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Thinking of converting commercial property to residential?

While renting out a property this way has its clear advantages, there’s a lot to consider. Ensure you’ve thought every detail through before you decide to go ahead.

Unsure where to start? Here’s a handy guide for landlords considering this path.

What to Consider When Changing Commercial Property to Residential

First things first, you need to decide whether this conversion is feasible for you at this time.

The Type of Property

There are many kinds of commercial building, from office to retail. Some of these may be easier to convert than others – so it’s vital you look into the specific details.

Class J allows developers a lot more freedom, however there are still some exemptions and restraints. Ensure you’re aware of these from the start.

Building Conversion Costs

While you’re not starting from scratch, it’s important to note that the cost of converting the existing building could be considerable.

Particularly if the building requires significant structural work, it might be more costly than expected.

Are you prepared for this?

Planning Permission Commercial to Residential

While it’s not always the case, you may require planning permission before going ahead with any work. Even if the building falls within Class J guidelines, you may still need permission.

Particularly if you plan on knocking down walls, for example, you may need to prepare for this extra expense.

Local Planning Laws

You may need to speak to the local planning authority, or local council, before going ahead with any work.

Location

Bear in mind that the location of commercial properties might not be ideal for residents.

Consider:

  • Transport links
  • Local amenities
  • Nearby schools
  • Parking
  • Noise pollution
  • Access for developers

Ask yourself, ‘Can you live in your commercial building?’ If the answer is no, it’s unlikely it will appeal to tenants either.

More and more people are choosing to rent over buy, but location can make or break this. Particularly if you’re trying to encourage a long-term tenancy, the area is everything. Tenants will only want to lay their roots in your property if they like their surroundings also.

Mortgage

Unless you have enough cash upfront, it’s likely you’ll need a mortgage to purchase the property.

This may mean the conversion is subject to your broker’s terms and conditions.

Insurance

While all landlords should consider insurance, when it comes to conversion, there’s an extra need to safeguard the building.

During the work planned to go ahead, are you covered? Consider the terms of your mortgage agreement – you may be required to get insurance.

Making a Commercial Conversion Liveable

There are a number of requirements that need to be met before tenants could live in the property. A commercial to residential conversion should consider the following:

  • Plumbing
  • Heating
  • Electrical safety
  • Removal of hazardous material
  • Fire safety

Ensure all these needs are met before you consider letting tenants move in.

Commercial Property Change of Use to Residential – Other Considerations

Of course, there’s more to a conversion than simply making the property safe.

Residential units have things that commercial spaces may not, such as storage areas. Also, how secure is the rental?

It’s a good idea to imagine yourself living in the commercial property. Does it feel like a home?

The Pros of Changing Commercial Property to Residential

There are some undeniable perks with converting commercial buildings, including:

  • You could potentially get a bigger property for a lower price
  • You may not need planning permission
  • There’s no property chain
  • Investing in property can be hugely profitable

The Cons of Using Commercial Property As Residential

While there are some positives, there are also some inevitable downsides:

  • Sometimes the conversion can be more costly than expected, particularly if planning permission is required
  • You’ll need a specialist buildings survey, which can be expensive
  • It’s easy for conversion costs to spiral out of control
  • Conversions can run on for longer than anticipated

Meeting Your Requirements as a Landlord

Decided this is direction you want to take as a landlord? This journey is both an exciting and difficult one.

As with any property, there are a number of requirements you’ll need to meet as a landlord. But, you’ll also want to ensure your investment is protected every step of the way.

From check-in to check-out, No Letting Go will ensure you’re meeting all the necessary safety standards. As well as this, we’ll ensure your tenants are looking after the property as requested. Our comprehensive property inventory services offer you peace of mind, while making you the best landlord you can be!

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New to the buy-to-let game? About to take the first steps to becoming a property investor?

While this is an exciting journey, it can feel overwhelming at times! There’s a lot to learn when you’re just starting out.

To ensure you stay on the right track, we’ve got some tips on property investment for beginners. This advice should help guide you along the way!

Property Investment Basics

Before you start looking at properties – you need to work out what type of property investor you want to be.

Decide Whether You Need Partners

Do you want to invest alone, or with others?

If doing this by yourself, any money you make from letting out the property will be yours alone. However, some people are not in the financial position to do so.

