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Buy To Let Property: 12 Actionable Tips

The Ultimate Guide to Buy to Let Investment

Buy to Let Property Guide

Buy to let investment is the most popular property investment strategy, offering fantastic returns through rental income and capital growth.

If you’re interested in buy to let property and would like to learn 12 useful tips to help you succeed, make sure you take a look at our detailed buy to let guide.

Section 1: The Basics of Buy to Let Property Investment

If you’re wondering how to make money from property, look no further than buy to let.

Buy to let investment is one of the most popular and lucrative investment methods out there.

By purchasing a buy to let property, investors can generate attractive returns and benefit from ownership of a valuable asset in the UK property market.

Before getting started with buy to rent, however, there are certain things you need to know about.

For buy to let property investors, there are essential things you should know, like how to get a buy to let mortgage and the duties and fees that come with being a landlord.

There are also tips on how to get the most out of your venture, such as saving on stamp duty tax or boosting your profit by buying properties in high-growth areas.

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Buy to Let Property Guide

 

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If you think you need to brush up on your buy to let property knowledge, take a look at our detailed buy to let guide filled with in-depth buy to let tips and advice to help you get started on your investment journey.

We talk you through the basics of buy to let property investment, compare the pros and cons, offer tips on how to secure the best UK buy to let opportunities, and more.

Whether you’re asking yourself ‘what is buy to let property?’ or ‘is buy to let a good idea for me?’, or you want to explore the best place to buy to let UK cities have to offer, you can find all of this and more in our guide to buying property to rent.

Keep reading to find out more.

1. Understand the Buy to Let Basics

Buy to Let Tip: Read Our Rental Yields Guide to Find Out More

Finding the best buy to let returns is one of the most important buy to let tips.

To learn more about buy to let yields and everything they involve, be sure to check out our rental yield guide.

Here, you’ll find answers to some of the most commonly asked questions about yields, along with tips on how to identify a good yield and where to find the best buy to let yields in the UK.

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Weigh up the Pros and Cons 

After learning more about buy to let property investment, you might be asking yourself – ‘should I buy to let? Is buy to let a good investment for me?’.

As a first-time buyer, buy to let can seem like a lot of hassle, leading you to wonder, ‘is buy to let worth it?’.

There are ways of knowing whether buy to let is the right property venture for you. If you are interested in making an investment but want something more tangible than stocks and shares, property provides a welcome alternative.

However, you also need to understand both the pros and cons of buying buy to let properties before you decide whether you should invest to let.

This is one of the most crucial pieces of buy to let advice, helping you realise whether buying property to rent is the right choice for you.

Investment Types Investment Types

Is It Better to Invest in Rental Property or Stocks? 

As buy to let property investment is considered more low risk while still lucrative, many people believe investing in real estate is better than buying stocks and shares.

What you decide to invest in really depends on your budget, personal goals, and risk level.

Right now, the property market is performing at one of the highest levels in years, making buy to let a fantastic venture to get involved in.

Buy to Let Property Buy to Let Property

Should I Buy to Let? Is Buy to Let a Good Investment? 

Is property a good investment to make? And should you consider buy to let?

Buying a property to rent can be a very lucrative and rewarding investment to make, offering a lot of potential to those who wish to increase their cash flow over time.

While things like possible void periods and market changes could negatively affect your investment for a short period, the benefits of buying a buy to let property far outweigh these risks.

With the proper research and knowledge, you can also minimise any potential risks and boost the likelihood of a profitable venture.

Once you feel confident and prepared for any risks, you should move forward with your buy to let UK investment to take advantage of the opportunities on offer.

Buy to Let Tip: Take Your Time  Buy to Let Tip: Take Your Time 

Buy to Let Tip: Take Your Time 

Investing in buy to let is not something you should rush into. It’s a huge financial transaction that not everyone is ready for.

Spend enough time beforehand weighing up the pros and cons to work out whether you’re ready to invest and make this commitment, feeling fully prepared for any unexpected market changes.

