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.

According to research by mortgage advisors John Charcol, more than 28% of the UK property market does not know the size or cost of their mortgage rates, whilst a further 50% doesn’t know when their existing mortgage deal is going to end.

And I have to confess that this figure worried me. How can you genuinely not know this information about your mortgage? It is the biggest debt you will ever have. No other will compare… Yet it would appear that many homeowners become clueless to this information once the deal is signed.

What is more alarming for me though is the number of property investors who are probably caught up in these statistics and who are losing out on the best mortgage deals in the industry because they don’t know any better.

The size of your repayments plays a fundamental part in influencing your positive cash flow. The smaller your interest rate, the smaller your monthly repayments will be. And the smaller your monthly repayments are, the bigger your positive cash flow will be after your payments have been deducted.

And it is not like this property information is not available. I regularly receive updates from my lender, roughly once a year, detailing how much I have paid off and what my mortgage deal will default to when my existing deal ends.

But it would seem that many homeowners and even property investors too are dismissing this information…

Now if you are reading this and cannot honestly answer the following, then I thoroughly recommend that you get your property documentation out and refresh yourself. You never know… you might be at a stage in your mortgage where you can switch to a better deal:

• What is the size/cost of your mortgage rate?
• How much do you pay in repayments every month?
• When does your existing mortgage deal end?
• What will your default mortgage rate be?
• What is the term of your mortgage?

Wendy xx

Like homeowners the last thing they want to do is live next to someone who harasses them – they want to live in peace. But the thing is… unlike homeowners who have to sell in order to get away from such neighbours; all your tenant actually has to do is end their tenancy agreement with you.

And let me tell you, this is the last thing you want to happen…

Can Nuisance Neighbours Affect My Profitability?

Surprisingly so… It is easy as a property investor to forget to check out the quality of your neighbours because you are not living in the property yourself.

Yet thinking on this subject I can see how this could quickly impact on your profitability. All you need is one tenant to say to another: ‘I wouldn’t live there the neighbours are horrible’ and it won’t matter how strong the tenancy demand is or how good the rental yields are, if you cannot get tenants to stay, it will be you who is footing the bills.

So what do you do?

You make sure you know exactly who are investing next to before you put down a bid:

1. Visit the property more than once – the average buyer views a property once maybe twice before putting down a bid and usually at the same time of day. To gain an accurate perception of whether your potential property let is actually a local hot spot for vandals and drunks, or if your neighbours are noisy, I suggest trying to view the property at least 5 times and at various times of the day. This will allow you to see exactly what conditions your tenants will be living under.
2. Introduce yourself to your neighbours – meeting someone face to face can tell you a lot about a person. Before you put down a bid, make sure to introduce yourself to your new neighbours. You’ll soon discover if you are going to have difficulties with them over noise or a shared driveway.
3. Know your covenants – if you have already invested in the property and have got tenants living there, make sure to check the covenants of the property to see if your neighbours for example are prohibited from being a nuisance i.e. playing music at certain times of the day, lighting all day bonfires etc…
4. Talk to a solicitor – this should always be a last resort, but should you find that your tenant makes a complaint; you speak/write to the neighbour and they still persist in their actions, then you may wish to speak to a solicitor. They will be able to issue a letter to your neighbour highlighting the properties covenants and the possibility of legal action.

So try to take these on board the next time you invest in property. £500 positive cas flows and a high tenancy demand are all well and good, but get a bad neighbour for your tenants and they may affect your long term profitability.

Wendy xx

I sat down a few years ago with my insurance broker and had a long discussion about the plans for my property portfolio in the event of my death.  Now, I know that no-one really wants to consider their own mortality but one of the best pieces of property investment advice I can give you is to make sure that you have firm plans in place for that eventuality.  Like the Boy Scouts say, ‘be prepared’.

We all have something different we are trying to achieve with our rental property investment.  Whether it is retirement planning, capital growth, income or as an inheritance for our children, we all know what our goals are when we invest in property.  For many, those goals do not end on their own death and so it is vital that there is a will, a strategy and sufficient insurance cover in place for the management of your property (or properties) on your death.

I read a recent survey from The Money Centre that found that a staggering one  in seven landlords did not know what would happen to their properties if they died or become too ill to manage them, whilst a further 40% revealed that they had not bothered to take action in regards to alleviating their families from Inheritance Tax liabilities.