So, first things first, ensure you know what you can afford before you embark on the journey!

How Will You Finance Your Investment?

During the planning process, your investment strategy should take into account exactly how you’ll afford to purchase a property. This should happen before making an offer on a house.

There are a number of different things to consider, including:

  • Stamp duty land tax
  • Getting a mortgage
  • The day to day running of the property
  • Current property prices on the market
  • Whether now is a good time to buy
  • Survey costs
  • Solicitor fees
  • Insurance

Hopefully, sooner rather than later, the rental income you generate will ensure cash is flowing into your pocket. However, the upfront costs involved with buying a property should not be overlooked.

What Type of Investor Do You Want to Be?

When investing in property, you have a number of options open to you. This could be:

  • A new career path
  • Your main source of income
  • A source of extra income on top of another job

With direct property investment, it helps to have a long-term plan. Imagine yourself in five years’ time. Where do you want to be?

More and more people are choosing to rent over buy. This presents an exciting market for investors to take advantage of.

How to Invest in Property

Once you’ve got the basics sorted and know what type of investor you want to be, it’s time to get started.

But, that can be easier said than done! So, here’s how to find a good investment property:

Choose Where You Want to Invest

Where do you want to invest? Decide early-on.

Here, research is key. There are a number of things to consider, including:

  • The average cost of buying a house
  • The average rental yield in the area
  • The type of tenants in the area (families, students etc.)
  • Whether the area is up-and-coming
  • How close you want the rental property to be to your own home

Once you’ve decided on the area, it will make choosing the right property to invest in much easier. However, it can be more difficult than anticipated to get to this point!

Identify Your Target Tenant

Who do you want to rent to? It helps to have a target tenant in mind.

For example, if you invest in a studio flat, it’s unlikely this will appeal to families. However, in an area where many residents are postgrads, this could be perfect.

It can be tough to narrow it down – but it’s worth it. Remember, the area you’re in should play a huge role in deciding your target tenant.

Ask yourself who you would and wouldn’t let to. Would you consider renting to students? This may widen your options, particularly in an area with a number of universities.

Make Sure Rental Returns are Competitive

The best way to start investing in property? Be on the lookout for high rental yields.

This can vary place to place, as everywhere in the UK is different. But, these tend to be favourable locations where there’s a high demand for rental homes.

You’ll want to ensure that, over time, the property can not only pay for itself but make you a profit. This includes any extra charges, such as maintenance.

Look for Opportunities to Add Value

The UK property market is constantly changing! Even some of the best estate agents can’t predict what will happen next.

House price growth is one of the main reasons to invest. When you eventually come to sell the property, you want to know you’ll make a profit. One way to ensure this is by looking for ways to add value:

  • Consider ways to refurbish/renovate the property
  • Choose an up-and-coming location

The best property investments are those which look to the future, rather than just the here-and-now.

Property Investment Advice – Understanding the Risks

If you’ve decided this is the path you want to take, you’ll need some property investment tips to help you along the way.

Ensure you’ve considered these risks:

  • Rent is not always guaranteed – which may mean you can’t afford mortgage repayments. Always try to prevent void periods at all costs
  • House prices can fall
  • Difficult tenants can cause a number of issues, such as damage to the property
  • Major house repairs can be extremely expensive

Property Investment Guide – The Potential Returns

Despite some inevitable risks, the world of buy-to-let is an exciting one, and can deliver huge returns.

This market can be a very profitable one! Plus, becoming a landlord is a rewarding career path to follow.

Protecting Your Investment

One of the most important factors to consider? The ways to safeguard your rental property.

Having a comprehensive, detailed inventory is one of the most significant elements – essential for protecting both landlords and tenants.

Unsure how to get started? No Letting Go can help. From check-in to check-out, we’ll make protecting your investment our top priority. Find out more about our inventory services here.

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Looking to make the most of being a landlord? Hoping to be more efficient while reducing costs?

There are many ways this can be done! We’ve outlined them for you to help you maximise your opportunities.

Here’s how to get the most from your portfolio in 2019.

Always Run a Tenant Reference Check

If your properties are your source of income, who you let to can make or break your success.

There are a number of consequences that can arise from letting to an untrustworthy tenant! This could be anything from damage to your investment to a costly legal battle.

