However, with many more new investors entering the market there is a major issue with the way property investments are being offered.
The hot term used by most "internet based property investment groups" is BMV (below market value). Buyers are offered distressed sale properties with supposed hefty discounts (15-25%) from their "market value" with the promise that they'll deliver a quick flip on their investment.
The problem with BMV is two-fold:
1. The distressed sale properties are distressed for a reason. Either they are at risk of being repossessed, are in areas with falling demand, or they are a failed investment for a previous buyer where the numbers have not stacked up.
Why would anyone want to consider buying an investment that has already been proved not to work?
2. BMV is actually a myth. A property is only worth what someone is prepared and able to pay for it so the BMV price is in fact the true value. The fact that the property investment group may have comparables of other properties that have fetched higher values is irrelevant.
So by buying BMV not only are you potentially buying someone else's cast-offs, problem property or failed investment you are also paying the true market rate for that property, or sometimes more if the investor doesn't do their due diligence.
Problem properties and failed investments could also seriously affect your ability to generate an income from the property, as the only tenants you are likely to attract are those paying the lowest possible rents as the property is in distressed areas (eg a block of flats that are largely empty).
With so many internet-based property companies offering BMV as their main sales pitch these issues may befall hundreds if not thousands of buy to let investors if they are not brought to light now.
Now there is a better way to invest in Buy-to-Let
We see a way of making the buy to let sector much more transparent and credible. The boom and bust of the early 2000s resulted in thousands of buy to let landlords losing the value of their equity (and many their life-savings).
This can't be allowed to repeat itself and an alternative, transparent and more guided way of investing in buy-to-let properties is now essential.
Step forward the Buy to Let Centre. Not internet-only (like other companies) but in fact 65 high street based branches across the UK located within leading independent estate agents and lettings agents.
The Buy to Let Centre was founded by industry experts Tim Hammond and Richard Rawlings and is run alongside their Homebuyer Centre branch network.
Whilst other companies focus on seminars, schemes and secret strategies, Buy to Let Centres focus on local area knowledge, local property market expertise, and independent and impartial advice.
Hammond says:
"We start with your requirements, demonstrate realistic returns and provide expert opinion and advice on the best and most credible buy to let and property investments on the property market."
"Our High street branches enable you to invest anywhere in the UK and our local experts manage the property sourcing, lettings and management for you. We will help you acquire high yield properties in areas with strong tenant demand and maximise the return on your investment.
"Access to every property in the UK means you can be assured of independent and impartial advice."
Buy to Let industry expert, Kate Faulkner comments:
"Too often I see buy to let investors fall for unrealistic claims of "below market value", achieving "financial freedom" and hoping to "become a property millionaire" with little money and in a short time, which is unrealistic.
Buy to let is a long term investment and it's essential people have the right strategy to meet their objectives. They need to seek local expert advice on house prices and rents and take time comparing property deals from an investment perspective.
During this difficult market, successful buy to let is possible, but you need to work with property professionals on the ground who have a reputation to protect and are motivated by your long term success rather than making a quick buck from flogging you deals."
Expanding throughout the UK
Hammond's plan is to open "Buy to Let Centres" across the UK in addition to their existing network of 65 Homebuyer Centres who will also operate as Buy to Let Centres.
Hammond says:
"Our mission is to become the one stop shop for the Buy to Let Investor with high street branches nationwide.
"From pinpointing the best areas or sectors to invest, sourcing and negotiating on the best investment properties, lining up tenants and managing and growing your portfolio, the Buy to Let Centre is the ideal solution for new property investors and existing landlords."
Whether you are looking to invest in one property or generate income for your retirement from a property portfolio it makes sense to ditch unrealistic property investment group claims or BMV and speak to your local Buy to Let Centre to get on the right path for your property investments.