By not protecting their properties properly they are not only putting themselves at financial risk, but also their families.  As a property investor, it is imperative that you review your insurance arrangements.  You may want sufficient cover to repay any borrowing in order that the rental income is provided to your beneficiary.  You might want to leave the properties in trust for your children, or them to be sold and the cash realised for their inheritance.  Do you want your family to face a giant inheritance tax bill?  I know I don’t.

For this reason the Money Centre are advising all UK landlords to seek professional advice to make sure they have a holistic, sensible strategy for their rental property investment.  I can’t agree with them enough.

At a recent conference, property experts Property Frontiers urged property investors to learn all the legal requirements and perform all the necessary legal checks before buying an overseas property.  To achieve this, they recommended making sure the property had a clean land title and ensuring that investors ensure that they will own it in its entirety (rather than ‘part owning’ it).  These are two of the concerns I have always had when considering property investment abroad as I have heard similar horror stories from other buyers.

I have even come across stories of developments that have been stopped completely due to economic problems as well as situations where land has been reclaimed by local authorities for public infrastructure developments.

For me, UK investment property is a much less risky form of investment.  If I am going to invest in property I am generally committing a significant amount of money and so I do not want to gamble that money without being completely sure of the title of the property, that local searches are undertaken and that the development is secure.  I have never felt 100% confident in those areas when considering property investment advice in European countries and further afield.

The UK has a land registry with very strict laws on title and talented, experienced solicitors and conveyancers who can establish proper title and deal with other property issues that may arise.  I also like to research and know the area in which I am buying.  Whilst several fact-finding trips to Spain might seem very appealing, I can never fully know the property and rental market, neighbourhoods and other local issues from this far away.  Decreases in property values can also be much more pronounced overseas.

Knowing the market is the key when you’re looking to invest in property, and with language barriers, different laws, unusual tax regimes and different methods of purchase, property investment abroad is fraught with danger.  Would I buy shares in an overseas company I didn’t know much about?  No – I’d buy them in a UK based company that I could research and who I knew.  The same, I think, should be true for those looking to invest in property.

Property investment advice is crucial to making a success of your property endeavours.  I have learned much of what I know from experts within the industry, from seasoned property investors to specialist lawyers and finance brokers.  They have taught me many things about investing in property and the benefits it offers above other types of investment.

Firstly, property is much less volatile than other forms of investment.  The stock market may offer the potential for sensational returns but it can also be extremely risky.  ‘The value of your investments can go down as well as up’, of course.  Property also has peaks or troughs but over the medium to long term the values of property generally increase and the timescale for such changes is also months and years, not hours and days as with the stock market.

A great piece of property investment advice that I learned early in my property career was that property is a great way to invest using other people’s money rather than your own.  Buy to let mortgages are widely available and, unlike shares where you have to purchase the asset using your own funds, property can be bought using a combination of your money and that which you have borrowed from the bank.  Furthermore, the payments to that loan can be funded by the rental income generated by the property.  It is therefore a terrific way of watching an asset appreciate in value without you having to fund the entire purchase yourself.

The third main benefit of investing in property is that you own a tangible asset.  As it appreciates in value (over the past ten years the UK has seen an average growth of 11.2% per annum) you will obtain more and more equity in the property which can be released.  I am many other investors have been able to build up our portfolios by releasing equity as our existing investment properties have increased in value.

I have picked up many property investing tips over the years and they have helped me hone my property investor skills.  There are many advantages of property as a form of medium to long term investment and by listening to the advice of seasoned property professionals you too can reap these financial benefits.

In my experience, there are three good reasons for attending a property investor show. The first reason I enjoy such shows is that there are a huge range and variety of investment opportunities on offer. Diversification is the key to successful buy to let investment and these shows feature not only UK investment opportunities but also international developments and properties which you may not have previously considered.

Landlord Expert criticised the recent Excel Property Show for being weighted too far in favour of overseas opportunities but the shows I have been to generally strike a good balance between UK and international property.

