Whether your looking to register your property business as a UK Ltd Company or expand your existing business empire, we’ve listed some great articles on things such as how to set up a Limited Company, the importance of getting business insurance , tips on how to run a property business and much more.
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Property sourcing refers to the process of finding and identifying suitable real estate investment opportunities on behalf of property investors. Property sourcers, also known as property finders or deal sourcers, act as intermediaries between investors and potential properties. What Are The Benefits Of A Property Sourcer?
Expertise and Local Knowledge...
1. Traditional Buy To Let - The most common property investment type, traditional buy-to-let involves investing in a property with the intention of finding tenants to live in it. The rent should ideally cover any mortgage borrowing and other costs. This strategy is normally a medium to long-term investment, with returns made through the rental income..
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A Limited Company is a type of business which exists as a separate legal entity to its owners. Everything that the company owns, owes and earns is totally separate from the personal assets of the business owners. It’s called a Limited Company because liability is limited.
Limited liability literally means that any liabilities, such as debts, are limited. This...
If you are thinking about getting into real estate investing, congratulations! Done right, it can be a wonderfully rewarding and exciting initiative that can set you and your family up with a solid income stream.
Of course, you will need to do your homework on the different types of property investment and the tax implications of each. To start you off, here are...
As a property investor, continuous learning and expanding knowledge should be a top priority. While experience is often the best teacher, reading books written by experts in the field can help accelerate your learning curve and expose you to new ideas. To help maximise your investment property education, we’ve compiled a list of the top UK investment...
READ MORE
The Property Investment Industry is growing at a phenomenal rate and sometimes it can be hard to keep up and navigate the industry when it comes to the latest requirements, news, software and idea’s - generally speaking a way to move your property business forward.
We launched www.savvypropertyinvestor.com as an online resource for those in..
Do the terms used in home buying, selling and renting sound like a different language to you? Use our handy jargon buster and you'll be on top of your property A-Z in no time.
When it comes to buying, selling or renting a home, the last thing you need is to battle through a blizzard of unfamiliar words and phrases. But our property jargon buster is here...
What Is Property Sourcing?
In this article we’ll go through a very basic explanation as to what property sourcing is – we’ll post a fully comprehensive explanation in a future article.
So What Actually Is Property Sourcing?
Property sourcing refers to the process of finding and identifying suitable real estate investment opportunities on behalf of property investors. Property sourcers, also known as property finders or deal sourcers, act as intermediaries between investors and potential properties.
What Are The Benefits Of A Property Sourcer?
Expertise and Local Knowledge: Property sourcers have in-depth knowledge of the local real estate market. They know which neighborhoods are up-and-coming, where to find undervalued properties, and which areas offer the best investment potential. This expertise can save clients time and help them make well-informed decisions.
Access To Off-Market Deals: Many excellent real estate opportunities are not listed on public databases or marketplaces. Property sourcers often have access to off-market properties through their network of contacts, giving their clients access to deals that others might miss.
Time Savings: Searching for properties can be a time-consuming process, especially for those with busy schedules or limited familiarity with the market. A property sourcer can handle the legwork, narrowing down options that match the client’s criteria, and presenting them with suitable choices.
Negotiation Skills: Experienced property sourcers are skilled negotiators. They can negotiate with sellers to secure the best possible price and terms on behalf of their clients, potentially saving them money in the process.
Reducing Risk: Property sourcers conduct due diligence on properties to ensure there are no hidden issues or potential risks. They can help clients avoid problematic properties and minimize the chances of making a bad investment.
Tailored Investment Strategies: Property sourcers work closely with their clients to understand their investment goals and risk tolerance. They can recommend properties that align with the client’s investment strategy, whether it’s buy-to-let, fix-and-flip, or long-term appreciation.
Network of Professionals: Property sourcers often have a network of professionals in the real estate industry, including mortgage brokers, solicitors, property managers, and contractors. They can refer clients to reliable professionals who can assist in the purchasing process or property management.
Geographic Flexibility: For investors looking to diversify their portfolio across different regions or countries, property sourcers can provide valuable support in unfamiliar markets, bridging the knowledge gap and facilitating cross-border investments.
Investment Support: Beyond just finding properties, property sourcers can provide ongoing support and advice throughout the investment process. They can assist with rental management, property maintenance, and strategies to maximize the return on investment.
It’s important to note that while property sourcers offer many benefits, it’s crucial to choose a reputable and experienced professional to ensure the best possible outcome. Conduct research, ask for references, and review their track record before engaging their services.
What Is A Sourcing Fee?
A property sourcing fee is a fee charged by property sourcers or property finders for their services in identifying, researching, and negotiating property investment opportunities on behalf of their clients.
The property sourcing fee is typically paid by the buyer or investor and can be structured in different ways. Some common approaches to property sourcing fees include:
Flat Fee: The property sourcer charges a fixed amount for their services, regardless of the property’s purchase price or the level of effort required to find it.
Percentage of Purchase Price: The fee is calculated as a percentage of the property’s purchase price. This approach incentivizes the property sourcer to find higher-priced properties that align with the client’s investment goals.
Commission-Based: The property sourcer receives a commission from the seller or the seller’s agent. This model is less common and may raise potential conflicts of interest, as the sourcer may prioritize deals with higher commissions rather than those that best suit the buyer’s needs.
Retainer Fee: The buyer pays an upfront retainer to engage the property sourcer’s services. Additional fees or a percentage-based commission may also be agreed upon once a suitable property is found and successfully acquired.
The specific amount of the property sourcing fee can vary based on the level of service provided, the complexity of the property search, the local real estate market, and the terms negotiated between the property sourcer and the client.
It’s essential for both the property sourcer and the client to have a clear understanding of the fee structure and the scope of services included in the agreement. Additionally, transparency about any potential conflicts of interest and how the sourcer is compensated is crucial to maintaining a trusted and ethical relationship throughout the property sourcing process.
What Is A Sourcing Fee?
The amount a property sourcing agents charges will vary widely depending on several factors, including the location, the level of service provided, the complexity of the property search, and the individual property sourcer’s pricing structure.