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3. Know How to Recognise Good Opportunities

Research Property Investment Research Property Investment

Buy to Let Tip: Do Further Research on What to Look For 

Did you know we have a whole range of great resources on our website which can help you identify the best buy to let opportunities?

Head over to our buy to let news page for more tips on rental yields, capital growth, and more.

You can also sign up to our mailing list to receive exclusive access to the latest property investment deals, such as below-market prices and assured rental yields.

4. Learn About the Costs Involved

As with any financial venture, it’s crucial to spend time planning out and fully understanding the costs and finance involved with buy to let investments.

Aside from the obvious price of the property itself, whether or not you decide to pay in full or use a buy to let mortgage, there are other costs to know about when investing in buy to let.

Here are some of the most common costs that buy to let investors consider before buying a flat to rent.

While there are no legal obligations to pay to get your buy to let property surveyed, some property investors prefer to do so to ensure they’re buying a buy to let property that’s in good condition and meets their standards.

With buy to let investments through a property company, the most popular type of survey carried out is a snagging survey.

Snagging surveys are designed to check for any issues within a new build home. These will usually only be permitted once the development is completed.

Snagging surveys, or any type of survey, will be carried out by a professional surveyor. Costs for snagging surveys when buying a flat to rent usually range from around £300 to £600.

As part of the buy to let legal conveyancing process, buy to let investors use a solicitor to help them through the investment.

Solicitors will also help investors with legal documents such as contracts and any other legal requirements involved with buying a buy to let property.

The exact cost of these fees will, of course, depend on the solicitor you work with.

Many property companies will already have solicitors that they can recommend to their clients. This is often a good route to take if you want to ensure your solicitor is experienced and trustworthy enough to work with.

On average, buy to let conveyancing fees cost around £850-£1,500.

As previously covered, when investing in buy to let, you’ll be faced with the choice of either managing the property yourself or using a property management company.

Using a property management company certainly comes with many benefits, but it’s also another buy to let cost that investors should consider.

Again, the exact cost will depend on the rental management company you choose, but property management costs are typically 10% to 15% of rental income.

This is another reason why one of the best pieces of buy to let advice is to seek out the highest yields possible.

With higher rental returns, the investor can still make a substantial rental income from their buy to let property even after paying management costs.

As with any property, there are often maintenance costs involved with buy to let.

Anytime something goes wrong within a property, such as a faulty kitchen appliance or a leaking tap, it is the property owner’s job to pay for repair costs.

The only exception to this rule is if you’ve purchased a leasehold property instead of a freehold property, and there is a repair issue involving the building itself.

A lot of buy to let investments, specifically apartments, will have leasehold ownership.

This means that the investor doesn’t own the building itself or the grounds of the property.

While this can minimise some maintenance costs, there is actually another buy to let fee that comes with leasehold ownership, which is the service charge of the property.

This includes things like ground rent and electrical bills for communal areas. The cost of service charges for a leasehold buy to let investment depends on the amount set by the freeholder.

Lastly, when buying to rent, there are taxes that investors must pay.

We’ll cover buy to let taxes in more detail later on in our buy to let guide, but stamp duty land tax is the most common.

The type of tax and the amount investors pay for buy to let investments will vary by country, with England, Scotland, and Wales offering varying tax rules.

Survey Fees

While there are no legal obligations to pay to get your buy to let property surveyed, some property investors prefer to do so to ensure they’re buying a buy to let property that’s in good condition and meets their standards.

With buy to let investments through a property company, the most popular type of survey carried out is a snagging survey.

Snagging surveys are designed to check for any issues within a new build home. These will usually only be permitted once the development is completed.

Snagging surveys, or any type of survey, will be carried out by a professional surveyor. Costs for snagging surveys when buying a flat to rent usually range from around £300 to £600.

Solicitor Fees

As part of the buy to let legal conveyancing process, buy to let investors use a solicitor to help them through the investment.

Solicitors will also help investors with legal documents such as contracts and any other legal requirements involved with buying a buy to let property.

