The current uncertainty over the UK’s commercial and residential property markets means that would-be investors should be very careful before committing their cash. Maunder Taylor operate a property investment management agency in Barnet, and neighbouring parts of North London and Hertfordshire. Here are our top tips for successful property investment.

Know Your Market

Whether you are interested in investing in commercial or domestic property, find out what the ‘going rate’ for both is. Check out the long-term trends (in terms of prices and values) for the areas you are interested in. Some of this research can be done online – there are plenty of sites which give the recent sales history of a particular area – but the local press is also a good source of information. This will give you more of a ‘feel’ for what the neighbourhood is like.

You shouldn’t restrict your searches solely to prices. Sometimes there may be outstanding planning applications which could have an effect on values; equally, there may be financial incentives on offer from the local authorities.

Know Your Law

Having a good knowledge of your legal responsibilities is essential if you are going to become a landlord. There are a whole host of rules and regulations which you need to know about – otherwise you could face legal proceedings (including the potential for hefty fines or even prison sentences).

This includes areas such as:

  • Electrical and fire safety
  • Energy Performance Certificates
  • Your own rights over the tenant (for instance if they are late paying)
  • The tenant’s own rights and responsibilities (for example the protection of their initial deposit)

Even if you pass over the responsibility to a property management agency – such as Maunder Taylor – it will save you and them a lot of time if you know what your responsibilities are already.

Take a Strategic, Long-Term View

Bear in mind that property prices can go down as well as up – which is why it may be advisable to wait at the moment, if house prices in particular are likely to fall (as some experts are predicting). The recent political upheavals, and the effective shutdown of parts of the economy due to the coronavirus, are events which you cannot control but have the potential to affect the value of your investment.

For instance, it may be better for residential property investors to opt for buy-to-let rather than buy-to-sell – the former may give you a steady income, while the latter may be affected by overall house prices which are beyond your control.

Either way, making a profit on property is not something that can be guaranteed – and certainly not quickly. Bear in mind, you may be tying up some of your personal assets or wealth for a long period of time and pulling out of any property investment is not something that can be organised overnight, with potential penalty clauses if you ‘opt out’ early.

Find the Right Tenant

Unreliable tenants who pay late, or don’t pay at all, can seriously impact your cash flow – and knock a hole in your best-laid plans. Carry out plenty of checks on a person (or business) before you let them move in – or let a professional company carry out the checks for you.

Any would-be renter in England should be given a copy of the Government’s ‘How to Rent’ checklist by their landlord before they move in (it can be emailed to them). Smart landlords also insert a clause in the tenancy agreement stipulating what the penalties are for late or non-payment of rent.

Stick to a Budget

Again, this applies whether you are looking at commercial or domestic property. Becoming a private landlord will mean a lot of ongoing expense when it comes to inspections and valuations (which some mortgage companies may insist on). You will need to ensure you’re properly insured as well.

There’s also the issue of tax – whether it’s stamp duty, capital gains or income tax (payable on any rental income from your property). All of these will eat into any potential return on your investment.

Bear in mind that all of this needs be factored in before you make any improvements to your property, if you are thinking about buy-to-sell, where strict budgeting is also essential.

The general advice, particularly when it comes to commercial property, is to start off small and build up your portfolio gradually.

Maunder Taylor – A Property Investment Management Agency in Barnet

When it comes to property management, Maunder Taylor offer an unrivalled service. When it comes to commercial property, we offer clients the choice of direct or shared investment (the latter is ideal for those who do not want too much exposure to risk) in commercial property; either way, we usually get a return of around 7-8% per annum for all our clients.

We also operate an independent estate agency in Whetstone, Potters Bar and the surrounding area and always have plenty of houses on our books if you are looking for residential property investment.

We effectively operate an ‘all-in-one’ service as we can also help with residential property management if you haven’t got the time to devote to being a full-time landlord. We can also help with house valuations and surveys, business lease negotiations, any legal issues which arise along the way – in fact, anything to do with residential or commercial property investment in North London and Hertfordshire, we have it covered.

To learn more, follow this link and fill in the online form; you can also call our Whetstone office on 020 8446 0011.