Generally, property sourcing fees in the UK can range from a few hundred pounds to several thousand pounds. Some property sourcers charge a fixed flat fee, while others may charge a percentage of the property’s purchase price as their fee.
Is Your Property Sourcing Business FULLY Legal And Compliant? - Click Here To Find Out
What Are The Different Types Of Property Investment?
1. Traditional Buy To Let
The most common property investment type, traditional buy-to-let involves investing in a property with the intention of finding tenants to live in it. The rent should ideally cover any mortgage borrowing and other costs. This strategy is normally a medium to long-term investment, with returns made through the rental income as well as the future sale of the property for a profit where applicable.
There are many factors to take into account, including stamp duty costs, management fees if you won’t be managing the property yourself, running and maintenance costs and finding and dealing with tenants. Almost any residential property can be used as a buy-to-let provided it meets all the required standards, but it is important to choose the right buy-to-let property investment for you.
2. Build To Rent
Build-to-rent properties are those that have been specifically designed for renters rather than owner-occupiers. They offer a solution to the rising demand for high-quality rental housing to reflect the needs of today’s renters. Build-to-rent developments tend to have more of a focus on services such as on-site management, amenities, and shared spaces such as work zones, fitness centres, creches, and outdoor space.
They are a popular investment type for institutional and individual investors, and often come with the option to be fully managed by a management company, sometimes with guaranteed annual yields.
3. HMOs
Houses in multiple occupation (HMOs) are properties that have at least three tenants living there forming more than one household (eg. members of more than one family), and have shared toilet, bathroom or kitchen facilities with other tenants. Large HMOs are properties that have at least five unrelated tenants living there, and have shared toilet, bathroom or kitchen facilities. Since 1 October 2018, all large HMO properties require mandatory licences, while many smaller HMOs now fall under selective or additional licensing schemes. Check with your local authority for more information. HMOs are a popular investment choice as they can provide higher than average yields, although they can be more expensive from the outset and require more management than a non-HMO.
4. Off-Plan
Investing in a property before it’s been built, known as off-plan, has become an increasingly popular way for both individual and institutional investors to achieve greater returns.
One of the major plus-sides is that the value at which you secure the property at the preliminary stage is likely to have increased by the time the development is completed, meaning the potential for capital appreciation is much higher than buying traditionally. Some projects are even offered at discounts of up to 5% for early investors, while the added bonus of getting in early is that you can be more selective about which property or plot you choose.
Some developers offer buyers and investors the chance to personalise their units with fixtures and fittings. They can also provide furniture packs at an extra cost, meaning the whole property comes furnished on completion and ready to be tenanted.
5. Furnished Holiday Lets
This type of property investment has a different focus to long-term rental properties, as they are only rented out for part of the year. Choosing the right location is probably one of the most important factors, as your target market will be both UK and international holiday-makers. Furnished holiday lets can provide extremely high returns as the daily or weekly charge is significantly higher than traditional buy-to-let. There are also potential tax advantages that may be applied, as they are classed as a business, meaning you can often claim certain expenses. However, they may come with added maintenance and running processes to take into consideration, due to the high turnaround of customers compared to buy-to-let, which is something that should be factored in. To qualify as a furnished holiday let, it must be available for at least 210 days a year, and rented commercially for at least 105 days a year.
6. Freehold Or Leasehold
The majority of houses in the UK are freehold, which means you own the property as well as the land it sits on, and you are solely responsible for its maintenance. Some freeholds are shared – for example, where at least half of the leaseholders in a building have agreed to buy the freehold between them to take control of the building and its costs. However, more recently, some new-build houses have been sold on a leasehold rather than freehold basis, so homebuyers need to make sure they find out what type of property they’re buying.
Owning a leasehold means you only own the property for the length of the lease agreement, after which point ownership returns to the freeholder. It’s vital to know how many years are left on the lease before you commit to buying, as for anything less than 70 years you might struggle to get a mortgage, and it can be difficult to sell a property with a lease of less than 80 years. With leasehold, you don’t own the land and won’t be responsible for running or maintaining the building if it’s in a block. However, you may share the costs of this with other leaseholders through services charges, ground rent, administration fees and buildings insurance.
7. Commercial
Commercial properties encompass offices, retail spaces, warehouses, and industrial units. They operate differently from the residential market and thus attract different kinds of investors.
The benefits can differ from those from residential investments. Commercial tenants often sign longer leases, sometimes spanning multiple years. This can secure a consistent revenue stream for the investor for a more extended period. Also, due to the nature of business, some commercial properties can command higher rents, especially in prime locations.
There is also the fact that commercial leases can sometimes place the responsibility of maintenance or repairs on the tenant rather than the landlord, depending on the agreement.
On the risk side of the equation, commercial properties can require a more substantial outlay of capital to acquire than most residential properties. In addition, the profitability of commercial tenants can be closely tied to the economy. An economic downturn can result in business failures, translating to property vacancies. There is also the fact that commercial property agreements can be complicated, potentially leading to disputes if not appropriately managed.
Top 13 Property Investment Tips For Beginners In The UK
If you are thinking about getting into real estate investing, congratulations! Done right, it can be a wonderfully rewarding and exciting initiative that can set you and your family up with a solid income stream.
Of course, you will need to do your homework on the different types of property investment and the tax implications of each. To start you off, here are our best tips on property investment for beginners in the UK.
Buying An Investment Property: What To Consider
Property investment for beginners in the UK requires a thorough understanding of the pros and cons as well as the kind of legal liability you are taking on. There are three main criteria you want to remember:
1. Location
“Location, location, location” is a popular refrain in the property business for a good reason. Some things to take into account when evaluating the merits of a location include:
2. Property Type
Investing in buy-to-let apartments or flats is a good way to test out property investment for beginners. However, you can take into account several other property types, which might even be more lucrative for you, depending on where you live. These include:
Remember, however, that the tax implications for these types of property investments can be quite cumbersome. So be sure to consult an accountant at every step.
3. Yield
You are getting into property investment for the money, so you want to ensure you get the most returns.
A simple way to see how much you are likely to make is by calculating the property’s potential yield, which shows the annual rental income as a percentage of the property’s total value.
