If the news about lower mortgage interest rates is stimulating you into look at buy to let Terry Lucking of Belvoir Lettings urges you to think carefully about the people you may chose to work with in the selection and management of your investment.
There are lots of property groups and clubs that claim to be experts. They offer you an invitation to a seminar and try to brain wash you with information about how you can buy below market value and instantly create equity without spending a pound.
I urge you to do your research. Check the financial status of the business on Companies House. If they a re newly registered business or have a weak balance sheet is this really a business you should be taking advice from?
Talk to other investors that have worked with them finding properties. Spend time to see how much a local estate agent values the deal you are considering investing in – most likely you will find the ‘below market deal’ is actually being sold to you above the market price. You may ask how can this happen. Part of the 2008 financial crisis is down to creative over valuation of assets and it is starting again.
Remember the rule is Buyer Beware ‘caveat emptor‘ . The investment market is not regulated and sharks exist. Why part with your hard earned cash without spending a few hours checking those lovely people are actually genuine and honest. If they are genuine they will be open with information to help satisfy your questions.
Nothing or little in life is free and usually when it is as easy as these “experts” claim there is a major risk. Not long ago many of these “investment experts” were telling us how wonderful the sell and rent back deals were – now outlawed by the FSA.
The real “experts” in the lettings industry are the letting agents. Find a mature letting agency in your local area and you will most probably get all the advice you are looking for without facing a charge for it. The advice you will get from a letting agent that has no involvement with income from selling properties will be unbiased. Compare this to advice given to you by an investment club that will charge around 4% of the sale value as a fee for saving you money!
Note there are no mandatory regulations for control of letting agencies. There are a number of mandatory requirements agencies have to fulfill but none relates to how they manage your money.
Try to avoid rushing into deals or offers that sound to good to be true. If someone is planning to charge you for finding or buying a buy to let property walk away – you don’t need to pay search fees and discounts are usually an illusion as they are most often wrapped up in the price. Select an agent who you feel will be your partner protecting and managing your assets and avoid making your assets into a liability.
This article was prepared and written by Terry Lucking owner of Belvoir Lettings Agency in Peterborough and Cambridge. Terry offers free advice and free property visits to all investors who are considering buying.