The objective of investing in property is to benefit from the potential capital gains and rental income that a buy-to-let investment could produce. It’s this money that will transform your life. It’s going to provide the finances to pay for the lifestyle you desire. It never ceases to amaze and dismay me how many investors don’t approach property investment professionally. I don’t want you to make the same mistake.
In this article, you’ll learn how to eliminate emotions from your investment decision-making. Instead of treating property investment like an amateur, you will make wiser choices and bigger and better profits.
The time to eliminate emotions from your investment psyche is from the very first moment you realise that property investment is the right route for you. This is going to be difficult.
Investing – the act itself – is a process. Though in many ways it is like buying a home, it is also very different.
For example, the mortgage process is different. You must finance with a buy-to-let mortgage, and not a homeowner mortgage. Lenders must assess financial viability against rental income. Affordability will be measured at an interest rate set by the Prudential Regulatory Authority. This rate will be above the actual mortgage interest rate the lender charges you.
You should prepare early for property taxes. There are expenses and costs that you can use to reduce the tax you pay, but the changes to the way that buy-to-let mortgage interest payments are treated mean that you must consider how to structure your investment. For many people, setting up a limited company to invest in property can improve profits by reducing tax liability.
After you’ve made the investment, you will be faced with a whole new business issue: you now own a buy-to-let property. Now comes the hard work!
Could you do all of this successfully? Me neither. Which is why I use an investment property manager to manage all my properties. No hassle. My time remains my own. And I can offset their charges against my rental income to reduce my tax liability.
In summary, act like a professional investor from first to last and beyond. Build a network of competent and experienced professionals to aid you. Remove emotions from your decision-making at every step, and your property investment should reach its full potential.
In my next and final article in this series, I’ll wrap up by summarising the seven things to consider before investing. Meanwhile, if you’d like to discuss your lifestyle goals and how property investment could help you achieve them, book a property investment strategy consultation by contacting Gladfish today on +44 207 923 6100.