Looking for a steady rental yield, rather than increases in the property’s value itself, is generally a good idea when it comes to property investment for beginners.
Properties with optimum locations (as discussed above) will likely give you better rental yields.
13 Tips For Property Investment For Beginners
Getting into property investment as a beginner can feel daunting at first, so having a clear plan and the right mindset is essential. Here, we have rounded up the best pieces of advice from the experts on getting into property investing:
1. Have Clear Goals
Why exactly are you interested in property investment? Before you start, set down your exact objectives and priorities, including:
3. Do Your Market Research
Before getting into property investing, it is important to have a good understanding of what property prices are like and what the market trends are. Plenty of data is available online, so set aside some time to understand how prices and rents work.
4. Have A Clear Budget (And Stick To It)
One cautionary note regarding property investment is that costs can add up faster than you think. To avoid that, set a budget in advance and have a plan for sticking to it. Things you will want to consider include:
A good rule of thumb is to underestimate your income and overestimate your expenses. That way, you are less likely to fall short.
5. Get Advice From The Experts
Particularly, if you plan to borrow money for your property investment, it is a good idea to talk to a broker or independent financial advisor first.
They can give you tips on the best and most cost-effective financing option for your property, be it a loan, mortgage, venture capital or peer-to-peer finance. In addition, get in touch to learn about the most tax-efficient options for starting a rental property business.
6. Do Your Due Diligence
This means doing your homework on the property you plan to invest in. You will want to verify any facts you have been given about the building and also visit the location to ensure that it is as advertised.
7. Buy Below Market Value Whenever You Can
“Below market value” means lower than the price the property would sell on the open market. By opting for this, you increase your chances of making a profit whenever you choose to sell your property.
8. Add Value To Your Property
When you add value to the property you invest in, you make your current renters happier and generate extra capital gains. Value adds can include:
9. Diversify Your Portfolio
Property investment for beginners – and indeed for everyone – should involve some degree of diversification. It lets you hedge your bets to keep making money from some properties even if others slow down. Options for diversification include:
10. Bear The Risks In Mind
It is always important to know what you are getting into with starting a rental property business, and it certainly is not all rosy. Some problems you could potentially run into include:
12. Always Think Long Term
Property investment will not bring you instant yields. In fact, property prices might even fall year-on-year. But do not be discouraged! In the long run, property prices tend to appreciate so when you enter this space, have a timeframe of at least 10-20 years in mind.
13. Be Prepared To Evolve If You Have To
The property market in the UK is evolving, just like any other market. Remember to keep a finger on the pulse, watch for price trends or external factors that could affect the value of your property, and be ready to pivot your strategy if you have to.
10 Advantages Of Setting Up A UK Limited Company
What Is A Limited Company?
A Limited Company is a type of business which exists as a separate legal entity to its owners. Everything that the company owns, owes and earns is totally separate from the personal assets of the business owners. It’s called a Limited Company because liability is limited.
Limited liability literally means that any liabilities, such as debts, are limited. This means there’s less risk to the people who own and run the company, and that their personal assets are safe if the company fails.
It's Not Difficult To Set Up A Limited Company.
If you ask most people how you’d go about forming or setting up a Limited Company, chances are they’d stare back at you blankly. A common misconception is that incorporating a Limited Company is some kind of bureaucratic obstacle course that can take months and cost thousands of pounds.
One of the biggest benefits of incorporating as a Limited Company is that it’s a relatively straightforward process that comes with lots of advantages. This is perhaps one of the most compelling reasons for opting to register as a Limited Company. It is also intended to be that way, in order to encourage entrepreneurship. A Limited Company can have one employee (yourself as the Director) or an unlimited amount of employees.
You can incorporate a Limited Company online in less than ten minutes – find out more at the end of this article.
Protecting Your Name And Your Brand
Once your company name is registered with Companies House, it is legally protected. This means that your business name can’t be used by another company, which helps to protect your brand from incidents like brand copying or imitation. A sole trader’s business name does not enjoy this protection. Waiting to register your company could mean you lose the name you had initially wished to trade under.
Sole traders and partnerships will not necessarily have a unique name, whereas there can only ever be one active UK Limited Company with any particular name. Once you’ve registered a company with Companies House, your new company name is protected and no-one can use the same name or even a name that’s too similar.
Dormant Companies Can Be Set Up
A Limited Company does not have to trade to exist. It can be dormant, which means you can register your company to protect your business/brand name. This can be useful if you have an idea and a name for a business but not yet the time or capital to develop it.
You’ll need to register the name and maintain the necessary formalities to keep the company on the register. However, these requirements are somewhat easier to meet than those for other companies.
Join ‘Club Limited’
One way to be taken seriously as a business is to form a Limited Company and get the word ‘Limited’ or ‘Ltd’ at the end of your business name.
If you don’t have ‘Ltd’ or ‘Limited’ at the end of your business name, you are recognised by everyone as a sole trader or unregistered company. Sometimes unfortunately, that is a tell-tale sign of being a small, micro-business that, while affordable – is a higher risk to deal with.
Ok, let’s ask ourselves a question: Are all big and established businesses trading as Limited Companies? The simple answer is yes. Unless of course, they are LLPs – in which case, they are still registered with Companies House.
Credibility & Prestige
The formation of a Limited Company can suggest that the business has permanence and is committed to effective and responsible management. It gives both suppliers and customers a sense of confidence.
Many companies, particularly larger organisations, will not deal with a business that’s not a Limited Company. Forming a Limited Company can therefore open up new business opportunities that wouldn’t otherwise be available. Often, the extra accounting and reporting requirements that apply for Limited Companies are worth it in terms of extra opportunities.
Easier Access To Business Loans & Finance
The separate legal entity of a Limited Company makes it slightly easier to secure business loans and finance to help grow your business than sole traders. Also, companies can raise capital by issuing new shares to shareholders and new investors - to anyone, really, except Joe Public (only public limited companies can do that). On the other hand, sole traders have to raise new capital from their personal resources. If they happen to be cash-strapped at the time, that’s pretty much that.
Professional Status
Your professional status and image will improve considerably when you start trading as a Limited Company. Whilst the activities, ownership structure, and internal management of your business may be the same as when you were operating as a sole trader, companies are held in much higher regard and create a better impression.
