Tag Archives: New Landlords

Five Tips for New Landlords

Posted on by
Reply

Buying your first property is a milestone, and those who have already passed it will remember the combined feelings of excitement and anxiety. The prospect of buying a property is exciting and opens up all sorts of opportunities for the future. It’s the beginning of a portfolio and if managed properly, a profitable empire. There are however a lot of questions to be asked when purchasing a new property. Here are a few tips to help first-time Landlords with their acquisition.

1. Research & prepare


Meet people in the industry, including other landlords, letting agents. You may also want to consider joining the National Landlords Association. Make sure you read up and do research. Go onto forums and see the problems that other people have encountered. Gather some crucial literature too!

2. Delimit your requirements


Be decisive as to what kind or property you want, what kind of tenants, how big you want it to be and of course, where you want it to be. With properties in London being exceptionally expensive, you stand a better chance of getting a better yield if you look outside the M25.

3. Look for better offers


You can be sure that you’ll find a better mortgage rate than the one you’ve been given. If you’re getting a buy-to-let, choose a reasonable 3.3-3.5% rate. Any more than that and you’ll be being fleeced. Make sure that your rent is appropriately priced too. Look at various area yields to get a better idea.

4. Plan to save


Once you’ve determined a realistic monthly profit from your buy-to-let arrangement, what are you going to use it for? Make a plan, and have a contingency in case things go wrong. It is always good to have capital to replace things like broken washing machines and so on. Also, consider what will you do if your tenant becomes unemployed and can no longer afford rent. What will you do if there is a flood? Create a contingency plan and prepare to use your saved funds. Also, make sure you have bought the appropriate landlord insurance or property insurance to cover you against all eventualities.

5. Tenants = Customers = Customers Come First


If you’re looking for professionals who will pay that little bit extra rent, decorate to a high standard. Make sure its neutral, and decorated how your tenants would like it, not how you would like it. Anything too avant-garde may put certain tenants off. Also, be reasonable with rent increases. Whilst rent increases are sometimes necessary, charging too much will drive your current tenant away once the contract is over. It is also less likely to endear your tenants, leading to potential problems with rent-payments and house condition. Providing your tenants with a magnified sense of entitlement may be more costly than the rent increase. It may also have long-term repercussions and you may be less likely to get future tenants.

Rent guarantee cover a good idea

Posted on by
Reply

With the continuing financial situation showing no sign of abating, property investors looking to rent out their homes, still look to be on a winner.

Banks still tightening purse strings

Despite continued haranguing of the banks by Government Ministers and leaders of the building industry to relax lending requirements inflicted on first time buyers, young couples are still finding it difficult to get a mortgage. Many have given up hope of ever owning their own home and instead are looking to become tenants on a long term basis. The prospects for professional and occasional landlords have never been better.

Countrywide boom

Almost a quarter of accommodation in London is now controlled by the private sector and with average rents well over the £1,000 a month mark, landlord property insurance brokers are busier than ever before. It isn’t just the capital that is enjoying the boom. Letting agencies from all corners of the UK are reporting high levels of business and in most areas increases in monthly rental prices are going up every quarter. So what can go wrong?

New landlords should tread carefully

Very little according to most letting agents, but newcomers to the sector should always tread warily. It is vitally important that a new entrant to any business thoroughly researches the venture before taking the first steps, but in the case of property investment, a comprehensive landlord insurance policy is extremely important. The financial climate may be the very reason why profits in the sector are so high, but it is also the reason why so many tenants are in arrears. With unemployment the highest it has been this century, many tenants are finding rental payments hard to find.

Extra cover well worth the cost

A good business property insurance arrangement may prove a little expensive but will pay the landlord when his tenant gets in arrears and will help him cover the costs of eviction if the situation deteriorates to such an extent. The policy should also include malicious damage cover as well as all the basic elements such as fire, theft and flooding. There is no reason at all why the new landlord can’t make his mark in the property business at the moment, it just makes good business sense to allow for the unexpected and cover for every eventuality.