So you own your home and are now wondering about investing…
Things to think about before you start:
Being a landlord
- How are you likely to cope with difficult tenants?
- Do you have the mental toughness to deal with tenants who are rough on your property or are constant late payers?
- Would you rather leave landlord duties to a rental agency?
- If you’re planning to make your fortune by buying doer-uppers and boosting their value before renting out and eventually selling, how skilled are you to do most of this yourself?
- Or will you factor in the cost of tradespeople to do the work for you?
- Will you need to top up the mortgage?
- Can you keep your finances under control when interest rates go up or you don’t have any income?
- How secure is your work – is there a risk your income could drop in the near future?
5 year plan
- Create a five year plan of property investment.
- Work out the maximum you would need to purchase a property for and how much rent you would need to make it viable.
Investment property can be a great way of growing wealth, but don’t go buying yourself a super-yacht just yet… making money from property takes time, effort and calculated risk.