The difference in perception stems largely from the fact that incorporated businesses are more rigorously monitored. Limited Companies have more complex accounting and reporting requirements, their statutory compliance obligations are much greater, and their corporate details and accounts are published on public record where they can be inspected by other businesses and members of the general public.
A more professional image, coupled with the benefits of corporate transparency, could also benefit your business in many other ways, such as:
Personal Assets Are Protected
Your liability is limited - While many turn to a Limited Company for the tax benefits, some would argue that the peace of mind that comes with it is just as important.
We all know that risk comes with the territory when you run your own business. However, there are ways to minimise your risk as a self-employed person. With a Limited Company, you’re protected from any debts the company may incur should your business become insolvent.
Limited Companies are their own legal entities; from a legal standpoint, the individuals that make up these companies are not deemed personally liable for the debts of the company. Your responsibility for your company’s debt is capped at the number of shares you own in that company.
Imagine you’re running a Limited Company, and you have a share capital of £100.
You decide to take out a loan of £5000. However, things take a turn for the worse and you’re unable to keep up with payments.
If your company continues to defer on the loan payments, your company will be charged with non-payment of the interest on the loan, and non-payment to your creditors. In line with the law, your company will be dissolved - but you’ll only be liable for the number of shares you hold. In this case, that amounts to £100.
Do note that there are exceptions to this rule.
If you’ve signed a personal guarantee, or if your creditors lose money due to fraudulent activities you've carried out as the company director, your liability won’t be capped, and you will be personally liable for the debt.
By contrast, sole traders do not enjoy the same protection. If you run into trouble as a sole trader, your liability is essentially uncapped. This could put all your personal assets at risk.
You Pay Less Tax And National Insurance Contributions
Who can turn their nose up at the prospect of increased take-home pay?
Well, that’s the principle benefit of setting up a Limited Company, and one of the main factors that drive people to switch from a sole trader.
As a director of a Limited Company, the way you pay tax is different from how you pay as a sole trader.
As a sole trader, you’ll pay 20% or more on everything you earn over the tax threshold. As a Limited Company, you typically pay yourself a small salary, so you incur as little personal tax as possible. The majority of your income will come in the form of dividends. These are taxed at a lower rate, which means you’re able to maximise your take-home pay.
In addition to the tax benefits, paying the majority of your income through dividends means that you’re able to pay less National Insurance contributions (NICs) as these do not apply to dividend payments.
Here’s a quick comparison of the difference in take-home pay for a sole trader and a Limited Company.
Sole Trader
Limited Company
In the above example, you'll save £965.64 if you're operating through a Limited Company.
So What Are You Waiting For?
With all that being said, now could be the perfect time to register your UK Limited Company and it can be done in minutes.
Become a Director of your own company - Register a Limited Company in the UK and open a business bank account, all in one go. Companies House (the government organisation where all UK companies are registered) now charges £50 to register your UK company – with Tide you can register your UK company for just £14.99. Apply within minutes, in one...
The Top 10 UK Property Investment Books
As a property investor, continuous learning and expanding knowledge should be a top priority. While experience is often the best teacher, reading books written by experts in the field can help accelerate your learning curve and expose you to new ideas. To help maximise your investment property education, we’ve compiled a list of the top UK investment property books.
These books cover critical vitals like finding deals, financing, management, tax strategies, etc. Reading them will provide a wealth of knowledge from authors with decades of experience that you can apply to your investment property business.
Whether you’re just getting started or have been investing for years, these books offer actionable advice and insights to take your business to the next level. Dive in and start reading to strengthen your foundation as a property investor.
The Top 10 Property Investment Books For Savvy Property Investors
In no particular order, here are our recommendations on ten expert-authored books to check out for an informed decision when investing in UK property developments:
Best Books for Understanding Property Investment Basics
The following essential reads will provide invaluable knowledge to build a solid foundation in property investment:
Property Investment For Beginners by Rob Dix (You Can Get It From Amazon Here)
Despite some ups and downs along the way, property has been one of the best investments of the last 20 years – and you’re convinced it could be your key to financial freedom. And it could. But where do you start? Do you invest near where you live, or wherever yields are best? Do you rent to families, or professionals, or students? Should you be trawling through Rightmove or lurking at property auctions? This short book covers the big questions you should be asking yourself before you so much as glance at an estate agent's window.
The Complete Guide to Property Investment: How to Survive & Thrive in the New World of Buy-to-Let by Rob Dix (You Can Get It From Amazon Here)
This practical investment property book outlines a step-by-step process for building a successful buy-to-let portfolio. Dix covers finding and evaluating deals, finance options, refurbishment, letting and managing properties, and exit strategies. With valuable tools and real-life case studies, Dix provides a comprehensive overview of becoming a landlord and profiting from rental income and capital gains.
The Complete No-Nonsense Guide to Becoming a UK Property Investor: The 1-2-3 on Property Investing (You Can Get It From Amazon Here)
This comprehensive book offers valuable insights and practical advice for individuals looking to venture into property investment in the UK. With a straightforward and no-nonsense approach, this guide takes readers through the fundamentals of property investing, providing a step-by-step roadmap to success.
Successful Property Letting, Revised and Updated: How to Make Money in Buy-to-Let by David Lawrenson (You Can Get It From Amazon Here)
This UK property investment book provides valuable insights and practical advice on investing in rental properties. The book is aimed at individuals interested in the buy-to-let market. It covers various aspects of property letting, including finding the right property, financing, tenant management, legal obligations, and maximising returns.
Multifamily Real Estate Investing by Morgan Lane (You Can Get It From Amazon Here)
This book emphasises the potential benefits of investing in multifamily properties as a pathway to financial freedom. The author provides insights into creating reliable monthly cash flow and outpacing inflation, with a particular focus on small multifamily properties. Lane’s approach is practical, stressing that you don’t need to reinvent the wheel to succeed, as 90% of the world’s millionaires have built their wealth through this very method.
3 Advanced Property Investment Strategy Books
To maximise returns, serious property investors utilise innovative tax strategies.
