When it comes to living in a property, new-builds are a bit like Marmite. But it goes without saying that as a buy-to-let investment there are plenty of good things (and some not so) that you should consider before handing over your cash or buying off plan.
All the fixtures and fittings in a new build property tend to be the latest on the market. Many of the higher quality developers will kit out their properties with the latest, most contemporary taps, tiles and appliances in an attempt to attract buyers. This is good news for a landlord – as a quality finish will, in turn, attract tenants.
You will usually start with a minimum of 95 years on the lease (obviously there are exceptions). This can provide more security for an investor and save the hassle of having to extend a lease if it starts to get close to its renewal period.
You can often negotiate packages or discounts for purchasing more than one property from a developer. Not exactly a ‘BOGOF’ kind of deal but you might be able to save yourself a bob or two if you approach them about a bulk buy. Worth a try right?
New homes are more energy efficient. That can be a massive draw for tenants these days. Plus, it’s generally more green.
There’s less DIY! It’s true, not only is there less maintenance involved with a new build home, but they usually come with a managing company that will fix things that go wrong at the drop of a hat. So if the roof leaks or the intercom breaks, it’s just one simple phone call or email and your wish is their command, saving you time and money on repairs.
The process of buying a new-build can be more simple and speedy. If the property is brand new, there won’t be any chain to consider, so as soon as the place is ready, you can move your tenants in.
It’s not a given for any new build but many will have a service charge that costs more than your average building.
New-build developments tend to be bigger and have more properties in them than older blocks. This can mean that there is more competition from other landlords and could mean your rental return is lower.
Often, you will pay a premium price for the convenience, fixtures and fittings of a new-build home. This can mean (although it’s not certain) that it takes longer to make any profit from the investment.
Although we know how great new-build properties can be, it’s still true that older properties, perhaps those with higher ceilings or more traditional features tend to be more sought-after.
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