Is Buy-To-Let Investing Dead?

Single buy-to-let properties have fallen out of fashion.

They are the unpopular kids in school. Overshadowed by the mouth-watering returns of other, ‘sexy’ property investment strategies.

The new, popular bunch are:

• Houses of Multiple Occupancy - HMOs,
• Serviced Accommodation - SA,
• Commercial Conversions -CCs,

and other hybrids of the investing strategies.

HMOs promise double-digit yields and a chance to get some of your original investment back out. It’s not all smooth sailing though. A little birdy told me that the lenders are cautious with HMO valuations and tend to downvalue converted properties. Changes to the council tax banding could also see these mouth-watering returns melt quicker than British snow. And cause as much havoc as the inch of snow...

Serviced Accommodation properties are tempting too. Imagine... no tenants! In the current system, it's becoming more and more difficult to evict problematic tenants. Let's not forget the rouge tenants have got all the rights under the sun to their disposal, whilst the landlord’s rights... What landlord rights?!

See what I did there?

Yes, the temptation to invest in SA is real!

CCs can give you the returns of many smaller purchases in one transaction. If you can stomach:

- a higher cost of entry,

- much higher refurb cost (your trusted piggy bank won't be big enough)

- and more complex process

- then commercial conversions might tickle your fancy.

With all these ‘sexy’ investing strategies out there, how can single buy-to-lets compete?

I’m sure you’ll have your own opinion on the subject. But, here’s why we still buy, and we’ll continue buying, these unpopular buy-to-lets in the foreseeable future.

Single buy-to-let properties are the only true ‘set and forget’ investment there is.

If you buy:

- in the area that doesn’t make you press that red, ‘lock’ button on your car dashboard when you stop at the traffic lights

- at a price that makes your profit calculations turn green (note I didn’t say at a price shown at Rightmove or in your estate agents brochure)

- as it’s an ideal marriage. If it’s not till ‘death do us part’ - you at least need to be in for the long run

- and give the management reins to the letting agent who’ll protect your sanity and answer these 1 AM phone calls about boiler breakdowns.

If you tick these IFS - this strategy can deliver from ￡250 to over ￡350 profit per property per month. We’re talking between 7-10% gross yields - not bad. Not bad at all.

Put into the mix the never-growing land with the ever-growing population - add a sprinkle of time and ‘voilà’!

That’s a recipe for long term demand for that very thing you now own.

To cook this recipe to perfection you need some time, local knowledge and property expertise. If you’re a DIY type - then what are you waiting for? Go out there, learn the market and start your journey.

But, if you’re short on time, local knowledge and property expertise - we can help you.

We’re working in Bolton - one of the most exciting investment areas in the UK. We deliver great yields and opportunities for future capital growth that we haven’t seen in the North West before.

Contact me if you’d like to find out more.