Here are three of the best books for property investment on this topic:
How to Save Property Tax by Carl Bayley (You Can Get It From Amazon Here)
This book reveals little-known tax strategies utilised by experienced property investors. It covers niche topics like capital allowances, land remediation relief, rollover relief, and stamp duty land tax mitigation. The complicated tax code contains many opportunities, and this book helps investors navigate them.
Property Magic by Simon Zutshi (You Can Get It From Amazon Here)
Zutshi’s comprehensive guide provides advanced techniques for sourcing deals, structuring win-win joint ventures, and scaling a buy-to-let portfolio. Using innovative property investment strategies, investors can generate income through property without needing significant capital. Needless to say, it’s a must-read for taking your investments to the next level.
Property Investor Toolkit: A 7-Part Toolkit for Property Investment Success by Richard WJ Brown (You Can Get It From Amazon Here)
An experienced property investor, Richard WJ Brown, breaks down the complex world of property investment into seven essential parts. In this guide, he outlines a step-by-step approach to building a profitable portfolio and transforming property into a passive income investment. The book covers essential topics such as market analysis, property selection, financing options, risk management, property management, and exit strategies.
Employing advanced tax strategies can significantly boost your profits. However, the UK property tax law is complex, and errors can be costly. In addition to our recommended property investment books in the UK, investors should seek professional tax advice to ensure full compliance — contact the Baron & Cabot team for more information on how we can assist you in this regard. When leveraged correctly, innovative tax planning can accelerate your journey to financial freedom through property investment.
3 Top Books On Property Investment By Experienced UK Investors
Several authors with years of experience investing in UK property have published indispensable books. These resources provide invaluable guidance for new investors.
Here are our top three picks on the best investment property books:
Buy Low Rent High: How Anyone Can Be Financially Free in the Next 12 Months by Investing in Property by Samuel Leeds (You Can Get It From Amazon Here)
Leeds teaches property investment strategies through online courses and live events. His book focuses on purchasing undervalued properties, improving and repositioning them, and maximising rental income. It’s an excellent resource for aspiring buy-to-let landlords.
How to Be a Landlord: The Definitive Guide to Letting and Managing Your Rental Property by Rob Dix (You Can Get It From Amazon Here)
This comprehensive guide offers valuable insights and practical advice for individuals interested in becoming landlords or managing their rental properties effectively. This book serves as a go-to resource for navigating the challenges and responsibilities of being a landlord.
Rent 2 Rent Success: Our Ethical 6-Step System to Get You Started in Property Without Buying It by Stephanie Taylor (You Can Get It From Amazon Here)
This valuable investment property book outlines a step-by-step approach to entering the property market without purchasing properties. This book offers insights into the Rent 2 Rent strategy, which involves renting properties from landlords and subletting them to tenants, generating cash flow that can be channelled into building a property portfolio.
Who Are Savvy Property Investor???
The Property Investment Industry is growing at a phenomenal rate and sometimes it can be hard to keep up and navigate the industry when it comes to the latest requirements, news, software and idea’s - generally speaking a way to move your property business forward.
We launched www.savvypropertyinvestor.com as an online resource for those in the property industry where they can easily access all of their essential property requirements on one website - from registering your property business as a UK Limited Company, getting business insurance to using property market intelligence software, taking a property investment course and much more.
Our full list of resources are on our home page and can also be accessed by clicking on the (Take Me To - Button) on the Home Page header.
We Hope You Find Our Website Useful And Wish You All The Best In Building Your Property Empire.
Property Jargon Buster
Do the terms used in home buying, selling and renting sound like a different language to you? Use our handy jargon buster and you'll be on top of your property A-Z in no time.
When it comes to buying, selling or renting a home, the last thing you need is to battle through a blizzard of unfamiliar words and phrases. But our property jargon buster is here to help you make sense of the terminology so you can sail smoothly through the process.
Acceptance - A document you sign and hand back to the mortgage lender to confirm you want to accept its offer.
Agreement In Principle (AIP) - A document from a mortgage lender that confirms it will lend you a certain amount based on your earnings and usually a credit search and credit score. An AIP will help prove to a seller you’re a serious buyer.
Annual Percentage Rate (APR) - Often misunderstood, an APR is the total percentage cost of the loan every year. So, that includes interest as well as any additional fees. APRs are a legal requirement when advertising financial deals like credit cards and mortgages.
Appraisal - An old-fashioned word meaning an estimate of a property’s current value according to an estate agent or surveyor.
Arrangement Fee - A fee charged by some lenders to cover the administration of arranging a mortgage. They often apply to deals with special rates, such as fixed rates or trackers.
Arrears - The amount of money that is overdue on your mortgage. If left unpaid it may result in the lender repossessing the property.
Asking Price - The price a seller is hoping to achieve for their home.
Assignment
The transfer of a right, title or claim to a property from one party to another.
Auction - Method of sale whereby a property is sold to the highest bidder. If the reserve price (the minimum the owner is willing to sell the property for) is not reached, then it remains unsold. Property auction beginners should do plenty of research, so start with our straightforward guide here.
Bank Rate - Interest rate set by the Bank of England every month (also known as base rate or simply interest rate). If the rate you pay on your mortgage is variable, it may be affected if the bank rate changes.
Bridging Loan - A high-interest temporary loan that offers short-term access to money, so you can buy a property before selling your existing home, for example.
Buildings Insurance - An insurance policy that covers any structural damage to your property from events such as a fire or flooding. If you need a mortgage, building insurance will be a condition of the loan. Find out more about what cover you need with our guide.
Building Survey - Formerly known as a structural survey, a Building Survey is a detailed report on the construction of a property. It’s the most comprehensive survey you can buy and is suitable for listed buildings, older or unusual homes or ones you intend to completely renovate. Check out our guide to find out which survey is right for you.
Buyer - Straightforward. The person who is buying a property (also known as the purchaser).
Buy-To-Let Mortgage - A mortgage designed specifically for buying a property that will be rented out, usually for investment purposes. You can read more about buy-to-let in our guide.
Capped Rate - The highest interest rate or ‘cap’ you will pay on your mortgage for an agreed period – usually the first few years of the loan.
