Investing can feel a little daunting at first – especially when you are investing in a property. A property is a huge investment for the everyday person, and you need to make sure you are making a smart investment. You can do a few things to make sure you are choosing the best property and getting the most bang for your buck.
The number one reason people invest in properties is to generate an income. You can rent out that property and use the rent payments to pay off the mortgage and build up equity. Or you can use the property to help family members – whether that’s financially or by giving them a place to live. Interest rates are low now, and more people are starting to make property investments to make their savings flourish. For example, the average savings account holds an interest rate of 1% – while a buy-to-let property sits at 5-6%.
Before you can invest in a property, you need to weigh up all the additional expenses such as purchase price, tax, maintenance costs and management costs. Consider these costs in relation to the profit you may obtain from the property – is it worth it?
If you are currently viewing properties to invest in, you need to consider a few things.
Check to see if the property smells mouldy or there is flaky plaster and watermarks on the walls. Damp will usually show around the ceiling and skirting boards, so keep a close eye as you walk around the property.
Window renovations can take months and cost you a lot of money. Check to see if the windows have cracked paint, single glazing, rotten frames and other signs of age and wear. You want to aim for double glazed windows that have been well taken care of or recently refurbished. If there are double glazed windows with condensation in-between the panes, they are probably faulty.
Electrical installation is a key part of any house, and it needs to include high-quality grounding rods. Grounding rods ground electricity and prevent surges of voltage from electrocuting you when a device is damaged. Before you invest in a house, you should make sure the electrical system is safe and installed correctly.
You also need to make sure there are enough power points around the home. We use many electrical devices these days, and it’s essential to have enough charging ports available in every room.
Make sure the property’s energy performance certificate (EPC) rating is updated and correct. You should also examine whether the plumbing is to scratch and needs fixing.
Property investment has its advantages and disadvantages. Make sure to take your time with the decision and make the best investment for you.