As housing demand continues to spiral, it’s never been a better time to invest in buy to let property. Landlords can demand increasingly higher rents, and can afford to be selective over the tenants they choose. As such, rental property offers a lucrative return on investment, and an opportunity to grow your finances with a steady, regular income.
However, to minimise hassle and expense as a landlord, it’s essential to think carefully about the steps to becoming a landlord, and take a few precautions that will save you headaches later down the line.
Let’s take a look at some of the key things to consider before you enter the rental market:
To protect the value of your investment, it’s crucial to take out specialist insurance that provides adequate cover for your tenancy. As a landlord, you should have a policy that covers third party damage, to ensure that you don’t bear the brunt of any accidents or incidents.
If you’re investing in property to become a landlord, you’ll need a buy to let mortgage that allows you to rent the property out to a tenant. However, many landlords who have inherited property don’t realise that they may need to change the status of their mortgage before they can legally take on a tenant. Explore your finance options to ensure that you can secure funding before you make any decisions.
With these costs in mind, think carefully about the type of tenancy you’d like to take on, and the rent you’re planning to charge. After your mortgage, insurance and tax bill, will you be making an attractive return on your investment? Remember to account for any unseen expenses that may be deducted from your income over the course of the tenancy and between lettings.
Even perfect tenants can cause headaches when issues with boilers, appliances and plumbing arise. So it’s crucial to have a team of trusted trades people who can handle maintenance and repairs. For a new build, the maintenance costs of your property are likely to be significantly lower, but you’ll still need to take care of boiler servicing, gas safety certificates and more.
By partnering with a facility management firm that specialises in landlord services, you can save time, stress and money, with one contact for all of your property management needs. Your facility manager will also make sure that your décor and furnishings are up to scratch, to maximise your rental value.
Becoming a landlord isn’t as simple as posting an advert online and opening your door to potential tenants. Take a measured approach to renting your property, with a clear understanding of your financial prospects and the support of a facility management firm. In doing so, you can ensure that you get the best possible return on investment, with a low level of risk and hassle.