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Residential property is typically one of the safest types of property to invest it. You can hang on to it for a few years, waiting patiently while you watch its value rise and the mortgage is paid down by your tenants. When a smart investment is made in property, it can end up being a retirement fund for your golden years, ensuring you have a relaxing and enjoyable time without any financial woes. But with that said, there is a lot to be aware of before taking that first step and purchasing an investment property.
Here we’ll take a look specifically at investing in a block of flats, and what you should know before you go ahead and sign the deal.
Are You Ready to Become a Landlord?
The first question to ask yourself is whether or not you are truly prepared to become a landlord. It can be a stressful job to take on, and very time-consuming. If you have another full-time job, it can be difficult to juggle both. This is why many property investment owners often end up hiring a property manager to take care of day-to-day issues.
Make Sure the Property is a Wise Investment
Unlike shopping for your own personal residence, shopping for investment property will require you to leave your emotions out of the equation. You need to think in terms of investment, what property would give you the highest return on your investment, and what property would be the easiest to rent to your target market? It’s not about where you want to live; it’s about your future tenants.
Do You Have a Large Down Payment?
Typically, the down payment for a block of flats is will be higher than the deposit you’d be expected to pay towards your own house. This is something you will want to research well in advance to ensure you’ve got enough cash for the down payment.
What About Renovations?
The property you have your eyes on may not be ready for rental right away and may require some renovations. It’s wise to price these out before you enter into a deal and make sure they are within your budget.
Remember You Will Need to Insure the Property
Another thing to keep in mind is that you will need to ensure the property. In the UK, this is called a block of flats insurance and refers to a policy for a building that contains a number of separate residences.
This type of insurance can vary quite a bit depending on the provider, which is why it’s a good idea to use a comparison site to obtain a block of flats insurance quotes. Once you fill in the short form online, and you’ll be given a list of quotes from the most popular providers.
Building a Nest Egg through Investment Property
At the end of the day, investing in a block of flats could prove to be that nest egg for your future as long as you enter into the deal well-informed and prepared.