Capital - The amount of money put into either buying a property or paid as a deposit.
Chain - Most people need to sell their current home to be able to afford to buy the next one, and the people they sell it to need to sell their home as well. This is what is meant by a ‘chain’ and if one link pulls out, the whole chain can collapse.
Charge - The ‘hold’ a lender has over the equity in your home. For example, if you owe £40,000 and fail to keep up repayments, you can be forced to sell your home to repay the debt.
Chartered Surveyor - A surveyor, accredited by the Royal Institute of Chartered Surveyors (RICS), who is employed to carry out a survey on a property.
Commission - The fee payable to an estate agent – typically a percentage of the property price.
Completion - Completion is when you can move in! The sale of the property is finalised and the legal transfer of ownership passes from one party to another.
Compulsory Purchase Order - Often referred to as a CPO, a Compulsory Purchase Order allows local authorities to purchase property regardless of whether the owner wants to sell. However, the CPO must demonstrate how the purchase would benefit the public and adequately compensate the homeowner.
Conditions Of Sale - Terms defined in the contract which set down the rights and duties of both buyer and seller.
Condition Report - A clear ‘snapshot’ of the condition of your potential purchase. It’s the most basic level of survey you can buy and is suitable for new-build homes and properties in good condition.
Contents Insurance - An insurance policy designed to cover any loss or damage to your possessions such as furniture, tech and appliances. It’s not essential but is often a good idea whether you own your home or rent. Read our guide to find out more about home insurance.
Contract - This is the binding document both the buyer and seller sign to complete the sale or purchase of a property. It can also be known as an agreement.
Conversion - Changing a property or room from one use to another. For example, converting a church into a home, converting a house into flats, or converting a loft into a bedroom.
Conveyancer - The person who handles the legal and administrative process of transferring the ownership of a property from one party to another. They’ll need to be suitably qualified and licensed – such as a solicitor or property lawyer.
Conveyancing - The name for all the legal work involved in transferring the ownership of a property from one party to another. You can get more information on conveyancing here.
Covenant - Legal requirement which you’ll find incorporated in the title deed (or lease) requiring the owner to do (or NOT to do) something in relation to the property.
Credit Report - A record of a someone’s ongoing and repaid debts. Credit reports are held (but not determined) by a credit reference agency such as Experian or Equifax. It’s a good idea to view a copy of yours before applying for credit so you can see what the lender sees ahead of time.
Declaration Of Trust - An agreement drawn up by the conveyancer sets down ‘who gets what’ if the property is sold or one owner buys out the other. It’s a good idea for cohabiting couples or friends buying together.
Deeds - Legal documents proving ownership of a property or land. They may contain mortgages and leases, conveyances, contracts for sale and wills. They are also known as Title Deeds.
Deposit - The money you’ll need to pay upfront when buying a home. Typically, an initial 10% is payable on exchange of contracts and the remainder is paid at completion. However, if you are taking a 95% mortgage, you'll only need to put down 5% at exchange.
Detached - Refers to a property that stands alone and has no shared walls with an adjoining property.
Default - When a borrower fails to make the agreed payments. Usually this applies to a mortgage, but can apply to any kind of loan.
Development - Properties that have been newly built or have recently undergone a sizeable refurbishment.
Disbursements - Fees that are paid by the solicitor on behalf of the buyer. These range from stamp duty and local authority searches to money transfer fees.
Doer-Upper - An older property in need of some maintenance.
Downpayment - The amount paid by the buyer to the seller on exchange of contracts to secure a property – usually 10% of the purchase price. Also known as a deposit.
Duplex - A flat that is split over two floors.
Early Redemption Charge - Often abbreviated to ERC, this is the financial penalty you’ll be charged to terminate a mortgage deal early – for example, in year three of a five-year fixed mortgage.
Easement - Right granted to someone other than the owner of a property, such as a right of way over land or a right to maintain services under land.
Edwardian - Properties built between 1901 and 1910 during the reign of King Edward VII. Typical features include red brickwork, wooden doors with stained glass windows, elegant carved wooden porches, sash windows, dark wood floors, and decorative fireplaces.
End-Of-Terrace - The last house in a row of similar houses that are joined together.
Endowment Mortgage - An interest-only mortgage that is combined with monthly payments into an endowment policy. The loan is paid off in a lump sum at the end of the term. Endowments have received bad press in recent years as many fell well short of their forecast value.
Energy Performance Certificate (EPC) - A certificate that details how efficiently a property uses energy with a ranking between A-G (with A being the most efficient). It will also provide an estimation of energy costs and offer suggestions on how to improve your efficiency. An EPC is legally required for properties being marketed for rent as well as for sale.
Engrossment - The final version of a document (usually a deed or statute) prepared by a solicitor.
Equity - The portion of the property value without a mortgage or loan secured against it. It comprises any increase in the value of your home, as well as your deposit and the capital you have paid off the loan.
Equity Release - A type of scheme which allows you to release some of the equity in your property through either a lifetime mortgage (where you borrow against a percentage but the loan’s not repaid until you die) or a home reversion plan (where you sell a percentage). Only available to the over-55s.
Estate Agent - The person who advertises and arranges viewings of a property on behalf of the seller. Fees are usually charged as a percentage of the selling price, although online agents offer upfront packages. You can find the best estate agents and letting agents in your local area with Zoopla's AgentFinder tool.
Excess - The agreed fixed sum that you’ll have to pay if you make a claim on an insurance policy.
Exchange (Of Contracts) - The point at which signed contracts confirming the intention to transfer ownership between buyer and seller are physically exchanged. At this stage the parties become legally bound by the terms. You’ll have to pay the deposit (typically 10% of the purchase price) at this point and if you then pull out of the deal you will be forfeiting this money.
First-Time Buyer - Usually refers to someone who is buying their first property. However, it can also be used to describe someone who is buying a home without selling one.
Fixed Rate Mortgage - A mortgage deal that comes with an interest rate that’s 'fixed' for an initial defined period, typically for two, three or five years.
Fixtures And Fittings - The non-structural items in a property that should be listed as included in a sale, although there may be negotiations about what exactly that includes.
