Buy to let

·         Buy-to-let is merely a packaged means of investing in rental property;

·         The package offers access with much of the legal and administrative detail offered in the package;

·         It remains important to determine the yields and ask what assurances there are about finding tenants (if any). It is also important to confirm landlord responsibilities;

·         A developer may often offer initial incentives (e.g. tenant or guaranteed return), but these are likely to be temporary and the financial backing may be unclear.

Letting agencies and solicitors are professionals and their job is to relieve you of having to become too concerned with the detail. This is particularly true of the ‘buy-to-let’ market. Furthermore, it is quite likely that a pension scheme administrator will insist on the appointment of an agent, in order to avoid having to deal directly with the day-to-day concerns of tenants.

An outline knowledge of what is involved is relevant, however:

·         It will help you ask the appropriate questions of a letting agent or solicitor;

·         It will help you determine what costs to allow in arriving at a net income yield for the property;

·         It will emphasise how valuable the quality of the tenant is.

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