The exact cost of these fees will, of course, depend on the solicitor you work with.

Many property companies will already have solicitors that they can recommend to their clients. This is often a good route to take if you want to ensure your solicitor is experienced and trustworthy enough to work with.

On average, buy to let conveyancing fees cost around £850-£1,500.

Management Costs and Agent Fees

As previously covered, when investing in buy to let, you’ll be faced with the choice of either managing the property yourself or using a property management company.

Using a property management company certainly comes with many benefits, but it’s also another buy to let cost that investors should consider.

Again, the exact cost will depend on the rental management company you choose, but property management costs are typically 10% to 15% of rental income.

This is another reason why one of the best pieces of buy to let advice is to seek out the highest yields possible.

With higher rental returns, the investor can still make a substantial rental income from their buy to let property even after paying management costs.

Maintenance Costs

As with any property, there are often maintenance costs involved with buy to let.

Anytime something goes wrong within a property, such as a faulty kitchen appliance or a leaking tap, it is the property owner’s job to pay for repair costs.

The only exception to this rule is if you’ve purchased a leasehold property instead of a freehold property, and there is a repair issue involving the building itself.

A lot of buy to let investments, specifically apartments, will have leasehold ownership.

This means that the investor doesn’t own the building itself or the grounds of the property.

While this can minimise some maintenance costs, there is actually another buy to let fee that comes with leasehold ownership, which is the service charge of the property.

This includes things like ground rent and electrical bills for communal areas. The cost of service charges for a leasehold buy to let investment depends on the amount set by the freeholder.

Taxes

Lastly, when buying to rent, there are taxes that investors must pay.

We’ll cover buy to let taxes in more detail later on in our buy to let guide, but stamp duty land tax is the most common.

The type of tax and the amount investors pay for buy to let investments will vary by country, with England, Scotland, and Wales offering varying tax rules.

As with any financial venture, it’s crucial to spend time planning out and fully understanding the costs and finance involved with buy to let investments.

Amy Jackson, RWinvest

Buy to Let Tip: Work Out Your Potential Costs

As part of your buy to let strategy and property business plan, spend some time thinking about all of the possible costs involved with your investment.

This way, you’ll know exactly how much you need to budget for your investment and will feel more prepared moving forward.

Talking to a financial advisor could be a good way to make sure you understand each cost in detail and seek out helpful financial buy to let information.

Section 2: Choosing Your Buy to Let Investment

5. Explore the Best Buy to Let Areas

When it comes to the UK investment market, buy to let property investment can be highly successful and rewarding.

That is, however, if you choose the right rental market location.

Researching the best buy to let areas to invest in is one of the most crucial steps in knowing how to build a property portfolio that works.

It’s handy to know about the areas in which property prices are growing, rental yields are high, and overall investment profit potential is strong.

To help you get a better sense of the best areas to invest in buy to let in the UK, this section of our buy to let guide will focus on some of the most popular investment areas in England, Wales, and Scotland.

These areas are where the buy to let property market is currently highest, offering property investments that result in some fantastic returns.

The Best Buy to Let Areas in England

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The Best Buy to Let Areas in Scotland

Several Scottish cities are considered great UK areas for buy-to-let investment.

Glasgow Old Town in sunny weather Glasgow Old Town in sunny weather

High Scottish Rental Yields 

On Totally Money’s latest guide to buy to let areas, Falkirk, Glasgow, and Aberdeen all make the list of the UK’s top 25 postcodes.

The FK3 postcode in Falkirk follows Liverpool in second place due to yields of 9.51%, while Glasgow’s G52 postcode comes third with 8.71% yields.

Aberdeen’s AB11 postcode offers lower but still impressive yields of 7.20%.

Edinburgh Old Town in sunny weather Edinburgh Old Town in sunny weather

Edinburgh is Top For Student Demand 

While Edinburgh didn’t make the list of the top 25 rental yield postcodes, the Scottish capital is undoubtedly a strong contender for buy to let property investment.

