Investing in property has long been considered as one of the best ways of growing your money in the long term, but current market conditions mean that doing it with a high level of efficiency is more important than ever before. How can this be done to make your property investments more likely to succeed?

Using a Letting Agent to Take Day-to-Day Care of the Property

Looking after a single property can take up a lot of time, so any investor who buys several properties is going to find it virtually impossible to take care of them on a day-to-day basis. This is where using a letting agent can pay dividends, as they take care of areas like collecting the rent, looking after legal requirements and searching for suitable new tenants as required.

This can free up more of your time to do other things, and it can mean that property investing can be considered as a part-time activity rather than necessarily being something that requires a full-time commitment. Choose a professional letting agent and you won’t need to worry about carrying out regular inspections or getting hold of tradespeople to carry out any repairs needed at the property.

If you try to do everything on your own, you could find that it gets too much for you. Missing out on a couple of months of rent because you haven’t had time to sort something out could be a disaster for your investment, so paying someone to manage it for you makes sense financially as well as in keeping your stress levels as low as possible.

Using an Experienced Mortgage Advisor

Arranging a mortgage for a rental property can be a time-consuming activity. At the start of 2022, research on the latest data from Companies House was carried out by Hamptons estate agents, and it revealed that there were almost 270,000 buy-to-let companies set up in the UK, with 2021 showing the biggest rise in this number to date. So arranging this type of property loan isn’t as unusual as it once was, but it isn’t something that mortgager advisors tend to see every day either.

Therefore, it makes sense to look for an advisor who has experience in sorting out mortgages for rental properties. This should make the process quicker and slicker, with less risk of the application being shuffled back and forward as new documents are requested or additional requirements come to light. Of course, you should find out about your mortgage possibilities at the start, before getting too far ahead with a property purchase.

Finding Ways to Easily Keep Track of Finances

Keeping a good level of control of your finances is crucial when taking on an investment of this nature. The starting point is to consider the rental yield you could achieve, which is the rental income compared to the cost. At the time of writing, Easy Ayrshire offers the UK’s best rental yield, at close to 8.5%. Next, you could use an online buy-to-let mortgage calculator to work out how much you can comfortably repay each month.

Once the property has been bought and the rental income is coming in, keeping track of the expenses as they arise becomes an important task. You can use the likes of an online invoice management system to keep a close eye on recurring costs such as tradespeople and equipment. A system that’s commonly used to track employee travel expenses can be used for this purpose without any fuss.

Choosing the Right Property

With so many different issues to take into account when choosing a rental property, you need to think carefully about which type of property is going to give you the best chance of investing effectively. For example, if you choose a relatively low-cost property in an area with a high turnover of tenants, you might find yourself looking for new tenants regularly. On the other hand, keeping hold of the same tenants for a long period of time will help you to avoid wasting time and money in this respect.

Another issue to consider is the time and expense that an older property could cause you. If repairs are needed on it regularly, this is going to eat into your profits and cause you problems. Of course, there are pros and cons to buying a new property just as there are when it comes to an older place, so your decision really comes down to assessing the options and then seeing which one you feel most comfortable with.   If you’re planning to carry out repairs, then work out how to do this as efficiently as possible. For example, does it work out better to spend longer doing the work yourself, or does it make more sense to pay someone to do it more quickly so that you can start collecting rent payments to cover the mortgage as soon as possible?
 

Understanding the Latest Tax Rules 

Any changes to the tax rules cause new investors to flood in, or cause a number of existing landlords to move out of the industry. This is because tax law changes can have a huge effect on how effective an investment this is. For example, the 3% stamp duty surcharge imposed on buy-to-let properties in England, Wales and Northern Ireland from 2016 onwards discouraged some people from moving into this type of investment.

Another big change came along in April 2020, when it was announced that private landlords in the UK could no longer deduct their mortgage interest payments from the rental income when calculating their overall tax liability. These changes haven’t made it impossible to make a profit from property development, but it does complicate matters. Setting up a limited company as the owner of the property is one possible solution worth considering.

All of these are areas that anyone looking to buy a property for investment purposes needs to take into account. The more efficiently that you can carry out these things, the greater your chances of making a profit in the long term.