Property Investments in Uganda – Buy to Let
Buy-to-Let Property Investment
Buy-to-Let property in Uganda offers excellent yields with a good capital growth potential and it looks as though the trend is going to continue into the near future.
Buy to let involves investing in property with the expectation of capital growth with the rental income from tenants covering the mortgage costs and any outgoings.
However, the gross return from buy to let properties – that is the rent received less costs such as letting fees, maintenance, service charges and taxes – Investors need to take a view on the likelihood of capital appreciation exceeding inflation.
Factors to consider
Do
- Think of your investment as medium to long-term
- Research the local market
- Do your sums carefully
- Consider renovating to a high standard to attract tenants quickly.
Don’t
- Purchase anything with serious maintenance problems
- Think that friends and relatives can look after the letting for you – You’re probably better off with a full management service
- Cut corners with tenancy agreements and other legal documentation.
Which property?
Investing in a buy to let property is not the same as buying your own home. You may wish to get an agent to advise you of the local market for rented property. Is there a demand for say, two bedroom flats or four bedroom houses or properties close to schools or transport links? An agent will also be able to advise you of the standard of decoration and furnishings which are expected to get a quick let.
Agents
Letting property can be very time consuming and inconvenient. Tenants will expect a quick solution if there is plumbing problem over holiday weekend! Also do you want to advertise the property yourself and show around prospective tenants? An agent will be able to deal with all of this for you.
Tenancy agreements
This important document will ensure that the legal position is clear.
Taxation
When buying to let, taxation aspects must be considered.
Tax on rental income
Income tax will be payable on the rents received after deducting allowable expenses. Currently allowable expenses include mortgage interest, repairs, agent’s letting fees and an allowance for furnishings.
How we can help
Whilst some generalizations can be made about buy to let properties it is always necessary to tailor any advice to your personal situation. We would be happy to discuss buy to let further with you.
Do you have a question?
We’re happy to assist and help answer your questions, please speak to property agent on +256709220000 or request a call back
