Buy Property to Rent-Out – A Good Investment

“Buy to Let Property” is property buying specifically to let out. Cities like Delhi, Pune, Chennai, Mumbai, Bangalore, etc. and their outskirts are witnessing tremendous increase in the rental values. Due to increase in property price and hike in Home loan interest rates, many people prefer to stay in rental properties. Hence, there are many home owners out there who are taking the advantage of this situation and earning good monthly rental income.

Choosing good location and investigating negative and positive aspects of being a landlord is vital before investing on buy-to-let property. Being a Landlord is not merely collecting rent from tenants, it also has number of responsibilities from choosing a good tenant to providing comfortable living such as maintenance of premises, repairing property or fittings, accepting and returning of security deposits etc.

Tips for Investing on Buy To Let Property

The increasing interest rate on home loans and the doubled capital value of property in plush cities has withheld people from buying property. Many people prefer to stay in rental properties. Property owners who own two or more property are taking the advantage of this situation and earning good monthly rental income. If you are planning to buy a property for renting them, following are useful tips for investing on buy to let property.

• Location is the key: Before investing on the property, research on property location. Homes in high-rent or highly populated areas are ideal. If property belongs to prime location, demand from prospective tenants will be high and people will be ready to pay high rent for the property. Stay away from rural areas and property with less connectivity.

• Type of property: Since not all investment properties are the same, it’s important to determine what type of property fits your strategy. Fully furnished high-end apartments, penthouses, terrace flats, bungalows, villas, luxury apartments, etc. have merged as a popular choice in recent years and are considered a safe investment option. The security offered to such properties by the housing societies has increased their demand among the corporate sectors who wish to rent independent houses for their senior executives.

• Maintenance: Line up maintenance individuals who can take care of the different challenges that occur so you can simply call the person when a particular issue comes up. The more support you have, the better you will be able to handle the problems that come your way.

• Home Loan: Even if you plan to rent out the property, count on paying the mortgage whenever there’s a vacancy. Sit down with a pen and paper and write down the cost of houses you are looking at and the rent you are likely to get. Make sure you know how much the mortgage repayments will be and source of fund available if the property sits empty for a month or two.

• Don’t be over ambitious: Don’t be overly ambitious and build your buy-to-let portfolio surely. Not all properties are rented out easily. Even in prime and popular areas, properties could remain vacant for a few months. Invest for sustainable income and use rental income as a deposit for future investments.

If you own a home in another city but you work or reside in another city, you can enjoy both rental income and HRA benefit than keeping your property vacant. This will earn you rental income, keeping your property livable and you can enjoy HRA benefit for rent you pay. The best and obvious goal associated with acquiring a buy to let rentals are to spend a smaller amount and make more. The easiest way to grow your buy to let property investment portfolio is to work with a company which does all the hard work for you.

In metropolitan cities PG or working women’s hostel is another safe option for rented accommodation. They also offer good business to the owner. Think about your target tenants, their needs and preferences. Young professionals generally like modern and stylish spaces. While tenants living with families generally prefer wide, blank spaces since they have plenty of belongings and very specific needs. Investing in a property near your residence is not always a good idea.