Are New Builds Suitable For Buy To Let Investors?

  • 6 months ago
  • 1

If you are a property investor or landlord, you have a lot of factors to consider when buying to let. Location is crucial, and it is vital to focus on the expected rental yield. You should also consider what sort of tenant you want to let to, but you also need to think about the sort of rental property you offer.

In some locations, and for some tenants, a flat or apartment might be best for their needs. In other area, or for families, a semi-detached or terraced property might be suitable.

Another issue to consider is whether a landlord or investor should buy a new build property as part of their property portfolio.

Whether you are investing in new build or established property, the fundamentals of investing remain the same. The property buyer should be happy with the location, they should understand the rental yield, there should be demand for property, and there should be scope for growth.

Property developers have already researched the market and found people need homes here

One interesting starting point to consider when considering a new build property is that someone should have already researched the market and concluded there is demand for property in this area. If there wasn’t demand for property, developers wouldn’t commit to the project, so this is a positive starting point for analysis of demand for property.

When you are looking at new builds, with an eye to investing – whether they are on the market with estate agents, or off-plan and brought to your attention by a property sourcing agent – you should never lose sight of the fundamental principles of property investment.

Benefits of buying a new build for buy to let purposes

Some of the reasons you should consider investing in a new build property for buy to let purposes include:

  • You can often arrange a discount on the property price, especially if you buy in advance and off-plan
  • All being well, the maintenance work associated with a new build property is lower, saving time and money
  • New build homes should be more energy efficient, helping to lower energy bills, making the property more appealing to tenants
  • New build homes are usually stylish, and appealing to tenants

There are some drawbacks to consider with new build homes. If you buy in advance, or there are delays, you might suffer an elongated period with no rental income. You should carry out research on when the project is likely to be completed, and you must review your finances to determine how long a void period you can manage.

However, if you are comfortable with the financial aspect of investing in a new build property, there is a range of reasons why it is a suitable option for landlords.

If you have any questions or queries about the housing market, it is best to call on experts for support. We are still available to help you, while following social distancing guidelines, so feel free to contact us if you need to. We can arrange a free valuation for you, and if is this of interest, please contact Residential London today.

We have a team of qualified professional property consultants specialising in real estate across the capital. We are active in Westminster, The City of London, Kensington & Chelsea, Hammersmith & Fulham, Wandsworth, Lambeth, Islington, Southwark, Tower Hamlets, Greenwich, Newham, Hackney and many more London locations.

You can call us on +44 (0)20 3733 3817 or email us on info@reslon.co.uk

 

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