The result? You may be unable to let out that particular property for some time, causing potentially severe financial consequences.

The solution? Always run a tenant reference check with a professional company!

Meet Your Legal Responsibilities

From insurance to health and safety, landlords have number of requirements to meet. Failure to do so will make your property less desirable to live in.

So, if you’re looking to get the most from your portfolio – never cut corners when it comes to being a good landlord.

Inspect the Property Regularly

Landlords inspections are key for ensuring that your property is being maintained as agreed. As well as this, you’ll appear hands-on and attentive to detail.

When visiting the property, ensure you’re thorough. Keep a record – this will make it easier to determine fair wear and tear from recent damage.

Treat it Like a Business

For many, bricks and mortar aren’t seen as a source of income. However, if you’re a landlord, the opposite is true.

This means you should treat it as such! While being approachable will help you form a strong relationship with your tenants, you should have a business mind.

Here – a structured and organised approach is key:

  • Who’s dealing with your finances?
  • Which Tenancy Deposit Scheme are you using?
  • If you’re unable to look after your property for any reason, such as a holiday, who will take your place?
  • If you’re using an agent, are their fees covered?

Keep Researching the Market

Research shouldn’t stop once your properties are let out! The local area, and what people want from it, is constantly changing.

Always have a target tenant in mind – for example a one-bed flat is unlikely to appeal to a market where many families rent.

Work to Reduce Void Periods

All landlords want to prevent void periods! However, this can be easier said than done.

If you keep coming up against this issue, it’s time to start taking it more seriously. Here are some solutions you may not have considered:

Maintain the Property Regularly

In 2019, resolve to see property maintenance not as an extra expense – but an investment. Often, what you put in is what you’ll get out.

This doesn’t just apply when trying to attract new tenants. For existing tenants, regular maintenance is key also. It can help you form a good relationship with them, as well as help justify reasonable rent increases.

Remember – it pays to look after your tenants!

Have Set Processes for Dealing With Issues

What procedure do you follow if something goes wrong?

For example, if a tenant falls behind on their rent, what do you do? You should already know the answer to this before it happens. Part of getting the most of your portfolio is understanding that problems can arise – and knowing how to deal with them.

Ideally, if you’re organised enough, you’ll take a proactive, rather than reactive approach.

Keep a Paper Trail

If you’re meeting all the safety requirements, ensure you have proof of this. From legionella risk assessments to smoke detector installation, it’s handy to have a paper trail.

Have a Detailed, Thorough Inventory

One way of ensuring your investment is secure? Have a comprehensive inventory.

This shouldn’t be just a collection of pictures, but a full and thorough report. The key here is clarity – so no issues can arise. Remember, simple facts aren’t enough; details are necessary for determining a weak inventory from a strong one.

This has multiple benefits to all parties, such as reducing the risk of deposit disputes.

But, many landlords struggle to put these together themselves. There’s lack of time and know-how for example! What’s more, even when landlords do put together DIY inventories, they’re often insufficient.

Luckily, we have a solution. Our professional, comprehensive property inventory services will take the hassle out of the process for you. From check-in to check-out, your investment will be protected!

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If you fancy turning your hand to property investment but unsure where to start, we’ve got it covered. We’ve taken a look at the best place to invest in property in the UK. To work this out, we’ve looked at the average rental yield all UK cities and ranked them accordingly. We’ve worked this out by looking at the average property value and average annual rent in each city. Where does your city rank?

Ranked from bottom to top by average rental yield percentage, here are the results…