This is due to the high levels of demand the area generates from its thriving student scene and young population.

Student numbers in Edinburgh are the second highest in the UK, with around 33,609 students attending the University of Edinburgh alone.

Glasgow - bridge over the river Glasgow - bridge over the river

Strong Growth Expected 

Scotland as a whole is predicted to see some of the best rates of house price growth by 2025.

According to Savills, Scotland can expect growth of 22.8% by 2025 – higher growth than that predicted for London and the South of England.

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The Best Buy to Let Areas in Wales

With some top university cities and affordable housing, Wales is becoming a popular choice for buy to let investors.

Cardiff waterfront in sunny weather Cardiff waterfront in sunny weather

Cardiff Ticks the Buy to Let Boxes 

The Welsh capital, Cardiff, made the Totally Money buy to let yield list thanks to the CF43 postcode’s yields of 7.61%.

Cardiff boasts one of the UK’s largest student populations, along with a strong history of regeneration.

Cardiff Bay, for instance, remains Europe’s largest waterfront development, having completely revitalised derelict docklands back in 1987.

At the beginning of 2020, property prices in Cardiff were reported to have grown more than any other city in Wales, with an increase of 41.2% through the last decade.

Cardiff - aerial view of waterfront and city Cardiff - aerial view of waterfront and city

Strong Capital Growth Expected for Wales 

The latest Savills property price predictions reveal growth of 22.8% by 2025 for Wales house prices.

This means that Wales and Scotland share the same predicted growth rate, both exceeding the UK’s average growth rate of 21.1%.

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Buy to Let Property Guide

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Buy to Let Tip: Use Online Tools to Help you Choose the Best Buy to Let Areas

Did you know that you can use specialist online tools to help you work out the best buy to let areas for UK property?

Go Compare has their very own tool allowing you to compare two UK cities and take note of statistics like average house prices, rental cost growth, average yields, and more.

6. Look at Different Buy to Let Strategies 

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Buy to Let Tip - Know Your Tenant Buy to Let - Know Your Tenant

Buy to Let Tip: Know Your Tenant

Knowing and understanding your tenant is a key element of buy to let investment.

Before you make the final decision on which property type you’re going to target for your investment, one of the biggest buy to let tips is to get to know your tenant a little better.

When you get into the mindset of your potential tenant, you’ll gain a better insight into the features and qualities that they favour in a rental property.

Often, taking time to do this before you find tenants can be the key in how to buy to let successfully.

For instance, imagine your ideal tenant is a young professional couple in Manchester.

Think about their main requirements for their rental. This could include proximity to both their workplaces, good transport links, a modern and stylish design, and amenities such as an on-site gym.

Identifying these things will help you make a more informed and well-rounded buy to let investment.

7. Consider Off Plan Buy to Let

Along with choosing whether you want to purchase a student or residential property, you should also ask yourself – should I invest in buy to let in the form of an off-plan property?

Buy to let property investors often select off plan property as their investment property of choice.

But what is an off plan property, what are the benefits of investing in buy to let in the form of an off plan investment, and what are the alternatives?

An off-plan property is a property that hasn’t been completed yet, meaning it is purchased while ‘off the plan’. The investor will buy an off-plan buy to let property without seeing the finished outcome.

This could mean that the property is still in the planning stages, construction has only just begun, or it may be on the way to completion.

The definition of a new build is in the name – it’s a property that has been newly built within the last couple of years.

New builds are sometimes defined in different ways. Some people class a new build as a property built in the last one or two years, while others consider a property a new build if you or your tenant is the first to live in it.

It’s for this reason that off-plan properties and new builds are often grouped together.

Here are three of the benefits of off plan property as a buy to let purchase.

  • The cost – off plan properties are often listed at below-market value prices.
  • Higher growth potential – Off plan properties will often rise in value before they’re even complete, increasing your capital growth returns.
  • Desirability – renters often favour living in new build homes, leading to increased demand.

If you don’t wish to invest in off plan property, you have the choice to invest in completed new build properties or older properties.

