Tips for buying to let during a recession

As we are all aware, property prices across most of the UK have been in decline. As a result, many property developers have panicked and sold off a lot of their properties, often making a considerable loss.

This fear of losing out tied in with a fall in demand which meant many properties were being sold for much lower than their original price.

Despite early signs of improvement in the market, there are still a lot of bargain properties to be had.

However, as confidence grows and the market improves, so too will house prices. When employment figures and market confidence improves, demand goes up and so do house prices.

It should still be remembered that the market is still unsteady and if you are to take advantage of the market, you must do your research and plan for every eventuality.

• Research - It is important to consider what is popular in the market, ask your agent what kind of properties are selling. Remember, you are not buying for yourself. You should also consider the surrounding areas and factors such as the nearest school, transport links and parking. Buying to let in your local area is often wise since you will know the benefits and pitfalls personally.
• Renovation - Ensure you purchase a property that is in good condition. It may seem like an appealing project to renovate a property but extra work costs you extra money. A property that requires very little work will make you the most money. You should also be aware of properties with a lot of woodwork and large gardens. Such properties will require a lot of maintenance and will most likely add little to the profitability.
• Preparation - "A good landlord should ensure they have thought of all eventualities and have plans in place should problems arise," . Landlords should also factor the costs of tradesmen into their business plan to avoid unexpected costs.  "Sometimes things can go wrong, so thinking ahead is likely to save money in the long run."
• Insurance - "Take out Rent and Legal Insurance,"  "In this current climate circumstances can change and insurance is there as a precautionary measure. The cost of the policy is likely to be far lower than the estimated costs if the tenant falls into arrears."

• Management - It is important to have a hands-on approach to your property. If you are unable to do so because you work full-time or you own multiple properties, be sure to delegate to a professional external party. Either way, it is crucial to set deadlines and budgets and if this is your first time, make sure you seek as much advice as possible from those who have done it before.