10th Jun 2022|Lettings|BTR & Asset Management|

How To Build A Lettings Portfolio

It’s no secret that demand is far outstripping supply within the property market, and tenant competition is fiercer than ever. According to PropertyMark, November saw the highest number of actively searching tenants on record, and the number of buy to let landlords reached an all-time high. As a result, many of our clients have asked us how they can build a lettings portfolio that suits their needs and lifestyle and works in the hectic 2022 lettings market. In this piece, we’ll be running you through the advice we provide to our clients when they are considering building a lettings portfolio, so that you can plan your next investment, understand the market, and maximise your profits.

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What is your aim?

Our first tip is to understand what you want from your buy-to-let portfolio. Many of our clients want to generate hassle-free, passive income to provide them with financial security later on in life. These clients may have other full-time jobs that require their attention, and would be looking to build a small, manageable portfolio of properties that could be handled by their chosen managing agency. On the other hand, we understand that other landlords may wish to continually grow and expand their portfolios into a significant business venture, and have more control over their investments. These individuals may choose to pursue their property investments as a full-time job, and simply need a lettings agency such as Centrick to help them source a tenant rather than manage their property in its entirety. Deciding the level of involvement you want in your lettings ventures, and your goals for your property portfolio, will provide you with clarity in your business decisions. This is also important if you choose to involve a managing agent such as Centrick, who will be able to tailor their advice and services to suit your individual needs and goals.

Market Matters

Secondly, you must understand the market in your chosen area in order to maximise your turnover. By doing your own research, and consulting with a reputable local letting agent such as Centrick, you will be able to better understand what kinds of properties are going to appeal to renters in your area. For example, if your budget can accommodate the purchase of four one-bedroom flats, or just one 6-bed detached family home, you’d do well to understand the market trends within your postcode to help you make the best choice. After all, there’s little point expanding your portfolio to include properties that simply aren’t going to get let! We also advise being wary of the time you choose to purchase your property, and subsequently list it on the lettings market. Landlords looking to let out student properties would do well to list their buy-to-let investments well in advance of the start of each academic year. What’s more, if the property requires updating, it is vital that this is accounted for in preparation for listing your property at the best time to gather the most interest. So, although it might feel tempting to snap up a property bargain that’s not necessarily in an area you know, or of a format you’re familiar with, we advise that you do your due diligence before tackling your next investment.

A Piece of Advice…

Lastly, we recommend building a lettings portfolio with the help of a financial advisor. Whether you’re simply looking for passive income or are focusing all your efforts on a buy-to-let business model, having a long-term financial plan will keep you focused and help you to avoid any potential pitfalls in the process. A financial advisor can help you decide on the best way to finance your properties, secure buy-to-let mortgages, leverage your current portfolio and help you to understand lending criteria, capital growth and yields. Similarly, make the most out of your portfolio by consulting with a local letting agent. Akin to using a financial advisor, a letting agent can provide you with valuable market insights to help you maximise your yields, inform your next investment, and steer clear of void periods. What’s more, lettings agencies such as Centrick offer an asset management service for those who want to receive more tailored services – just ask your lettings manager how asset management can help you optimise your lettings portfolio!

Centrick Birmingham Lettings

What’s next for building a lettings portfolio?

Now you’ve weighed up your options and you’re ready to build a lettings portfolio that suits you, let Centrick take care of the rest. From our tenant-find only package for the hands-on landlord, to our comprehensive management packages for your entire portfolio, your local Centrick lettings team would be delighted to help you on your property journey. Fill in the form below to contact us:

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