 days between lettings, there is no disputing that this is a country phenomenon. People want to rent and are willing to bid straight away.

But surely it cannot be this simple?

Yes there may be 5 tenants bidding for every property let, but surely that also means that property investors need to prove themselves more? That competition between property lets is tougher?

After all, tenant standards are rising, so nowadays you need to pull out all the stops when letting a property. You cannot rely on their need making them willing to accept less.

It is definitely something to consider. Hopefully demand will continue to stay high.

Wendy xx

For instance, whilst it is advisable not to buy off-plan if it will take years to complete (and therefore could fall in value); investing in these types of properties can prove beneficial after they are completed.

Let me explain…

The fact is property owners and tenants alike will always want to live in quality housing – property developments which have been built to a high standard.

And luckily for us property investors, property developers are now making more of an effort to meet these standards.

The fact that hundreds of property developers apply for the Building for Life award every year is a testament that they are trying to improving housing quality.

For instance of the 92 who entered this year, 55 new housing schemes qualified for the award – 50% more than last year.

And should property prices continue to remain affordable, these properties could present an appetising opportunity for investors.

Anyways, it is always a good idea to keep a watchful eye on this area of the market. You never know what opportunities will be presented to you on a silver platter.

Wendy xx

Now as property investors we have all had cases of tenants refusing to pay rents, damaging items or leaving our property lets in a mess; however even I have to confess that these incidents really take the biscuit.

You see according to a survey by the Video Inventory Agency tenants will try to get away with anything.

Take these cases for instance:

• One tenant caused structural damage to the property when they installed a dancing pole in the front room, whilst
• Another added an extra storey to the property without informing their landlord or getting planning permission

Okay, okay the dancing pole incident is a little funny, but the reality is many tenants seem to think they can do anything they want to the property without there being consequences.

For instance, how did the tenant who added another storey to the property plan to hide that from their landlord? Plus, how did they think they could get away with not getting planning permission?

It is quite shocking! But these are not the worst of the incidents to be reported. TVIA also revealed the following:

• Tenants secretly moving back into empty property lets
• Tenants growing illegal substances, in one case cannabis, on the premises
• Tenants bribing inventory clerks to not report damages they had done to the property
• Tenants arguing they didn’t need to clean or tidy up after themselves
• Tenants stealing from the property. In one incident a tenant stole a 10 year old cherry tree claiming they had planted it when they had only lived there for 6 months

I have to confess that after reading this story, I plan to be even more vigilant with my property lets especially when using property inventory and tenant guarantor forms. These cases may be rare but they can happen so you need to be careful and take every precaution to protect your property let.

Wendy xx

Now if you are not already aware of the changes, the government has essentially made it possible for more properties to receive an AST classification.

Currently if you have got a tenant who pays more than £25,000 in rent towards their property let a year, you do not have to let the property out as an AST. However as of the 1^st October the government are increasing this threshold to £100,000, meaning thousands of property investments – particularly in London – will suddenly come under an AST status.

And should that happen you will have to take on extra responsibilities in terms of how you handle their deposit i.e. putting their deposit in the Deposit Protection Scheme, informing your tenant of where their deposit is being protected and giving them proof (in 14 days).

Now I know there are probably a lot of landlords out there who are dreading this prospect, but I personally cannot see the problem.

Yes if you have got a lot of property lets that will suddenly come under this banner, then understandably the cost of creating an assured shorthold agreement with them all could prove costly. In addition, you will have to be more pro-active towards their deposits. However, this aside letting your property under an assured tenancy agreement will give you more power and protection.

For instance, if they break a term in their tenancy agreement you will find it easier to regain possession by using a Section 8 or Section 21 and so on and so forth.

Anyways, I thought I would bring this issue to light in case you weren’t aware. Let me know what you think of these new laws…

Wendy xx

Supposedly keeping up with rental payments is their main reason for even considering this. However what disturbed me most about this story was their general attitude towards landlords.

During FinderMonkey.co.uk’s survey they found out that 30% of tenants believed they could avoid experiencing any repercussions from damaging a property let or not paying their final rent as they felt that their landlords didn’t have enough information on them.

Now I don’t know about you, but this story has proven just how important it is to know as much as possible about your tenants before you let them lease your property.

The fact that 1 in 5 tenants considering doing a running, whilst 30% believe they can essentially get away with it is scary.

I for one will definitely be more vigilant with my tenant applications in the future to make sure that my tenants can not only afford to stay in my property let, but that I have plenty of info on them should they try to bunk.

Protecting your property is key, so if you have got access to quality landlord resources: tenant guarantor forms, tenant applications etc, take advantage of them.

Wendy xx