No buy-to-let investment decision should be made without first carefully considering the risks. This is by far the single biggest and most common mistake made by newcomers to the BTL market.
Aside from this, there are several additional errors and oversights mortgage brokers encounter more often than others, when working with clients interested in BTL investments. While there is no such thing as a risk-free BTL investment opportunity, avoiding these mistakes at all costs can pave the way for a successful purchase.
Being misled by unrealistic figures
Developers and agents are often guilty of attempting to blindside BTL investors with unrealistic indications of potential yields. Where the average yield on property may be 6%, it is not uncommon for potential yields of up to 12% to be quoted. If it seems too good to be true, it almost certainly is.
Banking on overnight success
BTL never has been and never will be an effective get-rich-quick scheme. Nor is it something that can be entered into without plenty of capital, or a meticulous eye for how the market is performing at the time.
BTL investors should never be misled by apparent ‘guarantees’ on the part of developers, agents and sellers. There is no such thing as a guaranteed rent or return on the BTL landscape, which is why the term is regulated by the FCA but continues to be widely used (and misused).
Not having a strategy in mind
A surprising proportion of those who get into BTL investments for the first time have no specific long-term goals or strategy in mind. They simply purchase properties to let out with the intention of making it up as they go along, which almost always proves counterproductive long-term.
Craig Upton supports UK businesses by increasing sales growth using various revenue streams online. Creating strategic partnerships and keen focus to detail, Craig equips websites with the right tools to increase traffic. Craig is also the CEO of iCONQUER, a UK based company and has been working in the digital marketing arena for over a decade. A trusted SEO consultant and trainer, Craig has worked with British brands such as FT.com, DJKit, UK Property Finance, Serimax and also supported UK doctors, solicitors, builders, jewellers, to mention a few, gain more exposure online. Craig has gained a wealth of knowledge within the digital marketing space and is committed to creating new opportunities working with UK companies.