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If you’re looking for investment opportunities, real estate could be a savvy choice. With the potential to grow your capital and generate a rental income, a buy-to-let property could enable you to generate the returns you’re looking for.
Real estate can be a lucrative investment in general but the type of property you invest in can determine your subsequent returns. To find the best investment for you, take a look at these three reasons why a block of flats could be a good choice as a landlord investment:
1. Multiple Income Streams
When you purchase a block of flats, you can increase your capital if the building or land goes up in value while you own it. In the meantime, however, you can generate a rental income by leasing out each flat to tenants.
In a block of flats, you’ll have multiple tenants, as opposed to just one in a single-family dwelling. This effectively protects your investment and diversifies your revenue streams. If you own one residential home and can’t find a tenant, for example, you won’t generate any income. In contrast, if one unit is empty in a block of flats, you’ll still have multiple income streams coming in from other occupied apartments.
2. Numerous Management Options
Some potential investors are put off because they assume that being a landlord of a block of flats will be time-consuming, but it doesn’t have to be. Although you’ll need to meet your legal obligations as a landlord and take steps to protect the building, this needn’t be complicated. When you’re looking for block of flats insurance, for example, Quotezone makes it easy to compare the cheapest providers and allows you to purchase a policy in minutes.
Furthermore, there are numerous management options available to you as the landlord of a block of flats. If you don’t want to manage the property yourself or hire staff to do this for you, you can outsource property management and maintenance to a specialist firm. Often, this is a cost-effective way to attract tenants, negotiate rental terms, deal with issues as they arise and keep the building in good condition.
3. Flexible Financing Available
Most people take out buy-to-let mortgages when they’re investing in property, as it enables them to purchase real estate more quickly and use the income returns to make repayments. If you want to become a landlord, you’ll need to explore what types of buy-to-let mortgages you qualify for.
However, it’s worth looking at commercial mortgages too, as these may offer more favourable terms. While they aren’t always available for single unit dwellings, launching a company and using it to manage your portfolio could enable you to access a wider variety of financing options.
Finding the Right Investment
With the potential to generate significant returns in the short and long-term, real estate is an attractive option for investors. By getting bespoke investment advice, you can discuss your objectives with an experienced professional, mitigate risk and find the best investment opportunity for you.