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The Dangers Of Long Distance Buy To Let

    Home Property Investment The Dangers Of Long Distance Buy To Let
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    The Dangers Of Long Distance Buy To Let

    By Harvey Raybould | Property Investment | 0 comment | 28 April, 2019 | 0

    Buy to let property investment opportunities may not be that great where you live and you may have to look further afield. If you live in London or the South East then you will know that yields on buy to let properties have taken a nose dive over recent years.

    On the flip side buy to let properties in the North of England have the potential to return much higher yields so it’s just a case of finding properties in other locations isn’t it? Well in theory yes. We would always recommend that you find good buy to let investment opportunities wherever you can but there are some dangers associated with this.

    So what are the Dangers of Long Distance Buy To Let Investing?

    Basically there are a number of dangers associated with long distance buy to let property investment. You can face unruly tenants that do bad things without you even knowing about it, you could be the victim of fraud and you may face steep property management charges.

    The prospect of lower house prices and higher rental yields has driven many a buy to let investor to travel long distances to build their portfolio. In the Midlands and the North of England and some areas of Scotland and Wales you can really be on to a good thing.

    When you compare the average rental yield in London of 3.2% to the average in the North East of England currently at 5% it is a no brainer. The average rental yield in the North West is currently 4.8% and areas of Scotland and Wales are at 4.6%. And of course it costs a lot less to purchase properties in these areas.

    But there have been examples of long distance buy to let investors facing significant issues. Some people even try to do this when living in another country and when one investor tried this he ended up losing money.

    He found out that one of his properties had been sublet illegally and he suffered a £6,000 loss. While abroad he relied on friends in the area to find tenants for him but this had disastrous consequences. In one of his properties the tenant had not paid rent for months and he knew nothing about it.

    This buy to let investor only discovered the illegal sublet through luck. He had heard a rumour that one of his tenants had moved away so he asked one of his friends to go and check on the property. They then discovered that someone else was living their on an illegal sublet basis.

    Then there is the issue of unfamiliarity with local laws and regulations. In Wales and Scotland a landlord must hold a license but in England this is not a requirement. Regular electrical checks for rental properties are required in Scotland but not in the rest of the UK.

    How you can Prevent Long Distance Buy To Let Problems

    There is nothing wrong with purchasing buy to let properties in other areas of the country but you really need to do your homework. Find out if different rules and regulations exist especially if you live in one country and are purchasing a property in another.

    Build relationships with local letting agents. You need people that you can rely on while you are far away. Find out what the local rents are so that you don’t charge too much or not enough. Use reliable letting agents to manage your properties if you are not prepared to.

    dangers of UK long distance buy to let, UK long distance buy to let dangers

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