Floorplan - A drawing that helps establish the dimensions of a property (although it may not be done to scale).
Flying Freehold - When part of a freehold property overhangs or underlies another freehold, such as when a room is situated above a shared driveway or a balcony extends over another property.
Freehold - If you own the freehold, you own the building and the land that it stands on outright indefinitely.
Further Advance - Extra money provided by a lender to a borrower and secured on the property as part of the mortgage debt. This may or may not be at the same interest rate.
Gazumping - When a seller has agreed an offer in principle on a property but later accepts a higher offer from another party.
Gazundering - When the buyer has made an offer that has been accepted but then subsequently reduces the offer just before exchanging contracts.
Georgian - Homes built between 1714 and 1830 during the reigns of King George (I to IV). Typical features include stucco fronts, tall sash windows and ceilings with decorative plasterwork.
Ground Rent - An annual fee paid by the leaseholder to the freeholder of the property. Often between £50 and £200 a year.
Guarantor - Some mortgages require borrowers to appoint someone who will be responsible for their debt should they fail to pay. In some cases, tenants may also appoint a guarantor, so the landlord can be assured of receiving rent.
Help To Buy - Help to Buy is a government scheme aimed at helping people with small deposits to buy their first home or move up the property ladder by providing an equity loan of up to 20%. It only applies to new-build properties. The current scheme is available until March 2021 when it will be replaced by a different one which will last until 2023. You can get all the information about Help to Buy here.
Help To Buy ISA - The Help to Buy ISA closed on 30 November 2019 to new applicants. It is a tax-free savings account designed to give first-time buyers saving for a deposit a cash boost. For every £200 saved into a Help to Buy ISA, the government will throw in an additional £50. The maximum bonus you can receive is £3,000, which would apply to savings of £12,000. So if you are a first-time buyer saving for a deposit of up to £15,000, you’ll be able to reach your target faster.
HomeBuyer Report - A report carried out by a surveyor on behalf of a buyer to assess the value and condition of a property and highlight any major defects. It is a more comprehensive survey than a Condition report, but not as extensive as a Building survey. The HomeBuyer report is suitable for most modern and older homes in a reasonable condition.
Houses In Multiple Occupation (HMO) - If a home has at least three tenants which form more than one household and the toilet, bathroom or kitchen facilities are shared, it’s classed as a HMO. Examples include a house split into separate bedsits, hostels and shared accommodation for students.
Improvement Grant - A grant given by a local authority towards the cost of repairing or improving a property.
Independent Financial Adviser (IFA) - Looking for help with your finances? An independent financial adviser offers unbiased and unrestricted advice from the whole of the market. They’ll also have to tell you upfront how they charge.
Individual Savings Account (ISA) - The interest paid on cash ISAs is free from tax, so you keep all the interest earned. You can save a set amount into an ISA every year (which runs April 6 to April 5). See Personal Savings Allowance for more on tax-free savings.
Instruction - When a property owner asks an estate agent to market their property for sale.
Interest - That unavoidable part of a mortgage or loan. Expressed as a monthly fee or annually (see APR), it is the fee charged by a lender to the borrower as compensation for the loss of the asset (usually either cash or consumer good). Interest is calculated as a percentage of the amount borrowed or the amount outstanding.
Interest-Only Mortgage - Mortgage where only the monthly interest charges are repaid initially. The mortgage amount itself i.e. the ‘capital’ is not paid off. The full mortgage must be repaid at the end of the term, though often through an ISA, endowment policy or pension plan. This type of mortgage has become more difficult to obtain since the Mortgage Market Review in 2014.
Joint Agents - Two estate agents jointly instructed by a seller to market a property.
Joint Tenants/ Joint Tenancy - Equal holding of a property between two or more persons. If one party dies, their share passes to the survivor(s).
Land Registry - The government department responsible for recording ownership of land in England and Wales. Searches will be requested from the Land Registry by conveyancers as part of any property transaction.
Land Registry fees - Set fee paid to Land Registry to register ownership of a property.
Leasehold - Ownership and right to occupy a property by way of a lease agreement for a given period, usually subject to an annual payment of rent to the owner of the freehold. Leases are normally long term, ranging from between 90 years and 999 years. Short leases are unattractive to mortgage lenders, with anything lower than 60 years likely to be difficult to mortgage. Take a look at these 11 things to watch out for when buying a leasehold property.
Lender - Institution that lends funds to assist the borrower with a property purchase.
Lender's Legal Fees - Fees incurred by the lender in arranging a mortgage that are passed on to the borrower.
Listed Building - Building that has been registered as being of special interest and has preservation orders on it. Listed buildings cannot normally be altered or extended without permission from the local council.
Loan-To-Value (LTV) - Percentage indicating the ratio of a mortgage loan on a property to its market value. Find out more about loan-to-value in our handy guide.
Local Authority Search - Checks carried out by the solicitor with the local council regarding any future development issues that might affect a property and/or the surrounding area. You can find more information on property searches here.
Maintenance Charge - Charge to a tenant or leaseholder made by a landlord to cover costs of maintaining a property. Depending on the property, this can include keeping the communal areas such as hallways and garden well maintained. Also known as a service charge.
Maisonette - A property that is part of a larger building, but has its own private entrance. Can either be on one floor or split-level.
Mortgage - Long-term loan obtained from a bank or building society which is used to fund the purchase of a property where the property is held as security. You will need to prove an income and a good credit score. You can get more information on mortgages in our dedicated guides.
Mortgage Deed - Document containing the terms and conditions of a loan secured on a property.
Mortgage Indemnity Guarantee (MIG) - Fee levied by lenders to protect them against the borrower defaulting. They are very rarely, if ever, charged now.
Mortgage Term - The period over which a mortgage will be repaid. Traditionally this was 25 years, but depending on age this can go up to 30.
Mortgage Valuation - Report commissioned by the lender to assess property value and determine the maximum amount to be loaned on the property. Not to be confused with a survey.
Multiple Agency - Where two or more estate agents are instructed by a seller to market a property. Only the agent who introduces a successful purchaser is paid.
Negative Equity - When the market value of a property falls below the outstanding mortgage loan balance.
