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Is being a landlord right for you?

Review the questions below and, if you answer yes, then becoming a landlord may be right for you.

  • Is your deposit 15% or more of the property’s value?
  • Does your rental income cover 125% or more of monthly mortgage repayments?
  • Could you afford to pay the mortgage if interest rates rose or if you do not get a tenant for a period of time?
  • Have you researched fully your local rental and housing market?
  • Do you know your target tenant and is the property ideally suited to them?
  • Are you a people person? You’ll be dealing with different types of people: solicitors, mortgage lenders, tenants and/or lettings agents, insurance advisors, maintenance people (e.g. plumbers), and local authorities
  • Are you responsible enough to ensure you comply with many regulations?
  • If the boiler, or other vital equipment, breaks could you afford to replace it immediately?
  • If the ability to offset buy-to-let mortgage interest against tax on rental income was abolished, would you still be able to comfortably cover your monthly bills?
  • If your property failed to rise in value, could you hold your investment for the next five to ten years?

Remember, buying a buy-to-let property is a business decision, and you must ensure the figures add up, no matter how desperate you are to invest in property.