Buy to Let Properties: Best at Below Market Value
Parmdeep Vadesha
October 28, 2008
The best-kept secret of many property investors comes in three words: below market value. Popularly termed BMV, below market value properties are those priced below their current true market worth. Definitely one of the best deals you will find in property investments, buying below market value is the way to start off a career in property.
So how do you determine if a property is priced below market value? Although there is no hard and fast rule, the best measure is through a comparison. Measure up your chosen property with the prices of other properties with parallel specifications and in the same location. Although asking prices will vary depending on the seller’s demands and other factors, this simple test will at least give you a bird’s eye view if you are getting your money’s worth on a potential investment.
Make buying below market value your goal as you hunt for your very first investment or search for a property to add to your growing portfolio. In the midst of rising prices and a somewhat troubled economy, bargains are still available. Look wisely, choose carefully and hunt for those low prices!
Buy to Let Properties at BMV
The strategy of buying BMV has also become increasingly popular in buy to let property investments. For one, an inexpensively priced rental property will make ’stacking up’ much easier to achieve. Stacking up, a familiar term among buy to let investors, simply means making your rental income cover both your monthly mortgage payments and leaves you with some extra income to cover those untenanted periods, unforeseen emergencies and unplanned expenses. The price tag of your property investment should be low enough to remain competitive yet be reasonable to afford you with enough leeway for contingencies.
Now that we have the arithmetic of buy to let covered, there are some other considerations to keep in mind when investing in rental property. Buy to let is first and foremost a business with tenants as your clients. Choose the location, pick out the amenities and determine the price with your tenants in mind. Here are some tips for a rewarding buy to let experience:
Get to know what tenants want. Generally, families require security, students prefer affordably-priced flats and young professionals want trendy spaces in fashionable locations. To be more specific, know the needs of the local community whether it is a spacious front yard, ample parking space, or proximity to public transport.
Fill in a void in the market. There is no use getting a good deal on a one-bedroom flat if the demand in the area is all for three-bedroom family homes. Buy to let investors should always strive for minimal void periods and untenanted months. The only way to achieve this is through supplying what the rental market needs.
Ultimately, profit and success in buy to let investments begin with an affordably-priced property. Remember to always be on the lookout for the best deals and to only buy below market value.
So how do you determine if a property is priced below market value? Although there is no hard and fast rule, the best measure is through a comparison. Measure up your chosen property with the prices of other properties with parallel specifications and in the same location. Although asking prices will vary depending on the seller’s demands and other factors, this simple test will at least give you a bird’s eye view if you are getting your money’s worth on a potential investment.
Make buying below market value your goal as you hunt for your very first investment or search for a property to add to your growing portfolio. In the midst of rising prices and a somewhat troubled economy, bargains are still available. Look wisely, choose carefully and hunt for those low prices!
Buy to Let Properties at BMV
The strategy of buying BMV has also become increasingly popular in buy to let property investments. For one, an inexpensively priced rental property will make ’stacking up’ much easier to achieve. Stacking up, a familiar term among buy to let investors, simply means making your rental income cover both your monthly mortgage payments and leaves you with some extra income to cover those untenanted periods, unforeseen emergencies and unplanned expenses. The price tag of your property investment should be low enough to remain competitive yet be reasonable to afford you with enough leeway for contingencies.
Now that we have the arithmetic of buy to let covered, there are some other considerations to keep in mind when investing in rental property. Buy to let is first and foremost a business with tenants as your clients. Choose the location, pick out the amenities and determine the price with your tenants in mind. Here are some tips for a rewarding buy to let experience:
Get to know what tenants want. Generally, families require security, students prefer affordably-priced flats and young professionals want trendy spaces in fashionable locations. To be more specific, know the needs of the local community whether it is a spacious front yard, ample parking space, or proximity to public transport.
Fill in a void in the market. There is no use getting a good deal on a one-bedroom flat if the demand in the area is all for three-bedroom family homes. Buy to let investors should always strive for minimal void periods and untenanted months. The only way to achieve this is through supplying what the rental market needs.
Ultimately, profit and success in buy to let investments begin with an affordably-priced property. Remember to always be on the lookout for the best deals and to only buy below market value.