With more people than ever looking at ways to supplement their income or find more creative ways of bringing in revenue, the prospect of becoming a landlord is of interest to many eagle-eyed investors. The market for tenancies in the UK is booming: supply is low and demand is high, creating the ideal environment to start a property business.
However, setting up as a landlord is not a walk in the park. It’ll take patience and dedication to be successful. Many people think you just buy the property, find someone to live there and then the money rolls in. This couldn’t be further from the truth. Read on to find out how to get started the right way.
Be clear on your responsibilities
Before you do anything, start reading up on your duties as a landlord. If you’re going to be responsible for providing a living situation as a respectable property professional, then you need to be educated on the topic and meet all your legal requirements. You will struggle to keep your property filled (and therefore generate income) if you don’t provide adequate facilities or support to your tenants.
Double-check your investment
You’ll be taken seriously in your search for a property if you have secured an Agreement in Principle (AIP). This demonstrates to estate agents and sellers that you are more likely to get the funding and that you aren’t wasting time.
You should also get quality landlord insurance, as it will provide peace of mind for you and your tenants that your investment is protected. It’s often a condition of a buy-to-let mortgage that you must have this cover in place.
Choose your property carefully
Once you’ve decided that the landlord life is for you, it’s time to find the right property.
Look at the average rent in the area you’ll be buying for similar properties and make sure that the rent capability will make the investment worthwhile. Be thorough when checking for any structural issues, as these would be costly down the line.
You may wish to consider a new build, as these are proving increasingly popular for their higher EPC ratings. They could also need less maintenance as a more contemporary structure.
Decide how to manage the property
If you’re a DIY whizz or a trade professional, you may be well equipped to do much of the ground support that comes with letting property.
However, you may be busy with other aspects of life and could benefit from the help of a letting agent. They do a lot of the administration and day-to-day legwork for you, leaving mainly the duties of reporting your taxes on income earned and setting up a deposit protection scheme.
Budget for renovations
Remember that you may have to do some renovations before the property is suitable for habitation, so factor this into your initial cost. The choice to provide non-furnished accommodation could lessen the early expense of setting up.