Investment opportunities
Buying a property doesn’t have to be about finding your dream home, it can be a great way to build for the future.
Whether you're looking for a buy-to-let or expanding your portfolio, investing in property can be a smart move that sets you up for years to come.
What is the right investment opportunity for you?
What to consider before investing in property
Investing in a buy-to-let property
What's the right investment opportunity for you?
Investing in property isn’t really a one-size-fits-all – it’s about finding the right opportunity to suit your plans for the future. Here are three of the most common ways to invest in property.
Buy-to-let: Buy a property to rent out, providing a potential source of regular income.
Property development: Take on a renovation or rebuild project, adding value to a home before selling it for a profit.
New build homes: Invest in a brand-new property, ready to sell at a premium when the time is right.
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What to consider before investing in property
Investing in property is an exciting step, but there’s a lot to think about. From choosing the right location to understanding costs and long-term potential, it’s important to plan carefully. Here are a few important things to keep in mind before taking the leap.
Know your market and location
Whatever type of property you’re investing in, understanding the market is key. Take time to explore the area, the demand and what makes the location attractive to buyers and tenants.
If you're planning a buy-to-let, look at similar properties to see what’s already available. Knowing average rental prices, competition and what tenants are looking for will help you price it right and present it in the best possible way.
Don’t underestimate the costs
Buying a new home can be more expensive than you think. If you need a mortgage, don’t forget to factor in arrangement fees, stamp duty and all the other costs of buying a new home. It’s important to think beyond the purchase price. Ongoing maintenance, insurance and unexpected repairs – like a new boiler or roof – can all add up. Planning ahead for these costs will help you protect your investment in the long run.
Improve your credit rating
A strong credit rating makes it far easier to secure loans and mortgages when you need them. Reducing your reliance on credit cards and loans is not only good for your cash flow, it could improve your credit record too.
Calculate your yield
As every successful property investor will tell you, your yield, or return on investment, matters. Before buying, it’s worth running a few simple calculations to make sure the numbers add up and your investment works for you. Here’s what to consider:
- Your projected annual rental income
- The property purchase price
- Upfront costs, including deposit and acquisition fees
- Your projected interest charges on any loans or mortgages
- Ongoing expenses like tenant management, maintenance, and administration
- Any taxes you’ll be liable for as part of your investment
Having a clear picture of these costs will help you make more informed decisions and help maximise your investment. There are many great reasons why investing in a new build could be the right choice for you, but it’s important to make sure you go into it with your eyes wide open.
Investing in a buy-to-let property
If you’re thinking about investing in a buy-to-let property, you probably have a few questions. From securing the right mortgage to weighing up the benefits of a new build, we’ve covered some of the key things to know.
Can I get a buy-to-let mortgage on a new build?
Yes, most lenders will offer buy-to-let mortgages for new build properties. However, the criteria can sometimes be a little stricter. You may need a larger deposit and some lenders set limits on the number of new builds they’ll finance.
Are new builds good for buy-to-let?
Yes, new builds can be a great buy-to-let investment. They’re modern, energy-efficient and tend to come with lower maintenance costs, which can be a big plus for landlords. Most tenants love the fresh, contemporary feel of a brand new home, and features like better insulation and lower running costs can make them even more attractive. A new build can save tenants an average of £2,600 in energy bills*. Find out more about why new homes are more energy efficient.
How do buy-to-let mortgages work?
A buy-to-let mortgage is designed for properties you rent out rather than live in. They work a little differently from standard mortgages – lenders usually require a bigger deposit, and repayments are often interest-only, meaning you only pay the interest each month and repay the full loan at the end of the term. The amount you can borrow is also based on the expected rental income rather than just your salary.
Are buy-to-let mortgages more expensive?
They can be. Buy-to-let mortgages usually need a bigger deposit (typically 25% or more) and often have higher interest rates than residential mortgages.
How much deposit is needed to invest in a buy-to-let property?
Most lenders require a deposit of at least 25% of the property’s value for a buy-to-let mortgage, though this can vary depending on the lender and your circumstances. Some may ask for more, especially for new builds or higher-value properties. However, a larger deposit can often help secure better mortgage rates, so it’s worth exploring your options before you buy.
Advice on investing in a new property
If you're thinking about investing in a new property and want to explore your options, we're here to help. Get in touch to chat about your plans and see how we can help you find the right investment for you.
Ready to find your investment property?
If you're ready to start your investment journey, the next step is finding the right property. Let’s find one that not only makes sense now but also feels like a great opportunity for the future.
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