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Buy to Let Advice: How to Protect Your Investment

By Parmdeep Vadesha

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Published: 17Dec2008
Word count: 400
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The credit crunch has prompted the downfall of several property investors who had no choice but to surrender the keys to their lenders. While the pinch is inevitable, there are still ways for you to avoid losing your investment property. By taking heed of the following buy to let advice, you will be able to protect your investment property from being turned over to your lender.

1. Check your mortgage. One of the best pieces of buy to let advice that a property investor can follow to protect your buy to let property is by checking your mortgage. As a buy to let investor, you have the capacity to offset mortgage interest (but not capital repayments) against rental income for tax purposes. When property prices stabilise, consider switching to an interest-only mortgage so you can lessen your monthly payments. While it's true that the buy to let market has slowed down, there are still numerous deals to choose from - especially if you have plenty of equity.

2. Diversify your investments. Spread your risk by buying properties in different markets. A diverse property investment portfolio will bring you higher returns, and protection against volatile markets. Even if one of your investments performs badly, you can still rely on your other investments in different areas to balance things out.

3. Improve your buy to let property. By enhancing your investment property, you increase its value more than the improvement costs. You can convert a spare room to a more usable room, increase the size of your home, add a conservatory, or install a new kitchen or bathroom.

4. Hold on to your property. Even with problems in negative equity, property prices have increased steadily the past years. According to Landlord Mortgages, the long-term trend for the buy to let sector is optimistic. Therefore even if the market has been stagnating, the long-term outlook remains positive - which explains why many property investors choose to stay for the long-term.

Investment in UK property offers significantly discounted prices and numerous opportunities for long term investors. Property chosen in the right location - and bought from motivated sellers at prices below market value - can offer potentially profitable returns. In view of today's stabilising market and tightened lending criteria, investors would do well to heed buy to let advice that will help them survive the market and enjoy strong long term profits.

Parmdeep Vadesha is a property investment expert and founder of the largest community of property entrepreneurs on the web who buy below market value properties from distressed homeowners facing repossession, divorce and bankruptcy. He writes a monthly newsletter for over 70,000 property investors worldwide - http://www.Property-System.com

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