Buy-to-letters: fewer than half have a clue what they're doing
Published by Anonymous for 24dash.com in Housing
Buy-to-letters: fewer than half have a clue what they're doingImage: To Let via Shutterstock
Fewer than half (43%) of buy-to-let investors fully understood what they were doing when they entered into the deal, new research has found.
And Platinum Property Partners' (PPP) study also showed that only 18% of buy-to-letters did 'a lot' of research before entering the market.
Even more remarkably, fewer than one in ten (7%) did any of the following: sought advice from experienced investors; consulted lawyers or accountants; consulted a book written by an expert.
Such inadequate planning and preparation will have significant ramifications on the investment potential of each buy-to-let property, PPP says.
Steve Bolton, PPP's founder and chairman, said: “As with any investment, extensive research and planning for buy-to-let investors is paramount. It is astounding how little thought and preparation many investors are giving before diving in and making such a substantial investment decision. Neglecting to spend a reasonable amount of time and energy to devise a strategy for your buy-to-let investment can prove costly.
“Research and advice is essential to help pinpoint the right type of property and identify the right locations to maximise income and in fact, whether this type of investment is right for you.
“It’s crucial that choices are made that reflect an individual’s own unique circumstances and goals, and are appropriate for the amount of investable capital available. We would therefore urge prospective investors to exhaust the plethora of resources available and consult experts before they make any hasty decisions.”
According to the Office of National Statistics, the average buy-to-let investor in the UK currently has a property portfolio of £650,000, while recent PPP research shows investors achieve an average gross yield of 5.6%.
PPP is a specialist buy-to-let business.