With the January blues soon to be out of the way, now is the perfect time to start thinking about your property resolutions for the rest of the year.
Estate agent Portico has put together five top property resolutions for London landlords and homeowners for 2017:
- Increase your mortgage payments
With interest rates currently at record lows, it couldn’t be a better time to reduce the amount you owe on your mortgage. If you can afford to make overpayments – even if it’s just £50 per month – you will pay your mortgage off quicker and reduce your overall interest payments. This could potentially save you thousands of pounds in the long run.
- Beat the buy-to-let tax changes
This year, the amount that buy-to-let landlords can deduct from their rental income when calculating a profit on which to pay tax will be reduced.
While this tax change will make life a little harder for investors, it is important to note that landlords that pay the basic rate of tax and those without a mortgage will not be affected.
Furthermore, there are ways that landlords can cut their interest costs – such as remortgaging. Buy-to-let mortgage interest rates have dropped substantially in the last few years, so you’re likely to be able to get a much better deal in today’s market, insists Portico.
If you’re a London landlord, you will know that house prices in the capital have soared at such a high rate in recent years that getting your rental property re-valued could be another money-saver. This will ensure that your lender recalculates your loan-to-value ratio (LTV), as a lower LTV translates to a better interest rate and wider choice of lenders.
- Invest smartly
One of your property resolutions for the year might be to expand your property portfolio. If so, you must make sure that you buy in an area that is undergoing redevelopment or infrastructure investment. This way, even in a weak market, it’s likely that you will profit from strong rental yields and capital growth.
Portico expects areas in outer London zones to experience the greatest property price growth in 2017. The agent has put together its buy-to-let hotspots for the year: https://www.justlandlords.co.uk/news/landlords-buy-london-2017/
And remember, if you purchase a rental property this year, you should protect it with some of the widest Landlord Insurance on the market!
- Create a new income stream
If you have a vacant property or room within a property, short-term let websites, such as Airbnb, can be great ways of generating more income. Short-term rentals are also a good idea if you have a gap between tenancies.
Portico has launched a new Airbnb property management service for those that don’t have enough time or knowledge to successfully enter the short-term lets market.
- Save where you can
Probably top on everyone’s list of property resolutions is to save some money. Whatever your goal, it’s a good idea to start making a savings plan to help you reach your aim.
Firstly, analyse your monthly budget and subtract your necessary expenses, such as mortgage payments, food, travel and household bills. This will enable you to assess how much you can save each month, and where you can make cutbacks.
What are your property resolutions for the year?