Direct Residential Property Investment Club

Direct Residential has many years experience at identifying Investment Opportunities to offer to landlords and can assist with the analysis and selection.

With extensive knowledge and experience in the property management and lettings business and through procurement links, we are delighted to offer a small selection of chosen properties. Naturally these change on a regular basis and we should be contacted to obtain an up to date list.

Buy to Let

Buy to Let has seen phenomenal growth since its launch in 1996. By the middle of 2003 there were 334,800 loans outstanding, worth £31.29 billion.

Buy to Let has contributed to the recovery of the private rented sector over the past decade and has increased the number of individuals who are landlords, ranging from first-time landlords to professional investors with significant property portfolios. Lenders’ experience of Buy to Let has so far been very positive, with very low levels of default and very few repossessions. Buy to Let continues to be an attractive option for investors, particularly at a time when stock market returns are looking uncertain. But borrowers need to view Buy to Let as an investment for the long term, over which it offers prospects for both capital growth and income.

Up-to-date figures dispel the notion that Buy to Let has run its course.

There is even a new sub-sector in the shape of Rent-to-Buy that hopes to bridge the gap between renting and home ownership and provide solutions for first time buyers. Meanwhile the support for the Private Rented Sector by investor landlords is steady – without the need for dramatic headlines – and tenant demand continues to grow. As well as the obvious success of an investment that is both controllable and understandable, Buy to Let has had a significant effect on the rental market as a whole.

Since the advent of Buy to Let seven years ago, renting a home has become socially acceptable again and many now choose to rent for may reasons other than fur purely cash considerations.

Today, the Private Rented Sector is able to offer genuine choice in housing – and it was to bring that choice to the housing market that led ARLA to launch Buy to Let in the first place.

An Investor Should..

• Plan to be a Buy to Let Landlord over the medium to long-term as it is an investment that produces a variable combination of rental yield and capital appreciation
• Make an objective business decision when purchasing a property based on research of the needs and requirements of the local market, not based on personal taste
• Be aware that the rental market is fast-moving with fluctuating supply and demand. This can influence achievable rental levels and occupancy rates
• Take informed advice from both professional letting agents and specialised financial advisers from the beginning

A Lender Should...

• Conduct a thorough analysis of affordability and not lend more than you can afford to repay
• Undertake a professional assessment of the security and the reasonableness of the forecast rental income
• Provide clear information on Buy to Let products and services and on your obligations as a borrower
• Explain what to do if you get into difficulties with mortgage repayments

A Letting Agent Should...

• Demonstrate a comprehensive understanding of the legalities, regulations and obligations which apply to landlords, tenants and agents
• Be able to competently explain the areas predicted for growth nationally
• Provide realistic and up-to-date guidance on supply and demand based on a detailed local knowledge of the market
• Hold professional indemnity insurance, separate client accounts and a client money bonding scheme, and employ trained, qualified staff
• Have access to a complaints process over the service standards of letting agents and to procedures for resolving disputes over deposits between landlords and tenants

The Do's and Dont's of Buy To Let

• DO think of Buy to Let as a medium to long-term investment
• DO seek advice from a letting agent on local/national market demands
• DO get your sums right. Will the rent cover borrowings and costs, after allowing for void periods?
• DO decorate, fit out and furnish to high standards, especially kitchens and bathrooms, to attract the best tenants and let quickly every time
• DO use your letting agent. They are bonded, hold professional indemnity insurance to required standards, have staff trained to competent standards and are kept up to date with the latest legal and regulatory requirements
• DON’T let personal taste cloud your judgement. Be sure the property you choose meets market requirements
• DON’T purchase anything with potential maintenance problems such as a lot of woodwork or large garden. It will add nothing to the rental value and cost a lot to keep up
• DON’T think that the running of an investment property to let can be left to friends or relatives in your absence. Tenants require a full management service
• DON’T use off-the-shelf tenancy agreements from HMSO or law stationers, forget to issue the right notices or fail to have a property inventory and condition report made before a tenant moves in. Leave all documentation to a professional agent
• DON’T furnish with second hand furniture or cast-off soft furnishings. These will probably contravene the furniture and furnishing regulations

BEFORE YOU BUY

Buy to Let landlords need to be aware of local market conditions before purchasing property and that’s where an experienced letting agent can help.

Direct Residential can meet and exceed all expectations in this arena - call 01372 722266 or email Ian Plumb.