Saturday, 26 February 2011

Ten tips for buy-to-let | This is Money

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# Home
# Mortgages & homes
# Buy to let
Ten tips for buy-to-let
Simon Lambert, This is Money
Updated:
10 January 2011, 3:53pm
Reader comments (23) |Quiz | Deals | Calculate | Blog

Poor old buy-to-let. Once upon a time it was David Beckham, Wayne Rooney and Kate Moss all rolled into one – making headlines on a daily basis with every move endlessly analysed.

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Bricks and mortar: Find out what you need to know about buy-to-let
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THE BUY-TO-LET-TEST
Question mark It's vital to ensure your property can be a sound investment.
- Buy-to-let test

Buy-to-let is no longer the hot property it once was, and many investors who bought in recent years struggled as mortgage rates rose.

Existing investors should now be benefitting from lower rates, after the base rate was slashed, if they have fallen on to their lender's standard variable rate.

This is especially true for many as a lot of buy-to-let deals do not have typical SVRs but a revert rate that tracks the bank rate.

However, new mortgage deals remain expensive and industry experts acknowledge that now is a tough time for buy-to-let.

But with property prices having fallen to more affordable levels, those who stick to the tried and tested method of investing for rental returns rather than capital growth are tempted.

If investors are willing to accept that the value of their property may slide in the short term, and ensure their property meets the criteria of at least 75% to 85% loan-to-value and returning 125% of monthly mortgage payments then it can continue to be a good long-term investment.

Like any investment, buy-to-let comes with no guarantees, but for those who have more faith in bricks and mortar than stocks and shares here are This is Money's top ten tips:

Read more: http://www.thisismoney.co.uk/buy-to-let-tips#ixzz1F6FDizuH

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