Camping itself may not seem like the biggest earner on the block, but if your land or garden is located in a prime position and can offer more than just the basics, it can be a worthwhile avenue to explore.

You don’t have to have masses of space available – small, more personal spaces can be more appealing to some people than a massive sprawl of campers – but you will need to consider what facilities you’ll provide and the all important issue of access to the site.

Land located in key tourist spots are, not surprisingly, really popular with campers, but your land doesn’t necessarily need to be in a tourist area to do well. If you get your business hat-on and think creatively, there may be opportunities to cash in on timely annual events, or major sporting events, where people need accommodation close by for a short period of time and will pay for the convenience and location. 

For example, in the same way that properties can be let for a short-term basis during major events and festivals, so too can land be let out to campers. Think music festivals, literature festivals, sporting events (horse racing, Wimbledon, football, rugby – even the Olympics), gardening or flower shows.

If you want to give it a go and test the waters to see if it’s a worthwhile sideline for you or to find out if it’s going to be too much hassle, then organisations such as Camp In My Garden are a great help for trying it out. The website is free to join and list your temporary private garden campsite and it could prove to be the gateway to a new property and land investment money-maker!

We’ve previously discussed the benefits for property investors and buyers of using information gleamed from sources such as Google Maps, Google Earth and Ordnance Survey data, and there are benefits to be had of using police data too.

The Police.uk site focuses on reporting local crime and you can access information that tells you how many crimes have been reported in a certain area each month and maps showing you where each type of crime has been committed.

It’s the street-level detail which can be really useful to a property investor. When you’re researching property that you’re interested in buying, it’s a good idea to look at all the issues that may affect the price of the property and crime in a particular location can have a negative effect on property prices.

It can also affect who might want to live in the property and, if it’s in a high crime area, then it could put off some prospective tenants.

The site is very easy to use – you should pop in a postcode, town or village name, or street name, hit the search button and, voila, the results pop up.

If you need more convincing of how beneficial it can be, then have a look at this post by property developer, Sam, as it illustrates how useful checking the crime stats in an area can be and how sometimes, the results can be surprising.

When you’re purchasing a property as an investor who is making a conscious business design, with an aim to making money, it’s important that you do so with your ‘head’ rather than your ‘heart’. For first time property investors, it’s all too easy to lose focus and get too emotionally involved with the purchase and the project.

We’ve all no doubt seen cases like this on the popular property TV programmes, where someone buys a property to do up and rent out, but rather than decorating it to suit the needs of future tenants, they can’t help but resist adding what they’d choose to have.

It’s easily done, especially when you’re investing significant amounts of time and money into bricks and mortar. But when your key aim is to make money and run a property investing business, there really is no time to let your heart rule your head. Getting emotionally involved with a property isn’t recommended, especially not where the interior decoration or furnishing are concerned.

When a property is intended to be let out, or sold, then keeping the needs of your  target market tenants or buyers in mind at all times is essential. It makes good business sense and, if your business is going to succeed, then you need to keep focused, keep your goal and aims at the forefront of your mind and remember to use your head, not your heart.

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Property investing mistakes, part 3

Property investing mistakes, part 2

Property investing mistakes, part 1

We’ve already looked at the issues of not being businesslike in your approach as a property investor and of not researching the area properly before you buy. This time we’re looking at the mistake of not setting a budget.

Whenever you’re making a property purchase, getting the finance right is crucial. In order to make it worth your while investing in property, the price you pay has to be within your budget and ensure you’ll make a profit if you’re going to do it up and sell it on, or provide a decent rental yield if you’re planning on renting it out.

If the figures don’t add up, or you over-spend to start with, you won’t make money on your property purchase.

It sounds simple, but some new investors still don’t set a budget when they first start looking for property. It’s easy to be swayed by nice looking houses in good areas, or get carried away at a property auction and spend too much, but you need to learn to follow your head more than your heart and think logically and sensibly about how much you can realistically spend.

So before you get carried away, do your research, check your finances, arrange a mortgage and get a budget clearly fixed in your mind. Then you just need to learn to stick to it!

For more details about the importance of rental yield, see
http://www.investment-properties-for-sale.co.uk/2010/09/what-is-rental-yield-and-why-is-it-important/

Chancellor Alistair Darling has delivered his last budget before the General Election, but after much anticipated waiting to see what it would hold, sadly the needs of landlords have been largely overlooked.

The big property news was that the threshold for Stamp Duty Land Tax would be increased from £125,000 to £250,000, for two, but that it would only be applicable for first-time buyers. Although it’s definitely good to give first-time buyers a helping hand onto the property ladder, many other buyers are feeling left out of the loop.

In fact, the outlook for some landlords may not be looking too good. A new 5% rate of Stamp Duty Land Tax will be introduced in 2011-2012 for property transactions costing over £1m. Although at first glance, most landlords may look to be unaffected by this, it looks like it will apply to both individual property purchases (e.g. expensive homes) and the purchase of property portfolios.

For any landlords or property investors thinking of buying property in bulk to form a new portfolio could find their purchases attracting much higher Stamp Duty tax bills in the future.

The budget also discussed changes being made to the way in which Local Housing Allowance (LHA) rates are calculated. The market areas used to work out the rates of LHA are going to be adjusted, which will remove the properties with the highest rents.

What do you think of this year’s budget? Are you disappointed that there’s nothing more positive for landlords?

