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[B1140]Buy Property With No Money

by James Grantworth, Jam

Buy to let investment properties may appear to be the easiest method of building a second income but it is important to bear in mind the long term implications of this kind of investment as without careful planning you may end up paying out more than you had initially anticipated. A buy to let property is generally regarded as a long term investment and the decision to purchase should not be taken lightly as it can take quite a long time to get your money back once it has been invested if you revert your decision. A buy to let investment should be regarded as a small business which requires the owner to take on various responsibilites and is accountable to entities like the tenant, the mortgage lender, the council and the tax office.

To know whether buy to let property investments are right for you or not, you need to ask yourself the right questions such as:

? Will I earn enough in the near future so as to take care of my monthly instalment commitments and other expenses in case I am unable to find a tenant who pays the desired amount of rent?

What if there is a slump in the property market? Will you be able to bear the losses to your capital investment?

? Will the buy to let mortgage loan affect my creditability; will I be able to apply and remain eligible for other types of loans in the future?

Before you sign on the dotted line, you also need to consider the various costs that you will be required to bear in case you invest in a buy to let property. For sure, you will be required to shoulder the costs which relate to buildings insurance of the property, ground rent, and service charges and letting costs. There is the ongoing costs of repairs and maintenance to the property which is the responsibility of the landlord since not many tenants would consider moving to a house in a dilapidated condition.

There are goverment regulations concerning fire and saftey codes for gas and electrical appliances so there are potential expenses which relate to the repair, maintenance and certification involved. You might also have to consider legal costs that might arise in case your tenant starts defaulting and refuses to move from your property.

Before making any decision, you need to carefully assess your current and future financial position if you want to achieve the best possible return from your buy to let property investments. Making a profit from buy to let property is not as easy as it may seem so it is best to conduct careful research before going ahead with the purchase.

The Common Law of property states that ownership of real estate is ownership of a bundle of rights. I never realised the full significance of the preceding phrase until I realised the importance of the other interests in land other than the obvious real estate related rights in the land. This article will highlight three different interests in property for us to consider in real estate investment when we next examine our property investments.

Firstly, spend some time considering the water rights. In farming and agricultural land, water is often a good resource. Imagine that you own vacant property on some land in the countryside, one thing that many landowners would consider doing is to give a licence to the adjourning farmers to gain the use of the water on the vacant land either through a well or some irrigation method. Always get a licensed water engineer to consider your water table and the relevant rules imposed by the state on the supply of water and get an attorney to fix the contract.

Secondly, assuming that you own property that have minerals such as oil or other profitable minerals under your property, you can sell the right to someone who is involved in the oil business. You want to learn all you can about the cost of selling such rights and possibly retain a percentage of all oil revenues. Get assistance in valuation and deal structuring from oil and gas attorneys and brokers who have a good feel of the market. You would note that some bankers set up oil trusts to invest in such properties and the rich invest in them to earn a monthly income and you can take advantage of such an investment opportunity if you find an oil field property or own one.

Thirdly, air rights are a valuable asset that you can sell over your property. In busy cities, where land is scarce, sometimes all the developer needs is the airspace over your present property to build over. For instance if you own a historical building and it cannot be demolished or if the land below is a vital installation to the city, then building over the real estate may be the only solution. Sometimes developers want to have a certain amount of space to sell so they may want to build over your property so as to meet that criteria or build a ring of hotel properties in an area. An example of a good use of air rights was seen when Donald Trump built his skyscraper hotel over the Grand Central Station in New York.

In conclusion, take a closer look at the next real estate investment property that you purchase today and examine it if there are any additional rights that you can sell. Making money in real estate requires a creative mind and business acumen. Learn all you can about real estate investment today and start looking for your next real estate bargain.

Article Source : Pg. 5

About Author

Both James Grantworth & Joel Teo - are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

James Grantworth has sinced written about articles on various topics from Finances, Property Guide and Finances. James Grantworth is the marketing director for Let Mortgages Limited, a company which specialises in for investors offering buy to let mortgages whi. James Grantworth's top article generates over 165000 views. to your Favourites.

Joel Teo - has sinced written about articles on various topics from . Joel Teo runs a real estate investing website. Make money with the tips in the at. Joel Teo -'s top article . to your Favourites.