Almost half of all landlords in the UK now own at least two properties, according the latest Landlord & Tenant Survey from the Property Academy. It is reported within the survey that over a quarter of landlords have at least 3 or more properties and 9% own over six. This highlights a frequently growing trend where landlords have consciously decided to grow their portfolio and invest in more property.
The strength of this type of investment is extremely appealing and can become incredibly fruitful the higher up the ladder you climb. We all must start from somewhere though, so with that in mind here’s our quick tip list on how to grow your property portfolio.
It All Begins With One
Ah, your first one – they’re always the hardest and, at times, the most heart-breaking! Isn’t that the truth! A relationship with your first buy-to-let is like your first ever emotional relationship with another person. Subsequent relationships are significantly easier! If you have the money, refrain yourself from rushing in with multiple properties. If you already have an existing portfolio, don’t rush things and make sure you perfect what you have on your plate before moving on to the next course.
Keep a Buffer
This cannot be underestimated at all, especially if you are looking to build a portfolio quickly. Although it does not necessarily spell failure immediately, it’s never helpful to start with nothing and it certainly won’t make it easy for you to expand. You will not be able to achieve your next investment opportunity if you have to keep dipping into your funds for unexpected repairs and maintenance work. Therefore, create a buffer for each property in your portfolio as a ‘just in case’ investment. You never know!
Buy Low and Sell High!
If you can do this then you are rapidly on your way to building a large portfolio, especially if you can do it over and over again. A lot of properties are sold for less than they are worth sometimes, as a matter of personal circumstance. The trick is finding where to look and how to bid for these properties!
Be at the Right Place at the Right Time
Each and every property market in the world goes through cycles, just like any other business. Finding properties that have hit rock bottom but show signs of rising in value are easy keys to success here. Equally, you should be wary of purchasing properties at the pinnacle of a property boom as it may be a long time until they go up in value again.
Do Your Research and Then Research it Some More
You simply cannot research enough, it really is true. Having the ability to analyse an area and know exactly what is required for success is an envious skill. This prevents you from buying the right house in the wrong are and vice versa! This is a very time consuming task in itself and therefore better left to your estate agent or broker.
Keep Your Tenants Happy
A portfolio is only as good as the landlord and acts as an accurate representation of their abilities and competencies. Happy tenants mean happy paying customers and unbroken streams of rental income. Reputation also goes a long way in this game too so it won’t harm you if people speak well of your services.
Don’t Rush Things!
The last and most vital tip is to not be too hasty! You must be mentally prepared to see hundreds of properties without purchasing one – this is the mentality you must have to be successful in this market. If you are impatient and act on impulse then it may end up in disaster and a property that’s more trouble than what it’s worth.