Buying a building is of course the first and most important step on your property journey. It’s a decision that can have immense consequences, so you need to think carefully about what type of property strategy you’re aiming for before you make any offers.
Narrow down your search before you start looking. The age of your ideal property is an important thing to consider. Is it better to look at new properties or old ones? Here are some pointers to help you make up your mind…
Do you have the funds or time to renovate?
A new property shouldn’t need any work doing to it: perhaps a coat of paint if it’s a few years old, but nothing major. Meanwhile, an older property will have more potential for improvement. Many landlords will buy a property that’s up for sale below market value because it needs a new kitchen, bathroom, or more substantial renovations
‘Doing up’ a property means you can command good rental value from it, and you will make more profit when you come to sell. But it will be a few weeks or months before you can start reaping the value from your investment. Consider whether that would suit you.
Think about maintenance.
A new property should be pretty much maintenance free. You might have the occasional dripping tap or a sticking door, but there shouldn’t be any big issues. An older property, however, can present more significant challenges: a boiler that needs replacing, overgrown trees or bushes that need to be removed, falling roof tiles, rotting windows… It’s very important to consider all these issues and have a thorough survey done before you commit to buy.
What’s the kerb appeal?
A property’s attractiveness is very subjective, so do think about how appealing the property will be to your potential tenants. Many people like a new-build home, but if there are hundreds available, what will make your property stand out? On the other hand, a pretty cottage could appeal to the Instagram generation, commanding better rents and getting snapped up more quickly.
Beware of the unknown
If you’re thinking of buying a house or flat ‘off plan’ – so that you’ll be the first owner of a home that’s still being built – there are further things to consider. Older homes are in established neighbourhoods that have a clear reputation. There’s often a particular ‘type’ of resident: young families, for example, or single professionals.
With a new development, although its marketing team will want to present a certain image, there’s no way of telling whether the completed development will live up to the hype. You might think it will appeal to first time buyers and young professionals, but what if it actually bought up by other landlords and becomes a less appealing development that develops a bad reputation? It might not seem likely, but you could end up needing to sell – and actually lose money on the deal.
Take time to research
The best course of action is to think hard about what you’re seeking to achieve with your rental property. Are you seeking long-term profit growth through rising house prices, or a strong monthly income from the rent?
Do speak to property experts and lettings agencies to get their views on where the trends are in your area and which properties are in the greatest demand. That way you’ll get the best out of your investment, whether it’s new or old.
Our Sourcing & Developments Manager, Adam Seal is a great starting point if you’re looking to buy a property investment. Alternatively, why not sign up to our sourcing mailing list to receive local pre-validated deals? It’s free and takes less than 20 seconds! Just to go our website https://www.progressivelets.co.uk/ and scroll down to the opt-in box at the bottom of our homepage.