NHBC (National House Building Council) Scheme - A guarantee offered on some newly built homes for structural defects occurring within a specified time after construction. Get to grips with new-build homes with our guide.
Offer - Indication from a potential buyer of a willingness to purchase a property at an indicated price. An offer is not legally binding in England and Wales and can be withdrawn or changed at any time prior to exchange of contracts.
Open Market Value - Price that a property would be likely to achieve if it were available for sale.
Pied-A-Terre - Literally translates to ‘foot on the ground’ but normally refers to property that is kept for temporary or occasional occupation. They are often used for part of the working week or year as a secondary residence.
Preliminary Enquiries - Initial set of questions from the buyer’s solicitor regarding a property that must be answered by the seller prior to exchange of contracts.
Premium - Amount payable on an insurance policy, usually paid monthly.
Private Treaty - The traditional means of buying and selling property, ie, where the price and sale terms are negotiated directly between the seller and purchaser or their estate agent.
Probate - When the owner of a property dies and leaves the property in their will, probate is the official process for proving the will is valid. For inheritance tax purposes the property may need to be valued and this is typically carried out by the district valuer who represents the Inland Revenue. Contracts cannot be exchanged on a property until probate has been granted.
Purchaser - The person (or people) buying a property. Also known as the buyer.
Redemption - Completion of the full and final repayment of a mortgage.
Redemption Figure - Amount required to fully repay a mortgage including interest and any penalties. This may incorporate an early redemption charge.
Repayment Mortgage - Mortgage with monthly repayments consisting of capital (the amount you borrowed) combined with interest. It has become the most common type of mortgage since the Mortgage Market Review was introduced in 2014.
Repossession - If you fall behind in your mortgage repayments the lender can take possession of the property that secures the loan. If you live in your property you will be evicted.
Return On Investment - The amount you get back in comparison to the amount you put into an investment.
Residential Property - Property occupied for private or domestic purposes.
Right To Buy - A government scheme that allows eligible council tenants in England to buy their home at a discounted price. Take a look at our guide to find out more about Right to Buy.
Searches - Your solicitor will make enquiries to the local authority and Land Registry to ensure there aren’t any matters that will adversely affect the property or the surrounding area. Searches typically cost between £250 and £300 and the money will need to be transferred to the solicitor early on in the buying process.
Security - Property used to secure the mortgage loan.
Self-Build - The process of building your own home. If you are a builder then this can be taken literally, but for most people this involves choosing builders, architects and surveyors to undertake the work.
Seller - The person who is selling the property. Also known as the vendor.
Semi-Detached - A type of property where one side wall is shared with an adjoining property.
Share Of Freehold - If you are buying a flat with a share of the freehold, you become part of the group of people or company that make decisions and organise the maintenance of the building.
Shared Ownership - The option to buy a share of a property (between 25% and 75%) from a housing association. You’ll then pay an ‘affordable rent’ on the share of the property you don’t own. You can find out more about shared ownership here.
Sole Agency - Where a seller instructs one agent exclusively to market their property.
Sole Selling Rights - Where one estate agent has exclusive rights to market a property and is entitled to a fee regardless of how the property is sold.
Solicitor - A professionally qualified legal expert who will prepare the documents on behalf of the buyer or seller throughout the process of purchasing a property. Responsibilities include conducting searches, collecting funds and arranging and overseeing the exchanging and completion of contracts.
Stamp Duty Land Tax (SDLT) - The tax paid to the government by a buyer on the purchase of a property. Rates vary between 1% and 4% depending on the purchase price. The tax kicks in at £125,000 but genuine first-time buyers get the first £300,000 of a property value tax-free if the home is worth less than £500,000. Find out more here.
Stamp Duty Holiday - A temporary pause of SDLT payments up to a set threshold. Until 31 March 2021 there was a stamp duty holiday in England and Northern Ireland on all properties up to £500,000.
Standard Variable Rate (SVR) Mortgage - A type of mortgage where interest rates vary at the discretion of the lender based on market conditions. If you have a mortgage deal with a discount rate, at the end of the discounted period it will revert to a standard variable rate.
Structural Survey - See Building Survey – the new name for a structural survey.
Studio Flat/Apartment - A flat with just one principle living area containing both cooking and sleeping facilities with a separate bathroom or shower room.
Subject To Contract - A provisional agreement prior to exchange of contracts that is not yet legally binding, so either party can still pull out of the transaction.
Survey - Report on the condition of a property. Get to grips with the various types of survey available in our guide.
Surveyor - Qualified expert who carries out the survey of a property.
Tenancy Deposit - A refundable sum of money paid to your landlord at the start of your tenancy.
Tenants In Common - An optional method of shared home ownership (not necessarily in equal shares). If an owner dies, the owner's stake in the property is passed to their heirs, rather than to the other owners of the property.
Terraced - Property where both side walls are shared with adjoining properties.
Title Deeds - Documents showing the legal rights to ownership of a property.
Tracker Mortgage - A tracker mortgage usually follows the Bank of England base rate. As a result, your mortgage repayments can go up or down.
Under Offer - Status of a property from the point at which a seller has accepted an offer until exchange of contracts.
UK Finance (Formerly The Council Of Mortgage Lenders) - The main trade body (but not regulator) that represents UK mortgage lenders. Members include banks and building societies. UK Finance promotes good practice, collects and publishes data about the mortgage market and liaises with the government.
Utilities - Refers to services such as gas, electricity, water, sewage and broadband. Find out about the costs of running a home here.
Vacant Possession - A property that has been vacated by any previous occupants upon the completion of the purchase.
Valuation - Survey conducted by a qualified professional such as a Chartered Surveyor to establish an estimate of the current market value of a property.
Vendor - Person who is selling a property. They may also be known as the seller.
Victorian - Homes built between 1837 and 1901 during the reign of Queen Victoria. They are one of the most common types of period property in the country as a result of the Industrial Revolution. Typical features including red brick façades, bay windows and fireplaces with cast iron hearths.
Yield - The income generated from a rental property stated as a percentage of the property value. For example, if a property was bought for £100,000 and rented for £600 per calendar month, the annual yield would be 7.2%.