Things to consider for first-time landlords
Glynn Rudge (pictured) is area lettings manager for Your Move Lettings agency
Following reports that the number of new prospective tenants is continuing to rise to record breaking levels, it’s understandable that some may now be looking to the lettings market and the income opportunities it could bring as a landlord. The decision to become one, however, shouldn’t be taken lightly and it’s important to take a step by step approach first.
STEP 1: Think about your Budget
Consider the cost of buying a rental property but also what the associated costs could be. Ongoing costs can include letting agency fees and insurance costs but also maintenance costs to ensure that the property is suitable for tenants and complies with regulatory requirements. Decide too if you want to rent the property furnished, or not, and what white goods you may need to buy. Whilst it’s important to find out what your total outgoings might be, at the same time, remember all of these costs can be offset against the rent you will receive each month.
STEP 2: Choose a letting agent
Some landlords may prefer to find tenants, collect rents and manage their rental property themselves, to maintain control or to save money, but it may come with risks. Using a reputable lettings agency can provide the reassurance of knowing there is someone there to help you. They can ensure you are maintaining the correct rental income and provide support if things do go wrong. They will become an effective partner and help deal with the legal aspects and act as a buffer between you and the tenant, giving some distance and also dealing with day to day issues. Whether it’s finding the right tenants, marketing the property to a bigger audience, organising the compliance checks or offering support when things go wrong, their service can prove invaluable. Some agents, like Your Move for example, offer different levels of service dependant on your budget and what rental control you’d like.
STEP 3: Find a property
Decide where you want to buy a rental property taking into account likely demand, potential yields, the kind of tenant you’d consider (i.e. student, professionals or families) and if you are prepared to renovate or improve the property. You may prefer to buy a property with tenants already in place or which is already equipped for some. If you build a good relationship with your local agency, they can offer support about rental income, standard of furnishing and speed of let to put your mind at rest no matter where you buy from.
STEP 4 – Understand your ongoing responsibilities
With new legislation being regularly introduced it is important for landlords to understand their legal responsibilities before, during and after a tenancy begins. If not, you may be subject to fines or prosecution and the health and well-being of your tenant may be compromised. Again a reputable letting agent should ensure you are operating compliantly or advice is available via the government website.
Overall, there’s clearly demand for rental property and advantages to being a landlord – it’s just important, however, to do your homework first and make sure your experience of becoming one is the best it can be.