Property is one of the wisest financial investments that anybody can make. If you ever come into a large amount of money, the first thing that a financial advisor will advise you to do is to invest in property.
However, you don’t necessarily have to have a whole lot of cash up front to get involved with making money through property letting. In fact, many individuals working standard jobs have a finger in some sort of property pie. Why? Well, whether you are employed or self-employed, your work is never guaranteed and you can find yourself made redundant or out of work at any given time. Letting out a property provides you with a consistent and reliable means of income no matter what else is going on in your life. When it comes to property letting, you have two main options. The first is purchasing a property to sell it on to another buyer at a higher price. The second, which we will focus on, for now, is to purchase a property and then let it out to a tenant. Here’s everything you need to know when getting started!
Buy-to-let real estate secures you an income on a monthly basis. What you do is take out a mortgage on a property, then fill it with tenants. You should charge the tenants slightly more than the mortgage rate. This means that they are essentially paying off the mortgage on your behalf and providing you with a little extra cash to add to your own pocket on the side. If you bought the property outright, or you have been letting the property for a while and have actually managed to clear the mortgage, you can keep the entire monthly payments as extra income.
Most people turn to estate agents to find tenants for their property. However, they tend to charge a whole lot of money for their services. The truth is that while using an estate agent takes a lot of work and pressure off your shoulders, it also significantly dips into your profits. This is bizarre when you can take on much of the work yourself. You can source your own tenants and conduct your own property inventories yourself. However, we would advise bringing in legal help when it comes to drawing up a tenancy agreement. This will ensure that the agreement is legal and fair for both you and your tenants.
Putting a Price on Your Property
It’s relatively easy to work out how much you should be charging tenants to stay in your property. Simply scour the property market and take a look at how much is being charged for similar properties in your area. If you have extra features or a particularly large property, you can charge a little extra. If your property is a little smaller, or less up to date when it comes to decor, you might want to charge a little less.
As you can see, property letting is an extremely viable way to secure yourself an extra income. Just follow the steps above and everything should be plain sailing!