DarrenK

Buying an investment property to enjoy the rental income may make sense provided you do your research carefully.

One key aspect is the difference between 'gross yield', which is the rental income received, as a percentage of the property purchase price; and 'net yield', which is the rental income less all charges and expenses.

Aside from normal expenses such as the costs of finding renters, taxes, etc etc there is another prime cost factor - this is the maintenance expense of maintaining the property every year - often called 'service charges' in the UK.

Any investor buying property for the rental yield potential needs to examine the fine print in the contracts, especially if buying 'off-plan'. This is because many developers are now shifting a significant annual financial burden in the form of maintenance charges onto purchasers.

Buyers of detached, stand-alone units/villas, are in a better position because they can control the maintenance charges themselves. Buyers of apartments in compounds or as part of developments typically have very limited ability to ensure the maintenance charges are minimilised.

I buy rental properties in Bodrum because the population growth rate is tremendous, ensuring rental demand all year round, AND because the summer holiday let rate is very attractive. However, it is very difficult to find properties, preferably two bedroom aprtments, where the maintenance charges can be controlled. I have been lucky enough to find several to date but it requires a lot of leg work, and if anyone would like to share efforts on this I would welcome their email.