Many investors choose to invest in older properties that require renovation. This is also known as a ‘fixer-upper’ property.

This type of strategy can be profitable if done right due to the lower purchase prices and potential to add value. However, renovating an older property can be time-consuming, costly, and require expertise that not all investors have.

A refurbishment property is a property that has been refurbished and updated. These types of projects are usually pursued by those interested in becoming a property developer.

With buy to let, this usually means period properties that have been renovated and turned into modern apartments.

What is an Off-Plan Property?

An off-plan property is a property that hasn’t been completed yet, meaning it is purchased while ‘off the plan’. The investor will buy an off-plan buy to let property without seeing the finished outcome.

This could mean that the property is still in the planning stages, construction has only just begun, or it may be on the way to completion.

What is a New Build Property?

The definition of a new build is in the name – it’s a property that has been newly built within the last couple of years.

New builds are sometimes defined in different ways. Some people class a new build as a property built in the last one or two years, while others consider a property a new build if you or your tenant is the first to live in it.

It’s for this reason that off-plan properties and new builds are often grouped together.

What Are the Benefits of Buying Off Plan?

Here are three of the benefits of off plan property as a buy to let purchase.

  • The cost – off plan properties are often listed at below-market value prices.
  • Higher growth potential – Off plan properties will often rise in value before they’re even complete, increasing your capital growth returns.
  • Desirability – renters often favour living in new build homes, leading to increased demand.

What Are the Alternatives to Off-Plan Property?

If you don’t wish to invest in off plan property, you have the choice to invest in completed new build properties or older properties.

Many investors choose to invest in older properties that require renovation. This is also known as a ‘fixer-upper’ property.

This type of strategy can be profitable if done right due to the lower purchase prices and potential to add value. However, renovating an older property can be time-consuming, costly, and require expertise that not all investors have.

What is a Refurbishment Property?

A refurbishment property is a property that has been refurbished and updated. These types of projects are usually pursued by those interested in becoming a property developer.

With buy to let, this usually means period properties that have been renovated and turned into modern apartments.

Buy to Let Tip: Weigh up the Benefits of Off-Plan Buy to Let

There are many benefits of off-plan property investment for buy to let, and it’s a good idea to learn more about these before deciding on the type of property you will purchase.

Head over to our off-plan investment guide to find information on both the pros and cons of this type of investment.

Invest From £53,500

Fifty5ive

Flexible Payment Structure

Manchester Prices from £221,050

Returns Available on Request 

Luxury City Centre Apartments

Invest From £35,000

ELEMENT - The Quarter

North West's First Eco-Development

Liverpool Prices from £74,950

8% NET Rental Return

300m Away From New £1bn Royal Hospital

Invest From £70,000

The Summit

Stylish Baltic Triangle Living

Liverpool Prices from £139,950

Assured 7% Rental Yields

15-20% Below Market Value

Choose Between a Hands-On or Hands-Off Investment  Choose Between a Hands-On or Hands-Off Investment 

8. Choose Between a Hands-On or Hands-Off Investment 

When you invest in a buy to let property, you’ll be faced with the choice of either managing the landlord side of the investment yourself or hiring a property management company to help you.

This is definitely something you’ll want to consider as part of your buy to let investment process and can depend on several different factors.

What is a Hands-Off Buy to Let Investment? 

Hands-off property investment is when an investor purchases a buy to let property but doesn’t get involved in the day-to-day management of the property.

This would generally mean that they’ve hired a property management company to carry out these duties for them.

The opposite of this is a hands-on investment, which those interested in how to become a landlord tend to opt for.

With a hands-on buy to let investment, you would be responsible for any landlord duties such as finding tenants, responding to calls and queries, and arranging any repairs or maintenance.

Buy to Let Property Management Buy to Let Property Management

Do I Have to Be a Landlord to Own a Buy to Let Property?

A common misconception about being a buy to let property investor is that you need to be a landlord. Thanks to rental management companies, not everyone who owns a rental property has to become a landlord.

Landlord duties include finding tenants, doing background checks on tenants, responding to issues regarding the property, and managing rental payments.

When you hire a rental property management company to do this for you, you don’t have to get involved with this side of buy to let ownership.

Does Buying Buy to Let Property Through a Company Make it a Hands-Off Investment? 

When you purchase a buy to let property through a company, it’s certainly easier to make a hands off investment, but not compulsory.

If you’re investing in buy to let property through a company, you’ll often be provided with the option to leave your investment in the hands of a trusted management company.

At RWinvest, we work with only the best property management companies to ensure our investors are getting the most out of their venture.

Of course, it isn’t necessary to choose a hands-off investment, as you also have the choice to manage the property yourself if you prefer.

What Are the Benefits of Using a Property Management Company?

Different benefits come with using a property management company.

One of the main advantages is that you’ll have more freedom to maintain your career, travel, or enjoy other commitments without worrying about your rental property.

Another benefit is that you’ll often be met with a higher-quality of tenants due to detailed tenant screening processes carried out by the management company or letting agent.

Higher-quality tenants, such as those who have a steady job and regular income, are more likely to stay on top of rental payments and cause fewer issues within the property, which is beneficial for a buy to let investment.

Buy to Let Tip: Work Out Whether You Have Time for a Hands Off Investment 

If you’re unsure whether you should choose a hands-on or hands-off investment when buying property to let, spend some time thinking about the option that would work best for you.

You should be realistic with this and work out whether you would have the free time needed to successfully manage a hands-on investment.

If you’re still unsure of this, you can always enquire with either our offices or a property management company of your choice and discuss your options.

Section 3: Get Prepared

Information about property investment Information about property investment

Buy to Let Tip: Do Further Reading on Rules and Regulations

It’s important to understand everything expected of you as a buy to let investor, as there could be negative repercussions if you fail to do so.

The National Landlords Association is a great website to look at if you want to read about current buy to let rules and regulations in more detail.

You can also find more information on buy to rent landlord requirements on the gov.uk website or by seeking legal advice.

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10. Explore Buy to Let Mortgages

Many people who invest in the UK buy to let market opt to use a buy to let mortgage to help them with the costs of buying a buy to let property.

While some circumstances don’t allow you to use a buy to let mortgage loan, many investors find a buy to rent mortgage necessary to meet property payments.

Whether you plan on using one or not, buy to let mortgages make up a big part of many people’s investment journey.

Here is some helpful information about buy to let mortgages and what to expect.

A buy to let mortgage is a loan agreement specifically tailored to those purchasing a rental property.

A buy to let mortgage in the UK works in a similar way to a regular residential mortgage. These mortgages are offered by most major banks and mortgage lenders in the UK.

Apart from the property type, the main difference is that the buy to let mortgage rate and the interest rate you pay tends to be higher.

Buy to let mortgage deposits usually need to be a minimum of 25% of the property value, but this can vary between 20 to 40% depending on the individual mortgage.

For example, if your property value was £120,000, you’d need to pay a deposit of at least £30,000 as the cheapest buy to let mortgage deposit.

The higher the buy to let mortgage deposit you can offer, the better. This will make it easier for you to find a mortgage lender while also lowering the cost of your repayments.

The amount of money you can borrow for a buy to let mortgage is dependent on the amount of rental income you expect to receive from your investment.

Mortgage lenders will typically need an investor’s rental income to be around 25 to 30% higher than mortgage payments.

To find out how much rental income you can expect from your buy to let property investment, either ask the property investment company you’re buying from, or look at the rental cost of similar properties in the same area.

There is technically no limit to the number of buy to let mortgages an investor can have.

However, certain mortgage lenders will usually limit the number of different mortgages you can have with them. At the same time, some lenders will also limit the number of mortgages an investor can have with other lenders.

To obtain a buy to let mortgage, you’ll need to apply for one with a mortgage lender.

