Expanding your Rental Property Portfolio

Generally speaking the minute landlords start to see the profits they can make from their private rental properties they automatically think about the possibility of expanding their portfolio with the purchase of more residential properties. The booming private rental sector, continually rising rents and falling house prices have made portfolio expansion easier than ever…and all you need it a few good buy to let remortgages.

What are Buy to Let Remortgages?

Buy to let remortgages are an easy and convenient way of releasing equity from rental properties you already own. This money can then be used as a deposit on another rental property. Of course the rental property you already own has to have increased in value to such an extent that there is a decent amount of equity there, and the achievable rent has to have increased in line with the value.

So for example, let’s say you bought a rental property five years ago for £100,000 and at the time you received £500 per month in the form of rent. You had a £75,000 buy to let mortgage and because it was an interest-only mortgage you still owe £75,000 today. Now let’s say that your property is worth £150,000 in the current market and you receive £750 per month rent; an increase of 50% in both cases.

By searching through the available buy to let remortgages you could undoubtedly find one that would allow you to release 50% of the equity i.e. £37,500, on the basis that you now achieve 50% more rental income. The rent payments you receive will still cover the mortgage payments and you are left with £37,500 to use as a deposit on an additional rental property.

Where to Find Buy to Let Remortgages

A lot of the mortgage providers that offer buy to let mortgages also offer a range of buy to let remortgages. The terms and conditions differ quite dramatically from one provider to the next though making it vital that you get advice from a professional before agreeing to any buy to let remortgages.

Your current buy to let mortgage provider may offer you a remortgage should you enquire but this will rarely be the best deal available…it’ll simply be the easiest. Shop around and research a number of buy to let remortgages, then make an appointment with a buy to let mortgage broker and see if they can get you an even better deal. If they can’t you haven’t lost anything but if they can you will be one step closer to being a successful multi-property landlord.