When a lot of would-be investors start in buy to let, they often have dreams of buying really nice houses, in really nice areas.
But are those the best properties to buy as an investment?
Often the answer is no.
By and large the best properties for investing are cheaper properties in cheaper areas.
This can be a bit of a shock for some (would-be) investors.
Surely bigger properties pay more rent?
Perhaps in absolute terms, they do, but (usually) not as a proportion of the purchase price.
In other words, the return isn’t (usually) as good on a larger, more valuable property than as with a smaller, cheaper property, in a cheaper area.
And usually there are more tenants who will rent a smaller, cheaper property than who will rent a larger, more expensive property.
But, usually comes the retort, won’t you get more capital growth with a nicer, more expensive property?
Perhaps, but you can’t guarantee capital growth. You can’t control capital growth. But you can buy for cash flow and control cash flow, and the properties with the best cash flow (returns) is often achieved on the smaller, cheaper properties in the not such nice areas.
Anyway, I tell you all about it in the video.
Here’s to Successful Property Investing.
(ex) Chartered Surveyor, author and property investor
PS. By the way, I’ve rewritten and updated my best-selling e-book, The Successful Property Investor’s Strategy Workshop, which is an account of how I put together my multi-property portfolio, starting from scratch and with no money of my own, and how you can do the same.
For more details please go to: