Maximizing leverage by utilising buy to let mortgages are a brilliant way to help grow a property investment portfolio. Rather than using all of your own resources, leveraging debt (buy to let mortgages) helps you to acquire more property and ultimately increases your ROI.
Are buy to let mortgages the right choice?
Of course, consideration is required in order to establish a debt repayment plan. But in terms of pure growth then buy to let mortgages can really help achieve this, assuming this is your aim.
If your goal is not to grow a large portfolio, then leveraging debt with buy to let mortgages might not be the path to take. The key is to establish your aims and ambitions as a property investor. There is no right or wrong answer of course, but it is helpful to know what path you intend to follow. If you intend to work with an adviser (a buy to let mortgage broker like ourselves) and you are clear on your bigger plan, you can share this with them and they will be much better placed to help.
Buy to let mortgages are not the only option!
When it comes to property investing, there are multiple ways to do it. Indeed, buy-to-lets might not be your preferred choice. They may no longer offer the returns that you could once achieve. I have said it many times before, in this day and age, property investing is now a game for professionals. The amateur landlords have either left the market or are just not active. The activity that we are seeing in this sector, is with those people who are making this a career and looking to grow and maximize their returns.
Buy to let mortgages alone can not maximise ROI?
To maximize returns we are seeing more and more buy to let investors broadening their horizons and research different areas. A great platform to help with researching yields in different areas is Hubinto and is definitely worth exploring. But the point is this; you can’t rely on leveraging alone to maximize your returns or growth, you need to consider all investment options.
The professional property investor today is not only looking at different areas but also considering alternative ways to maximize their yields. These might include investing in HMOs (houses of multiple occupation) to achieve higher yields and buying properties that need work before letting them.
There are many other ways to invest in property and maximize returns but the point is; property investors are no longer passively sitting back and just buying a buy to let or two. They are looking at every option that is open to them, and so should you.