The major property shows in the likes of London and Manchester also feature a wide programme of property investment advice. I always seek out the seminar programme at these shows as there are often excellent talks and seminars from experienced property professionals designed to support the ‘average’ property investor. I’ve attended talks on tax planning, finance, how to build a portfolio and other property investing topics at the shows I have visited. As well as some interesting exhibits, these property investor shows allow you to benefit from the expertise and advice of some of the leading property entrepreneurs.

The third reason I will make an effort to attend a property investor show is because they are fantastic opportunities to network within the buy to let investment market. The halls are full of both property investors and exhibitors and so it is an excellent opportunity to make professional contacts whether it be for lending or legal advice, developers, property mentors or simply other property investors. I have never come away from a property investor show without a stack of business cards of useful contacts within the property world.

Property investor shows remain popular and there is almost certainly a show in a major venue near you. I’d encourage you to take time out (they are generally held over a weekend) and visit such a show not only to pick up some buy to let investment ideas but also to take advantage of the excellent property investment advice on offer.

As a student landlord specialist, their ultimate goal through this investment scheme is to invest in run down properties situated in desirable student areas, refurnish them and market them out as multiple occupancy homes in just 6 weeks!

Yet the best bit has to be their rental predictions. For a single person rent of £100 a week they are expecting revenues of £5,200 a year. Multiply that by 3 and one house could provide them with a rental income of £15,600 a year.

And they definitely seem to know what they are talking about. They currently have an occupancy rate of 90% to 99%!

So how can we take their successes and translate them into our own investments? Well I know I haven’t got £20m lying around to invest in multiple properties, but the principle I feel is still the same.

By doing the research, investing at 20% below value and ensuring you have got the tenancy to match the rental values, it is possible to make a substantial profit from multiple occupancy. It is just a matter of finding the right locations.

Wendy xx

In the last few weeks, new and exciting mortgage deals have been re-appearing on the lending market, bringing with them the promise of great interest rates, affordable LTV’s and easy accessibility.

Take a look at the following… such deals as these haven’t existed for months!

HSBC: 90% LTV on a 2 yr fixed loan of 4.99%
Yorkshire Bank: 90% LTV 2 yr fixed loan of 5.99%
Post Office: 90% LTV 5 yr fixed loan of 6.01%

And these are just the average mortgages. Banks have also been re-introducing new buy-to-let mortgages, that I have to admit are much more appetising than they have been in recent months.

Yorkshire Bank for example are breaking the 75% LTV norm by offering mortgage loans of 80% LTV – a 5% increase!

This is great news for investors who are currently using their own money to invest in property. With this extra 5%, investors can now more successfully use their property investment strategies all at an affordable price.

Yet this is not all banks are offering to entice individuals back onto the property market. They are also offering incentives to peak your interest.

Halifax for instance is pledging to pay a borrowers Council Tax for a whole year if they choose to take out a mortgage with them, which is not bad when you consider that the average Council Tax is over £1,000 a year.

With such tempting deals appearing on the property market – for homeowners and investors alike – it is impossible to deny that the property market is on the verge of change. It is just a question of taking action fast enough before the property market decides to change again!

Now I know in the past I have discussed the pros of investing abroad, and I do believe that there are profits out there, but when you break each of these markets down into their fundamentals, investing in the UK has many more benefits. Let me explain.

Take the term ‘property investment’. If you were to search for it on the web, you would come across a lot of press stories telling you how profitable investing abroad can be. Their punch line? Falling house prices.

Yet here is the thing. In the UK we are going through the exact same property price falls. It is happening everywhere. So whilst the press may be all doom and gloom about the UK property market, the truth is the whole global economy is feeling the pinch…

The only real discernible difference between them is that when you invest abroad, you do so with greater financial risk.

Their land laws for example, greatly differ from our own in terms of the way they approach and broker their property deals. Their legal fees are different. So as you can see, if you are not careful and do not acquire the right awareness before you invest, you could be setting yourself up for a financial loss should something go wrong.

Then on the other end of the scale, there is the conversion rates between the pound and the Euro.

In normal climates, the pound is generally stronger than the Euro – meaning should you choose to invest abroad you would be getting more value for your money. But in the current financial climate, the scenario is much different – the Euro is stronger meaning if you are not careful you could be investing more money than you think you are.

See what I mean? Whilst investing abroad does have its perks, choosing to invest in the UK can offer you a much quicker returns, plus the security of knowing exactly where you stand law-wise.

Wendy xx