With mortgages continuing to be out of reach for many first time buyers, and the UK rental market continuing to grow, there’s never been a better time to become a landlord.
Below we share with you some of the key things you need to consider before creating your own property empire.
Location, location, location
As Kirsty and Phil have been telling us for several years, buying a property is all about the location, and this is perhaps even more important for buy-to-let properties.
Not only do you need to make sure the property is in a desirable area but you also need to think about transport links, schools and outside space. Renters can be very choosey and ensuring you pick the right house will ensure the amount of time that the property is empty is kept to a minimum.
Another key point to consider is the clientele of the area. If you’re in the heart of a student area, rental income is likely to be lower. There’s nothing wrong with that, just don’t go out and buy a penthouse and kit it out with high end furniture!
Keep it legal
When renting property in the UK it is important that you meet certain safety standards.
The two main requirements are that the property and your tenants have a gas safety certificate that’s updated annually, and an Energy Performance Certificate.
There are also rules and regulations associated with treating damp, maintenance, fire safety and much more. If you’re renting your property through an agency they will be able to help you with this, if not it may be worth while consulting a solicitor.
Picking your tenant
Getting good tenants into your property can sometimes be the hardest part of the whole process.
You need to ensure that they are trustworthy and will look after your property, pay rent on time and keep up any maintenance such as garden work and general cleaning.
Unfortunately there’s no tried and tested method for picking your tenants. Sometimes you don’t have the luxury of picking a tenant, you just need someone who will pay the bills!
But if you can, you should always ask for references from current employers and previous landlords. If tenants are unwilling to give these details it could be better to avoid them.
Plan for the worst
Not to put a dampener on things, but you should always plan for the worst when it comes to renting property. Never rely on the income and always keep some funds for repairs, maintenance and any times when the property is empty.
Although being a landlord can be a tiring process the rewards can be huge. As long as you get good tenants you could have a nice income stream for years to come, and once your mortgage is paid off you have a free house!
This guest post was written on behalf of Ashley Park Debt Solutions who specializes in consolidation loans, IVAs, debt management plans and other financial solutions.
Editor’s note: I have been a landlady in a student town for five years, and a way I have found to increase my rental income was to rent each room separately. I also include all bills and pay them myself, so the tenants know exactly how much they can budget for housing costs. All the furniture was bought second hand or from cheap stores, and the small surplus each month is kept to cover the bills should a room stay empty. Having a contract for each room, the chances they will all be empty at the same time is lower. And the tenants screen potential new roommates before I make a final decision, to ensure they get along.
Do you own rental property? What is your experience?