About Buy to Let

The term buy to let refers to the purchase of a property that will be let to another person or persons. The aim of Buy to Let is that the rent exceeds the monthly mortgage payments. When the income (rent) is greater than the expenditure (mortgage plus other costs), then it is a worthwhile investment. There are number of reasons why people invest in property. Some of these include, long term investment, an alternative to a pension fund and because it tends to offer better rates as opposed to traditional savings. Whatever the reasons, the underlying fact is that the return on investment tends to be highly positive.

Choose A Strategy

In considering buy to let in Basingstoke, it’s wise to choose a strategy. By this we mean do your research and then choose your target market. Some of the main factors to consider in this process are location, target audience and impact of any major economic changes. For example if you choose a location close to major universities, you may consider choosing a strategy of HMO’s. This is because there will be constant demand for single rooms by students. At the same time, there could be many head offices and service companies in that area, so you may choose a strategy for 1 or 2 bed apartments, targeting young professionals. Whichever strategy you choose, look at the needs in that specific location. Get this right and you will minimise void periods and maximise rental income.

Do the Math

With any investment the figures must stack up. Whilst you should bear in mind in your calculation whatever annual income is earned from the property, allow for at least one void month per year. In the buy to let world many landlords and mortgage lenders will consider the yield.

Yield – This is the % of annual profit (rent minus mortgage) divided by the total outlay, (mortgage deposit plus fees). The yield for a worthwhile investment should exceed 7%.

So for example: property costs £100k and you put £20k deposit + £2k fees, total outlay is £22k. If the monthly mortgage is £334 and the monthly rent is £650; monthly income is £316 (annual gross income is £3792);

yield is % of 3792 / 22000 = 17.2%

Most mortgage lenders will lend on the basis that the monthly rental income is at least 125% of the mortgage (interest only) repayments. However, get advice from a mortgage expert, preferably a whole of the market broker. Let us offer you more help and guidance on your buy to let experience.

We can help

Whether you are looking to purchase one buy to let property or have intentions of building up a larger portfolio, we have a team of people who would love to speak with you. We have established long term trusted relationships with key contacts, including mortgage advisers, sourcing agents and experts who can help with strategy. We can provide a complete solution for your entire buy to let requirements.

For further information on investing in properties to rent in the Hampshire area, call Jacobs 01256 465 300.

Book an Appointment or Valuation

You can now book a visit from one of our team through our website. Simply fill out a few details and we will come and visit you.

We will give you an honest appraisal and valuation, discuss your options for selling or renting and run through how we will work the hardest we can to get you the best offer on your current home.

Services for Landlords and Property Owners

If you are looking for a knowledgeable, experienced, modern sales and letting agency who intimately knows
Basingstoke and the region around the town, then choose Jacobs Properties.

With over 20 years of property experience in this area, our team are in the ideal position to help you realise a successful outcome.

For all clients we offer added-value services to help them every step of the way.

Free Property
Valuation

Transparent
Services

HMO Investors
Support

Buy to Let
Mortagage advice

Any Questions: Just Ask!

Whether you want to find out more about Jacobs, arrange an appointment or just discuss your needs, just call during office hours or, if evening or weekend, request a callback at a time that works for you.

By completing this form, you are requesting contact from Jacobs Properties. If you want to know more about how we protect your privacy and personal information, please read our privacy policy.
Opted in If you would also like to receive regular emails with new properties and news in the Basingstoke region, please tick this box.

 

Contact Jacobs Properties

Town Centre Office
First Floor, Winton Square,
Basingstoke
Hampshire RG21 8EN
Oakley Office
22c Oakley Lane
Oakley,
Basingstoke RG23 7JY

Working Hard for you