Most large banks offer buy to let mortgages, along with some specialist lenders. Before applying for a buy to let mortgage, it’s a good idea to speak to a mortgage broker who can help you find the most suitable deal.

There is usually certain buy to let mortgage rules and criteria that you need to meet. To obtain a buy to let mortgage, the following rules will need to apply:

  • You should already own your own home.
  • You should have a good credit score.
  • You should earn over £25,000 a year.
  • You must be no older than 70-75 when the mortgage ends. For example, you may struggle to find a buy to let mortgage lender who will agree to a 25-year mortgage if you’re currently 52 as you would be 77 when the mortgage ends.

You can get a buy to let mortgage on most houses or apartments purchased to let out to tenants.

However, certain property types, such as off-plan properties, are difficult to buy with a buy-to-let mortgage.

Those who want to obtain a mortgage for a rental property could struggle to do so with off-plan investments.

Because mortgage lenders will typically only guarantee the amount they’re going to lend for up to six months, they’re unlikely to agree to fund an off-plan investment if the development doesn’t complete within this time.

If you don’t want to use a buy-to-let mortgage when buying to rent, you can always pay off your property investment fees in full.

If you have the money to do so, this may be the easier option, as you won’t have to worry about keeping up with mortgage repayments and possible rising mortgage rates further down the line.

Many property companies and developers will also allow a property to be paid for in instalments, which is a good option if you don’t have the full sum of money right away.

What Is a Buy to Let Mortgage?

A buy to let mortgage is a loan agreement specifically tailored to those purchasing a rental property.

A buy to let mortgage in the UK works in a similar way to a regular residential mortgage. These mortgages are offered by most major banks and mortgage lenders in the UK.

Apart from the property type, the main difference is that the buy to let mortgage rate and the interest rate you pay tends to be higher.

How Much Mortgage Deposit Is Needed When Buying a Buy to Let Property?

Buy to let mortgage deposits usually need to be a minimum of 25% of the property value, but this can vary between 20 to 40% depending on the individual mortgage.

For example, if your property value was £120,000, you’d need to pay a deposit of at least £30,000 as the cheapest buy to let mortgage deposit.

The higher the buy to let mortgage deposit you can offer, the better. This will make it easier for you to find a mortgage lender while also lowering the cost of your repayments.

How Much Can I Borrow on a Buy to Let Mortgage?

The amount of money you can borrow for a buy to let mortgage is dependent on the amount of rental income you expect to receive from your investment.

Mortgage lenders will typically need an investor’s rental income to be around 25 to 30% higher than mortgage payments.

To find out how much rental income you can expect from your buy to let property investment, either ask the property investment company you’re buying from, or look at the rental cost of similar properties in the same area.

How Many Buy to Let Mortgages Can you Have?

There is technically no limit to the number of buy to let mortgages an investor can have.

However, certain mortgage lenders will usually limit the number of different mortgages you can have with them. At the same time, some lenders will also limit the number of mortgages an investor can have with other lenders.

How Do I Get a Buy to Let Mortgage?

To obtain a buy to let mortgage, you’ll need to apply for one with a mortgage lender.

Most large banks offer buy to let mortgages, along with some specialist lenders. Before applying for a buy to let mortgage, it’s a good idea to speak to a mortgage broker who can help you find the most suitable deal.

What Are the Buy to Let Mortgage Rules?

There is usually certain buy to let mortgage rules and criteria that you need to meet. To obtain a buy to let mortgage, the following rules will need to apply:

  • You should already own your own home.
  • You should have a good credit score.
  • You should earn over £25,000 a year.
  • You must be no older than 70-75 when the mortgage ends. For example, you may struggle to find a buy to let mortgage lender who will agree to a 25-year mortgage if you’re currently 52 as you would be 77 when the mortgage ends.

What Property Can I Get a Buy to Let Mortgage For

You can get a buy to let mortgage on most houses or apartments purchased to let out to tenants.

However, certain property types, such as off-plan properties, are difficult to buy with a buy-to-let mortgage.

