Is this a good buy-to-let investment?

Purchase price

What is actually of interest is not the purchase price of the property, but rather the cost of getting the property ready for the rental business.

In practice this will include -

• Stamp duty
• Legal fees associated with the purchase
• Search fees
• Survey fees
• Mortgage arrangement fees - these could instead be considered part of ongoing costs
• Cost of any works required to prepare the property
• Costs associated with finding an initial tenant
• Expected interest payments until the first tenant starts paying rent

In practice, particularly for properties incurring at least 3% stamp duty and significant refurbishment before it can be let, there can be a huge difference between the transaction price and the true cost of getting the property into a rental business.