Lots of people dream of becoming a landlord, as it’s a profitable way of getting onto the property ladder and making a stable, long term investment – after all, the rental market is only going to grow with the rise of the renting generation. With this in mind, here’s a five step guide on how to become a buy-to-let landlord.
1. Understand the buy-to-let market
Before embarking on your landlord journey, take the time to understand the impact of your decision. Consider all of the financial factors, as well as what exactly would be expected of you as a landlord, such as being able to keep up to date with, adhere to, existing legislation.
2. Calculate a budget
Create a budget to better understand the potential cost of purchasing a rental property, as well as how much you could potentially stand to earn in rental income.
3. Find out about compliance and tax regulations
With an increasing amount of legislation imposed upon the private rental sector in recent years, it can be difficult to keep up with all of the changes, especially if you’re a new landlord. A financial advisor may be able to help you understand the full financial impact of your decision when it comes to compliance and tax regulations.
4. Set out an investment plan
Think through all aspects of your investment plan for your rental property portfolio, including rental demand in your area, target demographics, property types, budgets and potential rental yields.
5. Decide how the property will be managed
It might be worth finding an agent to manage your property for you, as this will help you with managing your finances, guide you through the tax regulations and help you create long term investment plans.
This post was contributed by Daniel Cobb, a leading independent estate agents in London. They are a family-run estate agent with 20 years' experience in the London property industry.