Q: I AM looking to buy a property to let, do you have any tips or considerations?

Mrs K, Stroud.

A: When looking to buy to let, I would recommend the following:

1) Consider capital growth.

How long are you planning to have the property and how much is it likely to increase in value during that time?

This is a very difficult thing to estimate, but think about your long term plan and how the area you are buying in is likely to change in that time.

2) Calculate your yield to get this figure the annual rental amount is divided by sales value e.g. a rent of £550 pcm x 12 for the yearly figure = £6,600 divided by the sales value £150,000 = 0.044 or 4.4 per cent.

I have used this example as it is fairly typical of the local area, you will find that the average yield in the local area is between four per cent and five per cent, though slightly higher yields are possible if you buy very well.

3) Widen your target market, when buying a rental property you need to think about buying something which will appeal to a wide section of renters rather than what would be your personal preference.

This will increase the demand and therefore fetch and maintain a good rental value as well as minimising your void periods.

Consider accepting pets and Housing Benefit tenants where appropriate.

4) Avoid major down sides such as difficult access, strange layouts, and high levels of noise pollution, dangerously steep gardens, anything that is likely to put potential tenants off.

5) Look for convenience - parking, garden, access to transport links, local amenities, ease of access in to towns all of these things will increase your investments appeal, tenants are often not looking for their dream home but something which will be convenient and fit their basic requirements.

6) Estimate your cost of maintenance and repair.

Modern properties are much cheaper to maintain.

For example on a new build for the first 10 or so years or so you would not expect to spend out on anything other than routine maintenance such a yearly boiler checks and perhaps a lick of paint every couple of years, whereas with an old cottage you are likely to have damp issues, leaks, need to replace the kitchen, carpets, boiler or electrics as well as the routine issues.

7) Consider any maintenance/management fee.

You will typically find that leasehold propertied e.g. flats might be cheaper to buy, but will have monthly or yearly management/maintenance fees and or ground rents which you need to calculate into your yield.

8) Mortgage, agent fee and insurance.

Count in your mortgage re-payments, agency fees and the expected cost of insurance building insurance, and rent protection insurance if you intend to use it.

9) Estimate average turnover/possible void periods.

The average rental turnover locally is at around 20 months, this is typically higher with one bedroom properties as these attract young people who are more likely to move more regularly due to work or relationship changes, and rental properties of four plus bedrooms, which families tend to rent during work placements or while looking for somewhere to buy, whereas two and three bed properties will tend to have more long term tenancies as they attract a more settled demographic and offer flexibility of space.

10) Energy efficiency is increasingly important as tenants either do not have a huge income so cannot afford to buy, or are saving to buy so are very budget conscious therefore the threat of high energy bills is likely to put them off.

Energy efficiency ratings are better in more modern properties.

Please continue to send in your property related questions to clive@sawyersestateagents.co.uk