Financial Analysis & Negotiation

When investing in property it is essential that you review the property objectively and calculate whether it is a sound financial investment. You want to ensure you are buying a property asset and not a liability!

It is easy to be dazzled by the ‘headline price’ or sales promotions such as ‘investment property for sale’ or ‘ideal for an investor’, but financial due diligence is the key to Buy-To-Let investment success. When completing your financial analysis there are 3 key elements that you need to consider;

(1) The income generated by the property
(2) Refurbishment  requirements
(3) If the purchase price is ‘Below Market Value’

 
Income  Generated

You will hear the term ‘Gross Rental Yield’ banded around but what does it actually mean? The gross rental yield is calculated by dividing the annual rent by the purchase price. It is great as a starting point, but it is important to understand that there are other costs involved in renting property and you need to feel comfortable calculating the net cash-flow.

Don’t invest in property if you are not confident that the income from your property is in-line with your goals, whether this is for you to utilise your property as a pension or to provide an additional income boost into your family today.

Refurbishment Expenses
 


Remember the cost of any refurbishment work to make the property ‘tenant ready’ needs to be paid for with your cash, it can’t be included in the Buy-to-Let Mortgage. This means the more detailed your projection of expenses, the better you can assess the overall investment and make a sound investment decision.

 
Purchase Price Below Market Value

The Sourcing page will provide you with details on how to ensure the property you invest in is ‘Below Market Value’.

How can I help?

No longer will you need to feel overwhelmed and worried about whether you are investing wisely, as I will work closely with you to ensure you fully understand the financials of any investment property. Each property will have been individually viewed by our combined team of Chartered Surveyor and Refurbishment Manager and a detailed ‘room by room’ schedule of any work required will be documented and shared with you.

You will not simply be provided with a high level refurbishment figure over which you have little understanding. You will fully understand every aspect of the refurbishment to be completed on your behalf and we will utilise our connections and knowledge to source and supply items at competitive rates. The work required will then be included in the financial projections, so although there are no absolute guarantees, the risk of ‘nasty surprises’ is greatly reduced.

You will also be provided with up to date Sale comparables, so that you feel happy with the Below Market Value and the equity achieved at Day 1, following the refurbishment. Finally our documentation will make it very clear for you to understand the projected Cash-flow your property will generate.

Our roles is to make you feel both comfortable and confident so you are able to make an intelligent property investment decision.

Step 1: Consultation & Strategy

Step 2: Sourcing Property

Step 3: Financial Analysis & Negotiation

Step 4: Mortgage Application & Conveyancing

Step 5: Exchange & Complete Contracts

Step 6: Light Refurbishment & Letting Agent