Opinions are divided over whether you should invest in buy-to-let locally or venture further afield in an attempt to achieve better returns.
The area you invest in should be considered alongside your strategy and goals. Certainly if you’re looking to invest in student lets you’ll want to buy near a large, vibrant and growing University. Budget may also be a factor, whereby local house prices are simply too high for you to buy an appropriate property. Many Londoners have to buy outside the city because of this, although many will now rue missing out on the spectacular capital growth London property has seen.
When I began investing in property I spent a long time deliberating on where I should buy. Trying to find the next up and coming area to invest in that offered the holy grail of high yields and strong future capital growth appeared elusive. In the property boom years I researched city centre apartments up North as well as foreign property in Bulgaria, Cyprus, Florida and Las Vegas.
Whilst the glossy brochures promised quick riches, ultimately I decided that the grass wasn’t actually greener elsewhere. There are in fact many reasons why I believe you should keep it simple and invest close to home.
Familiarity is often the biggest reason why many landlords buy locally. You’ll know where the best areas are, which are the decent schools and the good transport links, along with a knowledge of the upcoming developments that will impact the area.
You could spend time walking the streets and meeting with local agents. Nothing beats face-to-face contact and building rapport with people who can advise and support you. It’s easier to spend more time in a local area so you can work out the facts as opposed to relying on third party information.
It is obviously far more convenient to manage a buy-to-let close to home. Whether that be overseeing a refurbishment, the on-going maintenance or managing tenants. Having a property nearby saves a lot of time and this is perhaps why over 50% of landlords choose to buy within 10 miles of where they live.
Buying locally might mean you decide to self-manage the property and therefore save yourself the letting agent’s management fees. Even if you do hand the keys over to an agent, there’s certainly some peace of mind knowing the property is within easy reach should something go wrong or you simply want to keep an eye on things.
If you’re thinking of investing in buy-to-let and would like some free advice about whether your local area can meet your needs, please get in touch.