Those who want to obtain a mortgage for a rental property could struggle to do so with off-plan investments.

Because mortgage lenders will typically only guarantee the amount they’re going to lend for up to six months, they’re unlikely to agree to fund an off-plan investment if the development doesn’t complete within this time.

What if I Don’t Use a Buy to Let Mortgage?

If you don’t want to use a buy-to-let mortgage when buying to rent, you can always pay off your property investment fees in full.

If you have the money to do so, this may be the easier option, as you won’t have to worry about keeping up with mortgage repayments and possible rising mortgage rates further down the line.

Many property companies and developers will also allow a property to be paid for in instalments, which is a good option if you don’t have the full sum of money right away.

Buy to Let Tip: Speak to a Buy to Let Mortgage Advisor

Deciding whether or not you should use a mortgage for your buy to let property is an important part of your investment journey.

While we’ve tried to provide you with as much information as possible on the basics of buy to let mortgages, you should also seek out the help of a mortgage advisor.

This way, you can get first-hand top tips and buy to let mortgage advice on things like mortgage repayments, interest rates, types of mortgage, and finding a mortgage provider.

11. Learn About Buy to Let Taxes

The tax implications of buy to let property can sometimes turn people away from the idea of buy to let, which is why it’s so important to educate yourself on the potential fees involved before making any big decisions.

Amy Jackson, RWinvest

Speak to a Financial Advisor for More Information Speak to a Financial Advisor for More Information

Buy to Let Tip: Speak to a Financial Advisor for More Information

Investing is a big deal, and while this guide offers information on what to expect in terms of buy to let costs and taxes, you should consider seeking the advice of a financial expert.

This will allow you to be a lot more knowledgeable on the subject and fully prepared for any buy to let property tax that comes your way.

12. Ensure Your Investment is Safe and Secure

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Top Buy to Let Tip: Remember That Research Is Key

While investing is a lot about taking risks, it’s also essential to minimise any potential risks as much as possible.

Whether researching insurance policies to protect your buy to let investment or researching the property company and developer behind it, the due diligence stage is essential for every buy to let investor journey.

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Buying an Investment Property: Your Next Steps 

Now that we’ve covered the main elements of buy to let and offered top property tips on how to succeed as a first time buy to let investor, your next step is to explore current buy to let investment properties in the UK.

Be sure to keep the following things in mind when searching for your buy to let property:

  • Look for properties that are within your budget.
  • Find buy to let property investments offering yields of over 6%.
  • Make sure the buy to let property you select is based in a UK property hotspot where rental demand, rental yields, and capital growth prospects are high.

Explore Buy to Let Properties For Sale With RWinvest 

Luckily, by exploring buy to let property investment opportunities with RWinvest, you can meet all of the above criteria and more.

When it comes to property, buy to let offers some of the best prospects for building a lucrative income, and here at RWinvest, we have the right knowledge and the best opportunities to help you succeed.

Some of our latest opportunities include the completed and tenanted student buy to let property, Shaw Street Liverpool, with prices from just £69,995 and 8% buy to let yields.

No question is off-limits when it comes to purchasing your first buy to let property.

Whether you’re concerned about risks and returns or want to be sure you know the best buy to let areas for growth and demand, we can help.

Whatever your query, our dedicated team are happy to offer further top tips for buy to let success, and helpful advice to make your investment journey run as smoothly, safely and securely as possible.

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If you’re ready to find a buy to let property for sale and get involved in your first buy to let scheme, contact us today to explore our buy to let investments for sale in the UK.

We find the best buy to let properties in some of the top UK locations like Liverpool and Manchester, bringing our investors buy to let flats with high yields and strong capital growth.

Be sure to also keep up to date with our buy to let news update section for regular articles and blog posts on market updates, buy to let tips, and answers to common questions such as ‘what’s better: a property or pension?’ and ‘can foreigners buy property in the UK?’.

You can also listen to the buy to let episode of our RWinvest property podcast – the Property Talk, for tips and advice while on the go.