247: Financial advice key to successful buy-to-let
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What makes a successful buy to let investor? Mortgage intermediaries will be reassured to find out that sound legal support and financial advice, spotting the properties with the greatest growth potential and bagging a discount are the key requirements.
According to a survey carried out by Heritable Bank amongst 186 buy-to-let property investors who visited the recent Home Buyer Show, some 27% of those interviewed said sound legal support and a reliable financial adviser (26%) as the two most invaluable professional services for property investors.
This was closely followed by managing agents (17%), estate agents (11%), accountants (8%) and architects (6%). The survey suggests that the local council is seen as more of a burden than an ally, with just 2% citing planning or other council departments as invaluable.
Asked which factors mattered most to investors when choosing a property to add to their portfolio, potential price growth of a given area scored highest (72%) followed by snapping up property at a discount (61%) and having strong local market knowledge (39%).
When questioned about their top concerns surrounding their current property investments, property prices were most important with over half (53%) putting this preoccupation at the top of the pile. Other concerns included tenant behaviour (45%), void periods (41%), mortgage costs (34%) and the costs and strains of complying with regulation (32%).
But once you have bought your investment property, you need to know how to maintain it without spending a fortune. Some 35% of investors cited having a good builder as a mate, followed by the much-sought plumber and a solid painter-decorator (both 19%) as the three essentials. Knowing a good electrician was most important for 13% of property investors, followed by a carpenter at 7%.
‘No-one can build a successful portfolio without the right support in key areas, and it’s interesting to see which services property investors depend on most,’ said Mark Sismey-Durrant, chief executive of Heritable Bank.
‘With buy-to-let more popular than ever, property investors are clearly feeling increasing pressure to attract reliable tenants and maintain yields, while keeping one eye firmly on the overall property market.
'However, we feel that while the overall property market may cool through 2007 the market for experienced portfolio property investors should strengthen as a result of increased rental demand and keener purchase prices,’ said Sismey-Durrant.
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