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Buy To Let - A Good Time?

Buy To Let - A Good Time?

Property investors release equity to grow their assets

It wasn't long ago that the talk was all about negative equity and the impact rising interests could have in these uncertain times. Yet the Bank of England has remained resolute keeping the bank base rate at 0.5% month on month.

 

Landlords with mortgages have a positive difference between the cost of their mortgage(s) and the rental income they receive. (Known  in the trade as  Positive Leverage) Landlords are making sure  they improve their financial position by saving this increased difference or paying more towards their mortgages.

 

As house prices have remained relatively stable (although starting to take off again) those that are paying more towards their mortgages are achieving workable equity in their property portfolios.

 

Make your equity work for you

When a property has workable equity you have choice of:

 

1. Reducing your monthly outgoings - a remortgage replacing only your present balance

 

2. Increasing your reserves of cash - remortgage releasing equity to put away in a savings account an emergency reserve

 

3. Buying more property - remortgage releasing equity to use as a deposit to buy more rental properties

 

If you're in the "building my business frame of mind"  a mixture of 2 and 3,  can allow you to...

 

Grow your property portfolio aggressively while keeping risk to a minumum 

 

If you choose to grow your portfolio, risk can be significantly reduced by: 

 

  • Knowing what you want to achieve - list your reasons for investing in property and what your ideal outcomes will be,

  • buying property that will achieve your goals - take this list with you and employ Martin & Co Norwich to help you find and buy the right property for you.

     

  • Tracking down an excellent mortgage - speak to mortgage brokers. Let them know how risk averse you are and let them advise you. Most brokers offer free advice and have a view on the whole of the market. With their help you will be able to track down the most suitable mortgage - we can refer you to the best people in Norwich.

     

Firstly though you may wish to do some research on the internet, compare your property against others to confirm your expectations on it's value and be armed with knowledge of the mortgage rates available.

 

To understand what equity you could release and gain a flavour of mortgage rates that could be available, you can use the equity release calculator. And then call us on 01603 766860 to discuss where and what you should buy.

 

Use the Equity release Calculator

Click to use the equity release calculat