The idea of buy-to-let is pretty self-explanatory – you buy a property at a good price and let it out to tenants, giving you a regular income on the property. Not only that, but the hope is that when you come to sell, the property will have risen in value, giving you a tidy profit. It might sound easy – and this has surely tempted many people to have a go at buying-to-let – but it’s not always as simple as that.

For example, there’s the small matter of finding the right property to buy and getting it at an affordable price. Any old property won’t do – you have to select the right type of property, in the right area and market it towards the right type of people in order to stand a chance of being successful. If you get any of these factors wrong, you may find yourself stuck with a property that you can’t rent out, which will be costing you money. This is the point at which many hopeful, or amateur landlords, get disheartened and give up on the idea.

Serious investors, however, are usually more aware of the importance of market factors and, in theory, should have done more research before purchasing a buy-to-let property. They’re not immune from the odd buy-to-let purchase mistake, but are usually more prepared to learn from their mistakes and move on to the next investment.

As well as describing a type of property purchase, the term buy-to-let is often used for a type of mortgage option. In the height of the property surge, buy-to-let mortgages were very widely available, with many great deals available to tempt people. Although still an option, the choices have somewhat narrowed, but this has helped weed out the ‘having a go’ investors, and given more room to the serious buy-to-let property investors.

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A to Z of Property Investing: A is for Appreciation

In the property investing world, appreciation refers to the positive effect that occurs when you invest in a property that goes up in value over time. It should be the goal of all serious investors to try and achieve good appreciation on their properties, not least as it increases the chance of making a profit when the time comes to sell.

The appreciation factor isn’t something that can be controlled easily – if only it were – but you can increase your chance of getting a property that will appreciate by putting careful thought into your property purchases. Some of the market factors that influence appreciation include supply and demand. As our property hotpot series has been exploring, buying in certain areas can help harness the demand for your property, if it’s in an area that is particularly popular and where there’s currently an undersupply for rental homes.

Inflation can also help property prices appreciate over time and so too can making improvements to your property. These need to be weighed up carefully, to ensure that the improvement will add long-lasting value and they’re particularly beneficial if you can also add extra value for rental purposes too. Improved bathrooms, kitchens and extensions are all common improvements that can make a significant difference.

Overall, if you’re a serious property investor, then the issue of appreciation should be firmly on your radar and you should keep aware of market factors when making business decisions.

John Healey, government Housing and Planning Minister, recently announced details of various new plans and legislation that will affect landlords, including the news that landlords will soon require planning permission to turn a residential property into an HMO (house with multiple occupation) with three or more unrelated tenants living in it.

Under the current legislation, you only need to obtain planning permission from your local council if the property will have six or more tenants living in it. Whilst the idea is that it will help give more control over unregulated changes and improve standards for tenants, it may not be quite such good news for landlords, especially as they’ll be more paperwork and waiting involved.

The new legislation is due to come into force by April 2010 and will affect any new plans to change the use of a property and turn it into a new HMO. Local planning offices are often already busy, so applications could take a while, which may deter some investors from going down this route.

If you’ve already got an HMO property, then this is unlikely to affect you, but would it put you off plans to opt for HMO properties in the future? We’d love to hear your views.

Pay your credit card bill in full each month

One of the issues your credit score is ranked on is how efficiently you pay off your any existing credit, such as your credit card bill. Paying the full amount off each month, and doing so on time, will help boost your credit rating and show that you’re responsible with the money you have.

If you’re prone to forgetting to pay your bill on time, or are frequently travelling when the bill arrives, then the easiest way of paying it off on time every month is to set up a direct debit payment for the full amount.

Likewise, it’s best not to spend over your credit card limit, as it gives the impression that you can’t live or spend within your means.

Get listed on the electoral roll

Being listed on your local electoral roll can play a positive part in helping you get credit. If you’re unsure if you’re listed, contact your local council to check and, if your name isn’t down, get it on the list. Although the council do send out forms about once a year, if you’re keen to get going with improving your credit rating, it’s better to get on with it, rather than wait to be asked.

Space out applications for loans

If possible, try not to apply for lots of loans or credit at once, as details of all your applications will come up in your credit rating file and it can affect your score. This covers anything from mortgage loans and car insurance, to credit for buying large electrical products or mobile phones.

Maintain a fixed address and phone number

Having a fixed home address and a home phone number, rather than giving a mobile number, can also boost your credit score. If you have moved house a lot in recent years, then don’t try and hide it – be honest about your previous addresses.

In the past, when buy-to-let mortgages were easier to come by and often given according to the proposed rental income from a property, your credit rating may not have played such a big role, but things have changed. For those applying for a buy-to-let mortgage in the current economic climate, more attention is paid to your credit score and this can affect the outcome of your application.

Credit scoring systems are used by companies such as banks, credit cards, insurers, mortgage lenders or insurers to rate and predict your behaviour. Although it’s often assumed that there is one universal credit rating list in the UK, this isn’t the case. There are in fact three main credit reference agencies, namely Experian, Equifax and Callcredit, and all three hold information about you. What’s more, the information may differ.

If you’re thinking of applying for a buy-to-let mortgage in the near future, or any other type of loan, then it’s useful to get an idea of what your credit rating, or credit score, not least as sometimes incorrect information can get on their files.

If you have a check done, then it is recorded on your file, but no lenders will be able to see this information and it won’t affect any loan applications you make.

It can sometimes take time to get the results through, so best not done in a rush, but as it could make the difference between being able to buy the property you want to invest in, or losing out on it, it’s worth it. Plus, if they turn out to have incorrect information on their files, you’ll have the chance to get it corrected, which could seriously help your loan application.