68. St Albans – 2.76%

Average property price: £581,041
Average rent: £1,336 pcm

67. Truro – 2.85%

Average property price: £320,611
Average rent: £761 pcm

66. Worcester – 2.87%

Average property price: £260,039
Average rent: £623 pcm

65. Chelmsford – 3.04%

Average property price: £387,413
Average rent: £982 pcm

64. Salisbury – 3.08%

Average property price: £341,338
Average rent: £876 pcm

63. St Asaph – 3.1%

Average property price: £225,104
Average rent: £581 pcm

62. Hereford – 3.14%

Average property price: £249,947
Average rent: £655 pcm

61. Ripon – 3.2%

Average property price: £290,495
Average rent: £774 pcm

60. Lichfield – 3.2%

Average property price: £291,353
Average rent: £777 pcm

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59. Wells – 3.31%

Average property price: £308,536
Average rent: £850 pcm

58. Cambridge – 3.34%

Average property price: £455,104
Average rent: £1,268 pcm

57. Winchester – 3.36%

Average property price: £548,755
Average rent: £1,537 pcm

56. Chichester – 3.4%

Average property price: £428,867
Average rent: £1,214 pcm

55. Wolverhampton – 3.44%

Average property price: £188,146
Average rent: £539 pcm

54. Bath – 3.44%

Average property price: £444,257
Average rent: £1,274 pcm

53. Gloucester – 3.47%

Average property price: £230,997
Average rent: £668 pcm

52. Chester – 3.5%

Average property price: £254,681
Average rent: £742 pcm

51. Perth – 3.5%

Average property price: £202,679
Average rent: £591 pcm

50. Exeter – 3.52%

Average property price: £293,069
Average rent: £860 pcm

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49. York – 3.55%

Average property price: £282,874
Average rent: £837 pcm

48. St David’s – 3.56%

Average property price: £234,104
Average rent: £695 pcm

47. Peterborough – 3.7%

Average property price: £217,668
Average rent: £672 pcm

46. Carlisle – 3.73%

Average property price: £157,070
Average rent: £488 pcm

45. Ely – 3.8%

Average property price: £295,045
Average rent: £935 pcm

44. Norwich – 3.9%

Average property price: £265,871
Average rent: £864 pcm

43. Leicester – 4.01%

Average property price: £216,421
Average rent: £724 pcm

42. Bristol – 4.03%

Average property price: £314,629
Average rent: £1,057 pcm

41. Canterbury – 4.07%

Average property price: £335,782
Average rent: £1,138 pcm

40. Lincoln – 4.07%

Average property price: £192,423
Average rent: £653 pcm

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39. Wakefield – 4.08%

Average property price: £177,810
Average rent: £605 pcm

38. Derby – 4.12%

Average property price: £194,951
Average rent: £669 pcm

37. Lancaster – 4.25%

Average property price: £191,729
Average rent: £679 pcm

36. Dundee – 4.28%

Average rental price: £156,781
Average rent: £559 pcm

35. Southampton – 4.36%

Average rental price: £289,546
Average rent: £1,053 pcm

34. Hull – 4.43%

Average rental price: £133,306
Average rent: £492 pcm

33. Newry – 4.44%

Average rental price: £146,353
Average rent: £542 pcm

32. Oxford – 4.46%

Average property price: £503,570
Average rent: £1,870 pcm

31. Stoke-on-Trent – 4.53%

Average property price: £143,358
Average rent: £541 pcm

30. Bradford – 4.53%

Average property price: £129,444
Average rent: £489 pcm

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29. Aberdeen – 4.58%

Average property price: £197,352
Average rent: £753 pcm

28. Preston – 4.6%

Average property price: £179,405
Average rent: £687 pcm

27. Inverness – 4.68%

Average property price: £177,736
Average rent: £693 pcm

26. Newport – 4.71%

Average property price: £165,970
Average rent: £651 pcm

25. Stirling – 4.78%

Average property price: £194,439
Average rent: £775 pcm

24. Brighton & Hove – 4.79%

Average property price: £385,220
Average rent: £1,537 pcm

23. London – 4.8%

Average property price: £672,390
Average rent: £2,692 pcm

22. Newcastle – 4.81%

Average property price: £203,524
Average rent: £816 pcm

21. Sheffield – 4.91%

Average property price: £187,360
Average rent: £767 pcm

20. Sunderland – 5.02%

Average property price: £139,518
Average rent: £584 pcm

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19. Derry – 5.12%

Average property price: £110,884
Average rent: £473 pcm

18. Glasgow – 5.21%

Average property price: £175,623
Average rent: £762 pcm

17. Lisburn – 5.36%

Average property price: £143,435
Average rent: £641 pcm

16. Plymouth – 5.47%

Average property price: £200,655
Average rent: £914 pcm

15. Cardiff – 5.6%

Average property price: £233,833
Average rent: £1,092 pcm

14. Belfast – 5.72%

Average property price: £153,310
Average rent: £731 pcm

13. Swansea – 5.74%

Average property price: £167,147
Average rent: £799 pcm

12. Liverpool – 5.78%

Average property price: £164,838
Average rent: £794 pcm

11. Portsmouth – 5.81%

Average property price: £227,041
Average rent: £1,100 pcm

10. Edinburgh – 5.89%

Coming in at 10th place is Scotland’s capital Edinburgh. The city is a highly desirable place to live and is a huge cultural hub north of the border. Having said this, property prices are relatively low while rent remains high. This means, Edinburgh is a great place for any landlord to build a portfolio.
Average property price: £268,989
Average rent: £1,320 pcm

