Buy To Let
Buy To Let
Becoming a Landlord can be a rewarding experience, renting a property that you own to tenants. If you are considering a new Buy-to-let purchase, Squire Property Management would be happy to assist by providing rental values, offering advice on suitable locations, types of property, preparing your property for let, or looking over any potential property details for you.
When purchasing a property to rent out, you can use your own cash, or take out a buy-to-let mortgage with a cash deposit. Once you have purchased a property, you can potentially earn a profit in a number of ways…
Rental Yield: This is calculated as a percentage as follows: Monthly rent received X 12, divided by the purchase price, X 100 = Yield percentage. You should also consider running costs in your calculation such as repairs and agency fees.
Capital Growth: The profit that you earn if you sell your property for more than you paid for it. If you make a profit when you sell your buy-to-let property, you will be liable to pay capital gains tax.
Mortgage Paid: If your investment is left to run for the term of the mortgage, you can potentially pay off the mortgage in full using rental income.
Please consider that rental and property values, along with interest rates can fluctuate, which may affect your investment. Other costs to consider are Survey fees, solicitors fees, stamp duty land tax, running costs and ground rent/service charges if applicable. You will also need to pay tax on any profit from rental income.
More information about Landlords tax and legal obligations can be found here.