Finance & insurance
country were surveyed, and asked a series of questions relating to property management, property preferences and the reasons behind their decision to invest in buy-to-let. One of the most common reasons was for the long-term financial prospects,
which were indicated to be supporting future retirement income. Interestingly though, about 1 in 5 became a landlord by ‘accident’, meaning they could have either inherited the property or gained it through marriage. Should this happen to you, you will still need to challenge yourself about if you want to be a landlord for the long haul. Managing one or several properties can be a handful, particularly if this is only a side venture to a full-time job.
LOCATION. LOCATION. LOCATION. Pre-credit crunch, there were many stories of Buy to Let investors who lost money because they bought in areas they were unfamiliar with, or had not done enough background research on. Most landlords seem to buy property in areas in proximity to where they live – areas they know and feel most comfortable in. For example, 84 per cent of the landlords surveyed operating in London have Buy to Let properties in London, whereas for those operating in the East of England, this was lower at 78 per cent and for the South West of England at 75 per cent. Lesson being: there are others who may look to diversify to other parts of the
country, but to be successful you must do your homework. KNOW YOUR AUDIENCE
Ask yourself, who would be the most suitable tenant for me and my property? Middle-aged couples were found to be the most popular tenant choice, at 21 per cent, followed by families with children at 16 per cent. However, it’s worth noting, one in four landlords said they do not have a preferred type of tenant. But if you do, this needs to be brought into the mix when choosing a property and location to ensure the needs of your prospective renters are being met, and your property is being used to its full potential.
About 1 in 5 became a landlord by
‘accident’, meaning they could have either inherited the property or gained it through marriage
TIME MANAGEMENT Owning a property is likely to take up some of your time, in fact only 21 per cent of landlords operate on a full-time basis. The rest work full-time (60 per cent) or part-time (19 per cent). Paperwork
details, housing maintenance, repair and damage work, and even distance to the property, will carve up the time you can dedicate to this – just imagine if you had several properties to check up on!
LIMITED COMPANY You need to think about whether to set up as a limited company or not. This is becoming more popular but it is not a panacea for all, which is why it is important to seek tax advice. It is also important to seek advice if you need a Buy to Let mortgage to fund the property purchase. This will save you a lot of time and hassle than if you did so yourself.
WHERE’S THE EXIT? It may not seem like a priority concern, particularly after going through how and why to get involved in this thriving sector; but having an exit strategy must form a part of your management plan. Considering how quickly and easily you can sell up in the future, should you
choose to, or whether the property will be part of your estate, planning is key, and will help safeguard your finances for the future.
Jeff Knight is the director of marketing at Foundation Home Loans
Seam Capital say there is always another way to build more homes
S
eam Capital believe the sector trend for increasing financial risk by taking on more debt, or increasing commercial risk by
growing development of housing for sale – is just
not sustainable. There is another way. Seam challenge the status quo and want to work with like-minded people to achieve their social purpose and build more affordable homes – whilst simultaneously making their organisations stronger. Seam are home-grown strategic advisors to
housing associations and local authorities inspired by the desire to materially increase affordable housing development capacity and output to help solve the housing crisis. They are experienced social housing professionals with a wealth of expertise developed over many years spent at large housing associations. Using socially responsible board-approved
solutions, they have developed a tried and tested approach to unlocking the enormous latent value (they call it the 'social equity' ) embedded in balance sheets by offering an integrated approach to business strategy, financial planning and corporate treasury – but always driven by the responsible stewardship of social housing assets and truly strategic asset management.
Many boards believe they have a stewardship, a
social obligation to reinvest whatever surpluses their organizations can produce – be it financial capital, social equity or intellectual property. Social equity is capital by any other name – and as a form of equity can be put to good use in the vital investment in affordable housing development. Using their social and financial investment appraisal techniques, the choices where best to redeploy the value extracted can be evaluated, be it in building more homes, investing in treasury and financial negotiations, or in the underlying business itself. Clearly then, by providing asset-backed driven
solutions to raise capital, reduce risk and also help determine the best uses for that capital – Seam Capital create a truly strategic advisory relation- ship – rather than a purely transactional one. If you are like-minded and would like to hear
more please contact Ray Christopher at 07918 057516 or
ray.christopher@
seamcapital.co.uk
020 3743 6036
www.seamcapital.co.uk
www.housingmmonline.co.uk | HMM July 2018 | 39
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