|Buying Property Tips#1: Choose the Right Location|
|Before you choose a location, it is of utmost importance that you consider the development prospect of the area. Other factors to consider here is crime record of the area, availability and nearness of public facilities and utilities.|
|Buying Property Tips#2: Study the Local Market Dynamics|
|It is important to get well familiar with the local realty market. Learn the variation in property prices by street. Don’t shy away from asking a few realty investment agents questions to get better insight on the matter.|
If you're looking for ways to invest your money, then your financial advisor will no doubt have plenty of ideas for you to make the most of every penny. One area they may suggest to you is buying properties to let, and with the number of tenants and the amount of rent they pay on the rise, it can be a great way to get a steady income. However, it's important to think about the effect it'll have on your finances, and here are a few factors you'll need to take into consideration.
If you're not buying a property outright then you'll need to finance it with a mortgage. However, you'll need to look at your terms and conditions beforehand, as some mortgages won't allow you to rent the property. Look for specialist buy to let mortgages which will have the flexibility you need to become a landlord.
It's important to find out what the rules for taxing rental income are in your country, as some countries are more encouraging of investment than others. You'll then be able to work out the net amount you'll receive after agency fees and taxes, and can check that this is enough to cover your mortgage payments and make a profit.
The location of a property is often the first thing a tenant will look at, so getting homes in the most desirable areas is key to ensuring your homes are occupied. Looking for investment property in Chennai and other stylish cities is a good way to ensure plenty of tenants stay interested, and you should look for areas that are up and coming.
|Buying Property Tips#3: Choose the Right Property|
|Getting the right property right away is quite unlikely. First, you need to be clear on why you want to buy an investment property. After that, you will be able to make right decision based on factors like remoteness or accessibility of the property.|
|Buying Property Tips#4: Do the Math Properly|
|Get a precise idea on the value of assets you have available. If you are investing in rental property, make sure you can easily cover the mortgage payment through rents. Additionally, get a clear idea on the appraisal value of the property beforehand.|
|Buying Property Tips#5: Consider Additional Expenses|
|When purchasing an investment property, it is not only the selling price that investors need to consider. There are various additional expenses such as property tax, home owner’s insurance, repair & maintenance that must be considered.|
There are many ways you can research areas that are in demand, including:
- Looking at property sites for average rental prices
- Finding out where new facilities and stores are being built
- Reading articles on news sites
- Looking where young professionals are starting to settle
This will allow you to get the best properties at the best prices, before they start to shoot up, and means you can make the best profit out of the money you've invested.
Many mortgage terms and conditions specify that you need property insurance, and if you're letting a property then there are lots of options for specialist cover. If you're going to let your property through an agent then sometimes their fee will cover certain things, and they will be able to advise on the kinds of insurance landlords need. Don't forget that this varies from country to country, so seek local advice if you're planning to buy abroad as this will ensure that you're protected.
Remember that there are lots of different types of insurance on the market, covering things from the structure of your home to its contents, and some of these policies will be taken out by your tenants. You should be especially sure that you're covered for liability, for example, if one of your tenants has an injury while living in your property. This can save you from expensive lawsuits and lengthy legal battles in the future.
Becoming a landlord can be a great way to make the most of your money, but it's important to get the right advice and to take all legal aspects into consideration before you dive in. Be sure to check the laws in the country you're planning to invest in, and make sure you're covered for the worst case scenario. This will allow you to enjoy the income from your properties without the worries about your cash.
|Buying Property Tips#6: Inspect the Property|
|To ensure that you are getting everything you are paying for, a thorough inspection of the property is essential. Besides ensuring that you are not overpaying, a rigorous property inspection also gives you a good estimation on what the additional expenses might be.|
|Buying Property Tips#7: Pick the Right Financing Option|
|While interests on investment property loans are tax free, some borrowing costs aren’t immediately tax deductible. Knowing that, and structuring your financing in accordance is crucial. Don’t hesitate to ask for help from a financial advisor.|
|Buying Property Tips#8: Invest through Equity|
|One of the best ways to purchase an investment property is to leverage the equity of another property (including your primary home). This is a preferable way among regular investors, especially due to added tax deduction advantages.|