Property Finance
How Property Finance Can Help You Realise Your Financial Dreams
Property finance is no longer just for people with years of experience and millions of pounds to burn. While that may have been the perception some time ago, the average landlord is now completely different. Indeed, many people with no experience at all are taking the chance to get property finance and stepping into the world of buy to let. There are several reasons why people are choosing to get involved in BTL.
For a start, many people get into property finance because they want to make a safe investment which has a good rate of return. Not many people understand stocks and shares, which is why we need stockbrokers, but property finance seems easier to grasp. Perhaps this is because so many of us have gone through the process of buying and comparing houses. When it comes to property finance for our own homes, we are experts at assessing the relative merits of properties and at deciding just what needs to be done to them to bring them up to scratch.
This is why property finance seems a sensible way to plan for retirement and avoid the dreaded pension shortfall announced so often by the government. Getting property finance and letting out a property can mean that by the time retirement comes, a couple has a valuable asset which they can sell to provide a comfortable retirement. And the good news is that if they do their sums right, it won't cost them a bomb. If the rental cover calculations work out in their favour, the property will practically pay for itself.
Providing For Children with BTL
Another reason to consider property finance is to provide for your children. This is not a question of financial provision, but of looking at the possibilities for them to own their own home. It seems that potential first time buyers are finding it hard to get finance to buy their own homes. This is because the value of property is rising and their incomes are not keeping pace. In addition, many potential first time buyers are carrying debt from university, putting finance out of reach until they are in their mid-thirties.
One way that parents can help their young children is by thinking ahead about this situation and taking out a mortgage on a BTL property. By the time their school age children are ready to buy a home, they will have a home that can be passed on to the children or sold to give them the money they need to make a deposit on the home of their choice. This is one alternative to putting money in a piggy bank.
And helping your children doesn't have to stop there. When children get to university, they need somewhere to stay and the quality of some accommodation doesn't meet parent's exacting standards. Getting a BTL property in a university town will provide suitable accommodation, provided the lender you choose allows letting to family members. And at the end of your child's university career, you will have an asset that you can retain or sell on. This is one reason that many people are getting into property finance.