9. Nottingham – 5.97%

With a popular university paired with high standard of living, property investment in Nottingham could be a money maker. With a 5.97% average rental yield, this is a serious consideration for anyone looking to make money.
Average property price: £188,609
Average rent: £939 pcm

8. Birmingham – 6.27%

Proclaimed to be the second city in the UK, Birmingham was guaranteed to feature high in this list. The property prices are in line with much of the midlands while rent is high. The popular university also prevents an opportunity for those considering student lets.
Average property price: £188,235
Average rent: £984 pcm

7. Armagh – 6.42%

The Northern Irish city is claimed to be the fifth-least-populous city in the UK. Maybe that goes some way to explaining the low property prices. Rent, at least, is in line with the surrounding area.
Average property price: £105,815
Average rent: £566 pcm

6. Manchester – 6.5%

Though Birmingham takes the title of Britain’s second city, Manchester seems to be stealing the attention. It’s a highly favourable place to live, especially among the younger generations who seek a buzzy metropolitan area. This has led to rent remaining high while property prices sit in line with much of the north of England.
Average property price: £175,872
Average rent: £952 pcm

5. Coventry – 6.64%

Coventry storms ahead into 5th position in our list. As the ninth largest city in the UK, it’s no surprise it features high. The city is the only Midlands spot to break the £1,000 average rent mark.
Average property price: £195,255
Average rent: £1,080 pcm

4. Durham – 6.71%

At the business end of the list we find north-eastern city of Durham. The location is renowned for its beauty and highly respected university. There are plenty of reasons why people are attracted to the city, an alluring potential for investment.
Average property price: £159,146
Average rent: £890 pcm

3. Leeds – 6.89%

Another city that people are naturally driven to. Leeds is metropolitan city renowned for its shopping, nightlife and culture. If you consider the high rent prices and relatively low property prices, you may find yourself building a portfolio here.
Average property price: £204,644
Average rent: £1,175 pcm

2. Salford – 7.53%

If you’re looking to invest in Manchester, you may do better by looking to neighbouring Salford. The city offers similar average rent but with a reduction in average property prices, a win-win!
Average property price: £156,118
Average rent: £979 pcm

1. Bangor – 9.42%

The best place to invest in property in the UK is Bangor – an exceptional opportunity for anyone considering property investment. The house prices are aligned with the local area and pretty low. The average rent is considerably higher, exceeding £1,300 pcm.
Average property price: £169,148
Average rent: £1,328 pcm

All figures accurate on date of publish.

If you’re considering becoming a landlord, don’t get caught up in messy deposit disputes. We can help. Find out how No Letting Go’s inventory services can remove the hassle from the situation.

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What if I don’t have any money to invest? Go get it! There is an unlimited supply of Professional Real Estate Investors who want to invest in Real Estate right now. You just have to find them, present your plan and get them to invest with you. First, Professional Real Estate Investors. All they do, all day long, is look for deals. They have cash. They also hang out in public places. So go where they gather. Every month you can find Real Estate Investors with cash in hand, trying to buy property at Public Auction. Go there and get names and emails. Go there with a property prospectus and hand it out. The goal is to find out what these investors are looking for and fill that demand. Also, Real Estate Investor have properties to sell and or rent. Go to your local newspaper or sites like Craigslist and look in the “Homes For Rent” section. Call on the rentals and make contact. Tell them who you ask them if they are looking to expand their Real Estate portfolio. You will find stable, long term Investors with money. Another great source to find money is by contacting local Property Management Companies. You can offer to send deals to them via email and fax that they can distribute to their client Investor database. The Property Management Company will love you as it helps build inventory for them as well. It is truly a win- win situation between you and the property management company. The money and resources are out there. Remember, if you create a profitable deal the money …